Power Smart Partners - Industrial Incentives and Opportunities. Industrial Marketing Managers: Alex Adams, P.Eng. Eddie Young, P.Eng.

Transcription

1 Power Smart Partners - Industrial Incentives and Opportunities Industrial Marketing Managers: Alex Adams, P.Eng. Eddie Young, P.Eng.

2 Outline 1. Why Power Smart? 2. Power Smart Partners BC Hydro s Integrated Energy Management Solution for Industrial Customers 3. Energy Management Initiatives 4. Energy Efficiency Projects

3 Why Power Smart? Reliable Power, At Low Cost, For Generations The Gap

4 What is Power Smart Partners? An integrated (People Process and Projects), continuous improvement (Plan Do Check Act) program to help BC s industrial customers improve energy efficiency. Incentives and expertise are available for you to: Develop a Sustainable Energy Management Plan Hire an Energy Manager Start an Employee Energy Awareness Program Perform Energy Studies and Audits Implement Energy Efficiency Projects

5 Energy Management Initiatives

6 *Courtesy of Bill Meffert, Georgia Tech

7 Quality ISO 9001 Environment ISO Energy MSE 2000

8 Initiative Description Offer Eligibility Energy Management Assessment Quantitative assessment of management practices related to energy One2Five Fully Funded > $200K Acheiver Fully Funded > $50K Industrial Energy Manager Organizational leader for energy management program Standard 60% w/ SEMP 75% + 25% + workshop > $500K > $500K + agreement Employee Awareness Support for developing a energy awareness program W/ IEM: on-site workshop, awareness resources IEM participant General workshop, awareness resources > $50K Monitoring Targeting & Reporting (MT&R) MT&R is a proven method for measuring and maintaining energy performance, and for identifying opportunities to improve energy efficiency Monitoring audit On-site workshop MT&R Implementation Plan Funding for portions of implementation > $50K

9 Industrial Energy Manager Process Flow Industrial Energy Manager with SEMP Process Flow Interest in the IEM Offer Complete IEM Scope of Work IEM Agreement Program Implementation - Reporting BCH payments (accepted Reports) Projects, Programs, other initiatives implemented Complete IEM with SEMP Scope of Work IEM Agreement SEMP workshop, EMA SEMP delivered Quarterly reports Projects, Programs, other initiatives implemented

10 A video on the Power Smart Industrial programs at work

11 Energy Efficiency Projects

12 When you don t know where to start: 1) IDENTIFY Perform a Plant-wide Energy Audit or CSI to prioritize opportunities If you know of an end-use system with an opportunity: 1) IDENTIFY Perform an End-Use Assessment to see if an Energy Study is worthwhile 2) INVESTIGATE Perform an Energy Efficiency Feasibility Study to build a business case The 3 I s 3) IMPLEMENT Receive Project Incentive Funds for your energy efficiency project You do not need to follow this process. You can start or finish at any point.

13 Plant-wide Energy Audit There are two offers available: 1. Customer Site Investigation (CSI) For sites that consume between 1 20 GWh/yr ($50,000 and $1,000,000 per year) 2. Plant-wide Energy Audit For sites that consume more then 20 GWh/yr (more then $1,000,000 per year)

14 Customer Site Investigation (CSI) What is a CSI? A 1-day walkthrough of your facility to analyze your energy use and find opportunities to be more energy efficient. Who is a CSI for? Industrial customers that spend between $50,000 and $1,000,000 per year on electricity The Offer: 100% funded

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17 Plant-wide Energy Audit What are Plant-wide Energy Audits? More detailed then a CSI but serves the same purpose: to analyze your electricity use and find opportunities for efficiency Meant for larger electricity consumers (spend more then $1,000,000/yr) The Offer: 75% funded. 100% if an energy study is completed within 6 months or an energy efficiency project is implemented within 18 months.

18 When you don t know where to start: 1) IDENTIFY Perform a Plant-wide Energy Audit or CSI to prioritize opportunities If you know of an end-use system with an opportunity: 1) IDENTIFY Perform an End-Use Assessment to see if an Energy Study is worthwhile 2) INVESTIGATE Perform an Energy Efficiency Feasibility Study to build a business case The 3 I s 3) IMPLEMENT Receive Project Incentive Funds for your energy efficiency project You do not need to follow this process. You can start or finish at any point.

19 End-use Assessments What are End-Use Assessments? End-use Assessments are walkthroughs to scope out a potential opportunity on your end-use system to see if a more extensive Energy Study is worthwhile. Also known in industry as scoping studies, prefeasibility studies or Level 1 Assessments System size must exceed 200hp to qualify The Offer: 100% funded up to $5000.

20 When you don t know where to start: 1) IDENTIFY Perform a Plant-wide Energy Audit or CSI to prioritize opportunities If you know of an end-use system with an opportunity: 1) IDENTIFY Perform an End-Use Assessment to see if an Energy Study is worthwhile 2) INVESTIGATE Perform an Energy Efficiency Feasibility Study to build a business case The 3 I s 3) IMPLEMENT Receive Project Incentive Funds for your energy efficiency project You do not need to follow this process. You can start or finish at any point.

21 Energy Efficiency Feasibility Study What are Energy Studies? An Energy Study builds a business case for an energy efficiency project by providing energy savings estimates, implementation costs and other benefits. Performed by BC Hydro approved engineering consultants System size must exceed 200 hp to qualify The Offer: 75% funded. 100% if you follow through with an energy efficiency project within 18 months

22 Energy Studies - Process

23 When you don t know where to start: 1) IDENTIFY Perform a Plant-wide Energy Audit or CSI to prioritize opportunities If you know of an end-use system with an opportunity: 1) IDENTIFY Perform an End-Use Assessment to see if an Energy Study is worthwhile 2) INVESTIGATE Perform an Energy Efficiency Feasibility Study to build a business case The 3 I s 3) IMPLEMENT Receive Project Incentive Funds for your energy efficiency project You do not need to follow this process. You can start or finish at any point.

24 Project Incentives Funds What are Project Incentive Funds? Project Incentive Funds are available to reduce the capital cost of implementing hard-wired energy efficiency projects. The offer is different for customers on Transmission vs Distribution voltage rate The Offer for Industrial Distribution (12xx rate): BC Hydro can pay up to 75% of the project cost or buy down your payback period to as low as a 1 year.

25 Project Incentives - Calculation The eligible incentive will be the lower of: 1. Calculated incentive = [Total energy saved] x [incentive rate /kwh] 2. Amount required to reduce the payback period to one year 3. 75% of project cost 4. $500,000 per project

26 Example 1 - Fans Project Project Cost = $100,000 Energy Savings = 600,000 kwh/yr = 5 /kwh Lifespan = 10 years Payback before incentive = $100,000 / ($30,000/yr) = 3.3 yrs 1) Incentive = (600,000kWh/yr*10 yrs)*($0.016/kwh) = $96,000 3) Incentive to 1 year payback = $70,000 5) Incentive to 75% of project cost = $75,000 Therefore, this project is eligible for a $70,000 incentive. Payback after incentive = 1.0 years

27 Project Incentive Data Points For Industrial Distribution customers, for projects with a lifespan (persistence) of 10 years: EE Projects with a payback of 4 years or less BC Hydro can buy down to 1 year EE Projects with a payback of 6 years BC Hydro can buy down to 2 years EE Projects with a payback of 9 years BC Hydro can buy down to 3 years

28 Project Incentives Eligibility Industrial customers serviced at Distribution voltage (rate class 12xx) that spend more then $50,000/year on electricity Project saves a minimum of 100,000 kwh/yr: Equivalent to about $5000 per year in electricity Equivalent to a 10% energy reduction on fully loaded 200hp motor operating 6000h/yr Bundling of projects into a single application is allowed Project must have simple payback greater then 1 based on energy savings (before application of the incentive)

29 Project Incentives Process 1) Submit a Project Incentive application and proposal. Proposal includes project description with energy baseline, kwh savings (+/-10%) and project cost 2) BC Hydro reviews proposal and issues agreement (1-3 weeks) 3) Customer signs agreement and implements project 4) Customer submits completion documents and project is site inspected. BC Hydro declares Project Completion. 5) Payment is issued via the following: <0.5GWh/yr and <$100k 100% at Project Completion >0.5GWh/yr or >$100k 75% at Project Completion and 25% after Measurement and Verification (M&V)

30 TSR Project Incentives What are TSR Project Incentives? Project Incentives temporarily removed when Transmission Service Rate began April 1 st, 2006 Transmission Service Rate (TSR) Incentives launched April 1 st, 2008 to provide a price signal beyond the 10% allocation of Tier 2 energy Tier 2 = $73.60/MWh (F09) $/MWh Tier 1 = $24.62/MWh (F09) MWh T1/T2 Split = 90 CBL = 100

31 TSR Project Incentive Offer Incentive rate = $ /kWh (average) Maximum incentive of $500,000 per project Incentive capped at 1-year energy only Pay Back (PB) No Maximum % of project cost limitation Pre-incentive PB of ~<6 years buys down to 1 year BC Hydro Power Smart performs Measurement & Verification (M&V) for the project Customer Baseline Load (CBL) is reduced by the M&V energy savings

32 TSR Project Incentive - Eligibility All Industrial Transmission Service Rate customers qualify regardless of position in CBL Includes customers on RS 1823 and RS 1823A Incentives for capital projects only Minimum persistence of 5 years Project savings must be greater than 0.3 GWh/year Project PB must be greater than 1 year pre-incentive

33 Sample Incentive Calculation Project Energy Savings = 3 GWh/yr Project Persistence = 10 years Incentive Amount: 3 GWh/yr * 10 years * $ /kWh ~ $400,000 Timing of incentive payments based on project progress 75% at project installation 25% after M&V Project PB pre-incentive > 1yr post incentive =1 yr

34 When you don t know where to start: 1) IDENTIFY Perform an Energy Audit or Customer Site Investigation to prioritize opportunities 100% Funded If you know of an end-use system with an opportunity: 1) IDENTIFY Perform an End-use Assessment to see if an Energy Study is worthwhile 100% Funded 2) INVESTIGATE Perform an Energy Efficiency Feasibility Study to build a business case up to 100% Funded The 3 I s 3) IMPLEMENT Receive Project Incentive Funds for your energy efficiency project up to 75% Funded

35 MILL Metering and Instrumentation Lending Library Available for loan, free of charge, for a three month period, to Industrial customers with electrical energy spend greater than $500,000/yr: Electrical meters Process flow meters Data loggers Ultrasonic Air Leak Detectors Infrared thermometer Displayed in our Industrial Tradeshow Booth

36 Recognition Package (early 09) Sign a Power Smart Partner Conservation pledge and BC Hydro will recognize your organization for your conservation achievements via promotions in print media and BC Hydro will recognize you for completing activities such as energy efficiency projects or energy studies with letters of recognition and plaques you can hang in your workplace

37 Case: Sawmill, 10 GWh/yr, 10% Reduction in 1 Year Energy Management Assessment Hire an Energy Manager Plant-wide Energy Audit (CSI) Perform an Energy Study Operational and Behavioural Improvements Implement an Energy Efficiency Project Result: $50,000/yr saved

38 What can you do? Act NOW by: Contacting your KAM Phone (Lower Mainland); or (elsewhere in BC) industrial@bchydro.com Take advantage of our fully funded offers: An Energy Management Assessment Customer Site Investigation (Plant-wide Audit) Energy Study fully funded promo

39 Thank You!

40 Energy Efficiency Feasibility Study Two contracting options: 1. You contract with consultant 2. BC Hydro contracts with consultant

41 How could these initiatives work for you? Ex.: Sawmill customer, 4 sites, consumption ~ 100 GWh/yr EMA Energy Manager Plant-wide Audit End-use Assessment Feasibility Study Project Implementations and Behavioural Changes 1 Yr

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43 Reimbursement Guidelines

44 Project Incentives Process 1) Submit a TSR Incentive application and proposal. Proposal includes project description with energy baseline, kwh savings (+/-10%) and project cost 2) BC Hydro reviews proposal and issues agreement (1-3 weeks) 3) Customer signs agreement and implements project 4) Customer submits completion documents and project is site inspected. 75% of incentive paid for Project Completion 5) Prorated CBL adjustment made for current year 6) 25% balance of incentive paid after M&V 7) CBL adjusted by full project savings for next fiscal year and updated for final M&V value

45 Example 1 - Compressed Air Project Project Cost = $350,000 Energy Savings = 1,000,000 kwh/yr = 5 /kwh Lifespan = 10 years Payback before incentive = $350,000 / ($50,000/yr) = 7.0 yrs 1) Incentive = (1,000,000 kwh/yr*10 yrs)*($0.025/kwh) = $250,000 3) Incentive to 1 year payback = $300,000 5) Incentive to 75% of project cost = $262,500 Therefore, this project is eligible for a $250,000 incentive Payback after incentive = = 2.0 years