SEMINAR 37 The Impact of Net Zero Energy Buildings on the Electric Grid

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1 2016 Annual Conference McHugh Energy Consultants Jon McHugh, PE McHugh Energy Consultants Inc. SEMINAR 37 The Impact of Net Zero Energy Buildings on the Electric Grid Zero Net Energy: What Metric to Use? St. Louis, Missouri 1

2 Learning Objectives 1. Describe the pros and cons of the various ZNE metrics. 2. Understand available financing mechanisms and rebates for ZNE projects and identify the best options. 3. Understand and identify the energy generation, storage, and monitoring technologies as well as new design strategies that best suit ZNE projects. 4. Identify potential electric grid impacts from ZNE buildings. ASHRAE is a Registered Provider with The American Institute of Architects Continuing Education Systems. Credit earned on completion of this program will be reported to ASHRAE Records for AIA members. Certificates of Completion for non-aia members are available on request. This program is registered with the AIA/ASHRAE for continuing professional education. As such, it does not include content that may be deemed or construed to be an approval or endorsement by the AIA of any material of construction or any method or manner of handling, using, distributing, or dealing in any material or product. Questions related to specific materials, methods, and services will be addressed at the conclusion of this presentation. McHugh - Zero Net Energy: What Metric to Use? 2

3 Outline/Agenda Why ZNE? Policy requirements for ZNE ZNE and ZE Metrics California ZNE Metrics ZNE Tier (0 TDV) CALGreen CA State Buildings ZNE (Source Energy) ZNE and Grid Impacts McHugh - Zero Net Energy: What Metric to Use? 3

4 What is Zero Net Energy? Living within site resources Off-grid examples Energy usage is limited to the renewable or regenerative energy available on site. Off-grid cons: Wood smoke Site area for biomass Storage: capacity, round trip efficiency, cost McHugh - Zero Net Energy: What Metric to Use? 4

5 Expanding the Scope of ZNE to Grid Connected Systems Use the grid as a large battery to provide energy storage. With 100% round-trip storage efficiency Use natural gas and other fuels for heating and offset their use by exporting renewable energy (electricity) Expanding the site to be a campus, a subdivision, or a ZNE district. Purchase off-site renewable energy or Renewable Energy Credits (RECs) [usually limited] McHugh - Zero Net Energy: What Metric to Use? 5

6 Site, Source and TDV Energy Source Energy into Power Plant Elec = 3 kwh (10.2 kbtu) Source Energy into Pipeline Natural Gas = 1 therm (100 kbtu) TDV Energy based on cost Includes: Fuel cost T&D cost (pipelines, power lines) Storage and Spinning Reserve Equipment Cost Profit and Overhead PV peak coincidence, 1 kwh = 1.2 kwh avg elec 4.5 kwh (15 kbtu) avg gas Site Energy Elec = 1 kwh (3.4 kbtu) Site Energy Natural Gas = 1 therm (100 kbtu) McHugh - Zero Net Energy: What Metric to Use? 6

7 Trade-offs between fuels Site: a kwh of electricity offsets 3,412 Btus of natural gas. Source: a kwh of electricity offsets the amount of gas burned at the power plant Example: 1 kwh x r elec = r gas x 3,412 Btus of natural gas Where r i is a source energy conversion factor Cost: the value of exported electricity is compared to the cost of purchased gas Carbon: displaced carbon from exported renewable electricity is offsetting carbon from natural gas consumption McHugh - Zero Net Energy: What Metric to Use? 7

8 National Average Source Energy Conversion Factors (NIBS/USDOE) Energy Form Source Energy Conversion Factor (r) Energy Form Source Energy Conversion Factor (r) Imported Electricity 3.15 Steam 1.45 Exported Renewable Electricity Hot Water 1.35 Natural Gas 1.09 Chilled Water 1.04 Fuel Oil (1,2,4,5,6,Diesel, Kerosene) 1.19 Coal or Other 1.05 Propane & Liquid Propane Exported electricity is valued the same as imported electricity as it is displacing imported electricity 1.15 McHugh - Zero Net Energy: What Metric to Use? 8

9 Forecast Costs Building up the Electric TDVs (California) 1. Start with the CEC Forecast Commodity Costs 2. Add the marginal T&D delivery costs as a function of Temperature in the Typical meteorological year weather file 3. Add projection of internalized CO2 costs as a function of Temperature 4. Adjust to bring to revenue requirement (rate levels) CO 2 T&D Hot afternoon PX Revenue Neutrality Adjustment Monday Tuesday Wednesday Thursday Friday McHugh - Zero Net Energy: What Metric to Use? 9

10 TDV value of End-Uses ZNE: Codes & Ratings What end-uses? HVAC, Lighting and Water Heating (Traditional Regulated Loads) White goods Plug Loads Process loads Electric vehicles Swimming pools and spas Asset ratings Based on simulation and prediction. Average usage patterns Outcome based ratings Based on measured energy consumption after the building is operated for a period of time McHugh - Zero Net Energy: What Metric to Use? 10

11 PV Size needed for 2430 sf ZNE home EE 15% in CZ 12 Sacramento, CA ASHRAE CZ 3B Net Energy Metering in 2016: Offsetting consumption, reimbursed at retail rate. Excess generation reconciled at end of year, reimbursed at wholesale rate. McHugh - Zero Net Energy: What Metric to Use? 11

12 PV Size Needed for 10,619 sf ZNE Building in Capitola, CA (T-24 CZ 3) Gas consumption is 30% of site energy Commercial less difference between site and source than for residential McHugh - Zero Net Energy: What Metric to Use? 12

13 A Tale of Two Futures The warmest it s been over the past 2 million years is 2 o C above preindustrial times. RCP = Representative Concentration Pathways (e.g., scenarios) Source: IPCC Working Group III Contribution to the IPCC Fifth Assessment Report McHugh - Zero Net Energy: What Metric to Use? 13

14 Our Problem Statement Same emissions as in 1990 though population has increased by 40%! Sources: Historic emissions from California's greenhouse gas emission inventory (CARB). BAU scenario from E3 and LBNL s PATHWAYS model, Baseline scenario: immediate freeze on current policies. McHugh - Zero Net Energy: What Metric to Use? 14

15 Big Bold Goals- Adopted by Energy, Utilities Commissions All new residential construction in California will be zero net energy by 2020 All new commercial construction in California will be zero net energy by % of existing commercial buildings will be retrofit to ZNE by 2030 McHugh - Zero Net Energy: What Metric to Use? DPR Construction San Diego Corporate Office, Chip Fox, DG&E One Sky Homes Cottle House in San Jose, Allen Gilliand 15

16 State Buildings ZNE goals 2012 California Executive Order B % of new state facilities beginning design after 2020 shall be ZNE All new state buildings and major renovations starting design in 2025 shall be ZNE State agencies shall strive towards ZNE for 50% of existing state-owned building area by McHugh - Zero Net Energy: What Metric to Use? 16

17 as a fraction of existing The 2030 Challenge Existing Building Stock EUI from 2003 CBECS and 2001 RECS EUI in Site Energy 30% 20% 10% 0% Off-site Off-site renewable energy offsetting no more than 20% of the target reduction Remaining reduction from efficiency and onsite renewables McHugh - Zero Net Energy: What Metric to Use? 17

18 Progressive Pathway to ZNE T24 Standards (Bldg Code) 2019 Standards Adopted 2022 Standards Adopted 2025 Standards Adopted 2028 Standards Adopted Recommended Interim Milestones Warehouses: 49 kbtu/sf* (0.6 GJ/m 2 ) Schools: 92 kbtu/sf (1.0 GJ/m 2 ) Small Office: 145 kbtu/sf (1.6 GJ/m 2 ) Retail: 149 kbtu/sf (1.7 GJ/m 2 ) College: 160 kbtu/sf (1.8 GJ/m 2 ) Lodging: 167 kbtu/sf (1.9 GJ/m 2 ) Large Office: 203 kbtu/sf (2.3 GJ/m 2 ) Ref Warehouse: 211 kbtu/sf (2.4 GJ/m 2 ) Health: 276 kbtu/sf (3.1 GJ/m 2 ) Food store: 447 kbtu/sf 7.1 GJ/m 2 ) ZNE Goals ZNE Voluntary Tier CALGreen All Residential New Construction 50% of New State Buildings ZNE All New State Buildings ZNE All Commercial New Construction ZNE 50% of Commercial Existing Buildings ZNE *Source energy kbtu/sf from CEUS CA Commercial End-Use Survey McHugh - Zero Net Energy: What Metric to Use? 18

19 Minimum Efficiency TDV Define On-site Cost based 2015 California Integrated Energy Policy Report (IEPR) Definition ZNE Code Building is one where the value of the energy produced by on-site renewable energy resources is equal to the value of the energy consumed annually by the building, at the level of a single project seeking development entitlements and building code permits, measured using the California Energy Commission s Time Dependent Valuation metric. A ZNE Code Building meets an Energy Use Intensity value designated in the Building Energy Efficiency Standards by building type and climate zone that reflect best practices for highly efficient buildings. McHugh - Zero Net Energy: What Metric to Use? 19

20 CALGreen Voluntary ZNE Tier for new low rise residential buildings Title 24, part 11 (Green Building Standard) Minimum Energy Eff Prerequisite Either 15% or 30% less energy than energy code (depends upon climate zone) Energy Design Rating, EDR 0 Based upon TDV (cost) Includes regulated loads + lighting, white goods, consumer electronics and other plug loads Mandatory only if adopted by a local jurisdiction Asset rating based on computer simulation Preparation for 2020 ZNE residential code Higher equipment efficiencies reduce size of PV system needed Loads not included Swimming pools & spas Electric vehicles McHugh - Zero Net Energy: What Metric to Use? 20

21 USDOE/NIBS Definition of Zero Energy Building (ZEB) Zero Energy Building (ZEB) An energy-efficient building where, on a source energy basis, actual annual delivered energy onsite renewable exported energy RECs must be retired Zero Energy Campus An energy-efficient campus where Zero Energy Portfolio An energy-efficient portfolio where Zero Energy Community An energy-efficient community REC-ZEB Supplement EE and renewables with renewable energy credits McHugh - Zero Net Energy: What Metric to Use? 21

22 CA Department of General Services ZNE Definition ZNE Source Produces as much energy as it consumes over the course of a year, when accounted for at the energy generation source. Priority in order: Building, Campus, Portfolio, Community The Renewable Energy Credits (RECs) must be retired (not sold) for all on-site renewable energy systems. Based upon 12 consecutive months of actual energy performance data RECs not used to qualify for ZNE status McHugh - Zero Net Energy: What Metric to Use? 22

23 Interaction of ZNE and RPS RPS renewable portfolio standard If utility renewables are of the same type as on-site renewables, generation by both sources is coincident. Oversupply and undersupply at same time Add storage or demand control Diversify renewable supply (technology and location) and diversify load (export out of local region) McHugh - Zero Net Energy: What Metric to Use? 23

24 50% Renewable Portfolio Standard in 2030 Shifts Peak PV is less coincident/valuable Source: E Draft TDV Updates McHugh - Zero Net Energy: What Metric to Use? 24

25 High RPS addresses peak day but over-generation in off-peak months July Generation Mix April Generation Mix E Investigating a Higher Renewables Portfolio Standard in California. McHugh - Zero Net Energy: What Metric to Use? 25

26 Conclusions ZNE is a key term in energy policy Different definitions result in differing levels of renewables (site, source and value) California codes use time dependent value USDOE and CA State Buildings are using source energy The 2030 Challenge is using site energy McHugh - Zero Net Energy: What Metric to Use? 26

27 Conclusions (continued) ZNE increases the use of on-site renewables Including being a net generator If state policy also increases utility scale renewables, oversupply at certain times is likely Grid integration is increasingly important and increases the value of demand response, storage and wheeling of power. McHugh - Zero Net Energy: What Metric to Use? 27

28 Is ZNE Impossible? Impossible is not a fact. It's an opinion. Impossible is not a declaration. It's a dare. Impossible is potential. Impossible is temporary. Impossible is nothing. -Muhammad Ali McHugh - Zero Net Energy: What Metric to Use? 28

29 Questions? Jon McHugh, PE McHugh - Zero Net Energy: What Metric to Use? 29

30 Bibliography CEC California Integrated Energy Policy Report (IEPR). California Energy Commission. 01/TN210527_ T115023_2015_Integrated_Energy_Poli cy_report Small_Size_File.pdf Department of General Services Definition of Zero Net Energy (ZNE) for California State Agency Compliance with Executive Order B May 19, E Energy and Environmental Economics Draft TDV Updates. CEC Staff Workshop May 12, /TN211454_ T132542_E3_Draft_TDV_Presentation_ Updated_51216.pdf McHugh - Zero Net Energy: What Metric to Use? 30

31 Bibliography Continued E Energy and Environmental Economics. Investigating a Higher Renewables Portfolio Standard in California. January h_appendices.pdf E California PATHWAYS: GHG Scenario Results. April 6, d_april2015.pdf and McHugh Energy ,000 kwh to Zero in Eight Years Flat: A Strategy for Net Zero Energy Residential Buildings by NIBS for USDOE A Common Definition for Zero Energy Buildings. September n_zero_energy_buildings_ pdf McHugh - Zero Net Energy: What Metric to Use? 31

32 Acknowledgments CA Statewide Codes & Standards program Pat Eilert, Manager, PG&E C&S Program Alex Chase, Energy Solutions John Wilson, Energy Foundation Snuller Price, E3 McHugh - Zero Net Energy: What Metric to Use? 32

33 Appendix McHugh - Zero Net Energy: What Metric to Use? 33

34 ZNE s contribution to GHG Reduction 100% new Res ZNE by % new Com ZNE by % of Com retrofits ZNE by 2030 Renewable Portfolio Std (RPS) Note: ZNE includes only energy savings and is subtracted from EE to avoid double counting. McHugh - Zero Net Energy: What Metric to Use? 34

35 Federal Preemption of State Energy Codes National Appliance Efficiency Conservation Act (NAECA) covered product is something regulated by the Federal appliance efficiency standards Prescriptive Building Energy Code Requirements for every combination which includes a covered product the efficiency of which exceeds either standard or level referred to in subparagraph (D), there also shall be at least one combination which includes such covered product the efficiency of which does not exceed such standard or level. [42USC 6297(f)(3)(E)]. Performance Energy Code Requirements the baseline building designs are based on the efficiency level for such covered product which meets but does not exceed such standard or the efficiency level. [42USC 6297(f)(3)(D)] McHugh - Zero Net Energy: What Metric to Use? 35

36 Importance of Federal Standards in Context of Preemption: Residential Products Figure 1. Estimated Percent of Statewide Electricity Use per Household Pre-Empted by Federal Appliance Standards (Grey shading indicates appliances which are pre-empted) Pools and Spas 6% TV, PC, and Office Equipment 15% Miscellaneous 11% Lighting 2% Lighting 20% Figure 2. Estimated Percent of Statewide Gas Use per Household Pre-Empted by Federal Appliance Standards (Grey shading indicates appliances which are pre-empted) Cooking 7% Pools, Spas, Misc 2% Dryer 3% Pools, Spas, Misc 1% Space Heating 43% Water heating 3% Space Heating 4% Laundry 5% Dishwashers and Cooking 5% Air Conditioning 10% Refrigerators and Freezers 19% Water Heating 44% 65% of electric and 99% of gas end-use categories include preempted products. (This is a high-level assessment; thus, some product categories exist within wedges that may not be explicitly preempted) McHugh - Zero Net Energy: What Metric to Use? 36

37 Importance of Federal Standards in Context of Pre-emption: Nonresidential Products Figure 1. Estimated Percentage of State-wide Electric Energy Use for Commercial Applications (Annual Total = 67,077 GWhs) Figure 2. Estimated Percentage of State-wide Gas Energy Use for Commercial Applications (Annual Total = 127, Therms) 64% of electric and 70% of gas end-use categories include preempted products. (This is a high-level assessment; thus, some product categories exist within wedges that may not be explicitly preempted) End use categories that have some products pre-empted DOE may issue positive determinations; preliminary determinations anticipated In 2011 by the DOE **Exterior Lighting:1) all exterior lighting standards in CA adopted before 2015 are not preempted, with the exception of mercury vapor lamps, which are banned starting in ) It doesn't appear that this data set includes roadway or parking energy use from lighting, which if included, could dramatically increase the energy use percentage for exterior lighting. Sources: 1) 2) 3) McHugh - Zero Net Energy: What Metric to Use? 37

38 Additional Efficiency Package Options (2015 IECC C406) DOAS Dedicated Outside Air IECC Add Options PV On-site Renewables HVAC +10% Eff Lighting -10% LPD DHW HR or Solar Addressable Lighting McHugh - Zero Net Energy: What Metric to Use? 38

39 Jurisdictions with Multipath Energy Codes and higher equipment efficiencies Residential 6.8 M M = 13.7 M Washington State (upheld by Federal Appeals Court) Oregon Nonres 12.8 M + 0.5*6.7 M = 22 M Illinois (IECC 2012 including Section C-406) Half of MA (reach code) precursor to IECC C- 406 Maryland (IECC 2012 including Section C-406) McHugh - Zero Net Energy: What Metric to Use? 39

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