Overview of Work Point Energy Efficiency Retrofit Project (Using an ESCO Facilitator) 17 November 2015 Christopher Seeley
Facilitator Background Energy Efficiency Building Retrofit Program - Clinton Foundation (2007-2013) 153 Projects >US$250 million (8,960,520,000 THB) 1. Thailand 2. Japan 3. Korea 4. Hong Kong 5. China 6. Indonesia 7. Philippines 8. Malaysia 9. Vietnam 10. Singapore 11. Melbourne Private Sector: Citibank (Thailand, Malaysia, Philippines, Singapore, Korea, Tokyo) Mandarin Oriental Group (Philippines, HK, Tokyo) Central Group, Thailand Trisara Resort, (Phuket) Exchange Tower (Bangkok) Interchange 21 (Bangkok) Six Senses Group (Thailand) International School of Bangkok (ISB) Bamrungrad Hospital Sikarin Hospital Four Seasons Hotel Group Intel, Vietnam MTR Corporation, Hong Kong Gran Melia Hotel Jakarta Hong Kong University, Hong Kong Century Properties, Philippines Government: Tokyo Metropolitan Administration Seoul Metropolitan Administration Department of Finance, Philippines Jakarta City Government, Indonesia City of Melbourne, Australia
The ESCO Concept An ESCO should be able to provide ALL the following services: 1. Energy Audits (IGA s) 2. Project Design and Management 3. Performance Guarantee 4. Operations and Maintenance (O&M) 5. Training 6. Measurement and Verification (M&V)
Benefits of Using a Facilitator Why is there a role for a Facilitator? The ESCO model can offer a very good business model for a building owner to reduce energy consumption, reduce costs, and replace old equipment, requiring no capital, and having very low risk. There is a long history of successful projects all over the world for over 40 years. There are also many examples of failed projects, conflicts, and even court cases It is a very complicated model with many risks MAIN RISKS 1. Technical and Technology Risk 2. Financial and Costing Risk 3. Legal/Contract Risk
Role of a Facilitator 1. Represent the Clients (Building Owners ) interests 2. Establish procurement process, scope of works, and timeline for project 3. Gather all site information energy consumption, operation hours, trends, list of equipment, etc 4. Prepare all project documents (Pre-qualification, evaluation forms, agreements, Energy Performance Contract (EPC), 5. Undertake Financial due diligence to ensure pricing represents fair market pricing 6. Undertake Technical due diligence to ensure technical recommendations are sound - [Best Available Technologies] 7. Undertake Quality due diligence to ensure recommended manufacturers and brands are reliable, proven, warranties are clear, etc 8. Identify and explore financing sources, options, and any added benefit (eg. grants, tax exemptions, etc) 9. Prepare summaries, options, and recommendations for Client to make well-informed decision 10. All project Communication, Co-ordination, and Project Management
ESCO Process 1. Initial meeting with Building Owner and Facilitator 2. Data Collection and Baseline 3. Pre-Qualification of ESCOs 4. 3 ESCOs undertake Preliminary Assessment of Building 5. Presentation and Evaluation of Preliminary Proposals 6. 1 ESCO to undertake IGA 7. EPC signed and Implementation begins 8. Measurement & Verification (M&V)
Work Point
Work Point Project Process Pre-Qualification + Prelim Energy Audit ESCO #1 ESCO #2 ESCO #3 ESCO #4 Evaluation + Clarification of Information/S olutions ESCO #1 ESCO #2 ESCO #3 Evaluation + Selection for Investment Grade Audit ESCO A Energy Performance Contract Final selection of ECMs & Negotiation of Contract Implementation M&V
Preliminary Proposal Main Contents 1. Site description / Overview of site 2. Energy consumption breakdown 3. Brief description of Energy Conservation Measure (ECM) 4. Estimated Investment 5. Estimated Energy Savings 6. Estimated Energy Cost Savings 7. Simple Payback 8. Project Summary 9. ESCO Model (GS, SS, PG) 10. Fee for undertaking IGA ALL Energy Cost Savings to use X.xx THB/kWh Chiller plant operating hours as provided Lighting operating hours as provided Baseline Consumption April 2014 April 2015 Assumption that M&V will follow IPMVP Prelim Proposal NOT MORE than 25 pages (Word / Ppt/Pdf)
LIST OF DOCUMENTS 1. Pre-qualification of ESCOs 2. Evaluation Sheet for Pre-qualification 3. List of Information requested Equipment list, hours of operation, issues with breakdowns/frequent servicing, replacement plans Corporate targets, reporting requirements 4. Evaluation Sheet for Preliminary Proposal 5. Investment Grade Audit (IGA) Agreement 6. Energy Services Performance Contract
Project Description and Solutions
Expert Advisory Committee ECFT
Site Information Chiller Plant 4 chillers (water cooled) 4 sets of chilled water pumps (CHWP), 4 sets of condenser water pumps (CWP) 4 sets of cooling towers Usual operation is 1 or 2 sets of chillers. Chillers operate 10-12 hours per day Lighting Compact Fluorescent Fluorescent T8 tubes Dedicated studio lighting Halogen downlights Par 38 Metal Halide
Plant Operation Data Duration Operation hour/month Operation hour/month Operation hour/month Operation hour/month Operation hour/month Operation hour/month Operation hour/month Operation hour/month CHP 1 CHP 2 CHP 3 CHP 4 CDP 1 CDP 2 CDP 3 CDP 4 Jan 128 144 105 42 144 144 89 38 Feb 144 160 138 111 137 176 137 111 Mar 176 160 131 108 176 160 146 97 Apr 191 162 82 61 191 161 91 49 May 128 160 22 29 128 160 21 29 Jun 184 230 66 0 184 230 66 0 Jul 160 192 34 24 160 192 34 24 Aug 158 172 82 53 160 174 83 50 Sep 158 172 82 53 160 174 83 50 Oct 158 172 82 53 160 174 83 50 Nov 158 172 82 53 160 174 83 50 Dec 158 172 82 53 160 174 83 50
Layout/Diagrams Cooling Tower Plant Chiller Plant Diagram
Sample Energy Efficiency Solutions
Energy Conservation Measures (ECMs) 1. Chiller Plant Upgrade 2. Chiller Plant Management System 3. Lighting
Baseline & Chiller Plant Performance Chiller plant system has efficiency of 0.907 kw/ton Opportunity to improve efficiency to 0.780 kw/ton Total 13% saving 13% = 810,000 THB per year COMPONENT BRAND EFFICIENCY (kw/ton) Chiller 400 tons TRANE 0.637 PUMP CHP1 BROOK 0.188 PUMP CDP1 BROOK 0.055 Cooling Tower CT-1 SF-JVW 0.028 Total kw/ton 0.907
Sample ECMs Chiller Pumps Control Saving Solution
Chiller Plant Management System Architecture
COMPACT FLUORESCENT LED Replacement Quantity (unit) Hours of Operation per Day 24 System (Watt) Price (THB) Total Cost (THB) Compact Fluorescent 18 LS CLA60 7.5W/827 220-240V FR 908 7.5 187.20 169,977.60 LS CLA60 7.5W/827 220-240V FR E27 Watt Difference 58.33% 10.5 Electricity saving per year (THB) 335.66 304,782.91 Maintenance per year Total saved per year (THB) 335.66 304,782.91 Payback (yr) 0.56
Project Summary TOTAL INVESTMENT THB XX,xxx,xxx THB X,xxx,xxx THB X,xxx,xxx TOTAL ENERGY SAVINGS (kwh/year) 520,045 189,988 324,000 TOTAL ENERGY COST SAVINGS (THB/year) THB X,xxx,xxx THB X,xxx,xxx THB X,xxx,xxx ROI (years) 5.56 4.99 3.33 TOTAL ENERGY SAVINGS (%) 11% 4% 7% TOTAL CO2 REDUCTION (tons CO2e/year) 296 70 164 ESCO Delivery Model Performance Guarantee??? Guaranteed Savings M&V Chiller plant efficiency??? IPMVP Option A O&M training to Workpoint's staff n/a n/a IGA Fee THB 100,000 THB 100,000 n/a THB/kWh Saved 25.23 16.32 11.70
Sample Evaluation Evaluation of ESCO + Preliminary Proposal Work Point Energy Efficiency Retrofit Project # ASSESSMENT CRITERIA Qualitative Evaluation of ESCO POINTS Available ESCO #1 ESCO #2 ESCO #3 xxxxxxxx xxxxx xxxxx Overall experience and technical expertise in EE and ESCO projects (references) 1 Years of Experience in the ESCO sector in Thailand 3 1 2 2 2 Number of ESCO projects that you have delivered in the past 3 years 3 1 1 3 3 General ESCO-related experience (broad range of experience) 5 2 2 3 4 Number of staff that you have in your company in Thailand? 3 3 3 3 5 Expertise in your company (technical, financial, project management) 14 11 3 5 COMMENTS 6 The projects that you have completed to demonstrate relevant ESCO experience within the past 3 years --- --- --- --- Project #1 (1+9+4+14+4+3+2+3=40)/10 4 1.4 2 2.1 Project #2 (1+9+4+14+4+3+2+3=40)/10 4 2.1 2.1 1.8 7 Quality Management System that you have certified 1 1 1 0 8 Partners (technical partners, manufacturer partners, supplier partners, finance partners) [more partners suggest the ability to deliver a large comprehensive project better] 4 0 0 4 9 ESCOs are required to demonstrate that they have the financial capacity to provide all the requirements specified in this Invitation. 1 1 1 1 Sub Total 42 23.5 17.1 24.9
Sample Evaluation Evaluation of ESCO Pre-Qualification + Preliminary Proposal Work Point Energy Efficiency Retrofit Project POINTS # ASSESSMENT CRITERIA Available ESCO #1 ESCO #2 ESCO #3 Xxxxx Xxxxx Xxxxx COMMENTS 10 Technical and Site Specific Approach Comprehensive Approach HVAC, lighting, BAS/BEMS, building 4 2 1 1 envelope, hot water, renewable energy, etc 11 Depth/Detail of recommended energy savings measures 4 2 2 1 12 Analysis of electricity structures, peak/off-peak tariffs and ability for cost reduction 1 0 0 0 13 Commissioning/retro-commissioning of existing equipment 2 1 1 0 14 Innovation & Creativity (Eg. tri-generation, renewables, waste heat recovery, light tube, occupancy sensors, etc) 3 1 1 0 15 Solution specific vs. product/brand specific 3 1 0 1 16 Overall demonstration of understanding of Building Owner's interests/objectives/criteria/expectations 4 3 2 1 17 Overall understanding of the building's issues/operations 3 2 2 1 18 Overall Quality of the Prelim Assessment Report/Presentation 3 2 2 1 Sub Total 27 14 11 6
Sample Evaluation Evaluation of ESCO + Preliminary Proposal Work Point Energy Efficiency Retrofit Project # ASSESSMENT CRITERIA POINTS Available ESCO #1 ESCO #2 ESCO #3 Xxxxx Xxxxxx Xxxxxx Projected Costs, Savings, and other Economic Factors 19 Total Investment Ratio of project (Eg. THB/kWh saved) 5 2 3 4 20 Total savings from implementation of project (% reduction) 5 3 1 2 21 Total CO2 reduction 2 2 1 2 22 Operations and maintenance cost savings 3 3 1 2 23 Cost effectiveness - Payback period 5 3 2 1 24 Fee for undertaking Investment Grade Audit (IGA) 1 1 1 0 COMMENTS Sub Total 21 14 9 11 Overall Approach 25 Overall approach to Project/Management/Communication 5 3 4 2 26 Overall feeling/response to ESCO 5 3 4 2 Sub Total 10 6 8 4 Total 100 57.5 45.1 45.9
Project Steps and & Timeline Activities/Month July August September October November Week 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 Meeting with Building Owner Collection of Facility Information Kick-Off Meeting Walk-through of Facility Prequalification of ESCOs Prelim Audit Report/Proposal Evaluation of Prelim Proposal Investment Grade Audit Contract Implementation M&V
Conclusion Very large potential for the ESCO market in Thailand and across SEA Strong ESCO expertise and experience in Thailand But there are many barriers and challenges that a Facilitator can assist with The ESCO Model is complicated and has many variables /models Lack of ESCO Project Process and Structure Lack of Capacity (all stakeholders) Lack of confidence in ESCOs Lack of adoption of M&V standards Lack of ESCO certification (industry standards) Lack of information/transparency Building owners see the value & appreciate ESCO Facilitators (however, most of the time this is only at the end of the project)
THANK YOU Christopher Seeley Climate Change Solutions Co Ltd. ccseeley@climate-change-solutions.net +66 87 806 0880