Meeting the energy audit requirement of the Energy Efficiency Directive

Meeting the energy audit requirement of the Energy Efficiency Directive & introducing other headline elements of the implementing legislation including CHP provisions Enda Gallagher and Errol Close, Department of Communications, Energy and Natural Resources

The Energy Efficiency Directive

The Energy Efficiency Directive Its intent is sensible Energy efficiency is the energy game-changer Why?

The Energy Efficiency Directive Its intent is sensible Energy efficiency is the energy game-changer Why? Because it s available to all As the saying goes, the Stone Age did not end because we ran out of stones; we transitioned to better solutions. The same opportunity lies before us with energy efficiency and clean energy Stephen Chu

The Energy Efficiency Directive (EED) and EU Energy Targets The EED establishes a common framework of policy measures for the promotion of energy efficiency to ensure the achievement of the 20% energy efficiency target

The EED and Ireland s Targets Ireland s national E.E. target is 31,925 GWh or 20% saving by 2020 and 2.4bn Non compliance (re Article 7, 1.5% target see slide on Obligation Scheme) = EU fines

Lights, camera, action The National Energy Efficiency Action Plan

NEEAP the action pillars Public Sector Business Buildings Transport Energy Supply Crosssectional

The targets national

The targets public sector

The targets business sector

The Public Sector Target - 33% Fulfil exemplar role Minister to publish EE guidelines to sector Publish EE actions & assessment of savings Detailed data to SEAI SEAI public sector annual report Buy/lease - minimum A3 BER

The Public Sector OPW & OGP Energy inventory heated/cooled central gov t public buildings 250m sq July 15 Central gov t to only buy high energy performance products Public service contract tenders assessment of long term energy savings Public body 500m sq or 35k energy spend must comply with audits regs

Energy Supply CER to have regard to EE when making decisions on operation of electricity and gas systems CER to provide incentives in electricity systems for EE improvement CER to complete a national assessment of energy efficiency potential of electricity and gas trans and dist systems-30/6/2015 + the EE improvement measures in assessment to be timetabled

Energy Supply CER to amend licence conditions so as to reduce volume of distributed energy CER to ensure that tariffs reflect EE savings CER to ensure tariff incentives detrimental to EE are removed CER may approve schemes and tariff structures with a social aim CER to promote demand side resources CER to make system / grid services available for e.g. cogen etc.

Energy Demand Management Metering and Billing CER - mandated - smart metering systems and to licence condition time of use tariffs. Must ensure DSO provides final customers - electricity and gas smart metering system (actual and time of use) ensure new / re-build, final customers, electricity and gas individual meter CER - ensure accurate billing And free billing

The Business Sector Obligation Scheme CHP Energy Audits

Energy Efficiency Obligation Scheme Obligation Savings of 1.5% of annual energy sales to final consumers 1,469GWh.1,102GWh negotiated Options impose full 1.5% via an EEOS or impose part via EEOS + alt measures Sales higher than 600GWh 550GWh = EEOS target (7 years 3,850GWh) 75% Non Res, 20% Res, 5% Poverty Voluntary Agreement programme transitions Trading of energy credits buyout (max 30%, 6c, 20.4c and 88c per KWh) and penalty price (1.25 times the buyout price)

CHP & District Heating

CHP & District Heating Two aspects to be covered Regulations 23 to 25 Promotion of efficiency in heating and cooling Comprehensive national assessment Installation level assessment Regulation 26 Guarantees of Origin for high efficiency CHP

Promotion of efficiency in heating and cooling Comprehensive assessment (Reg 23(1) to (9)) To be undertaken by SEAI in accordance with Annex VIII of the Directive Assessing national potential for High Efficiency CHP and District heating Includes a cost benefit analysis in accordance with Annex IX of the Directive Include appropriate recommendations to encourage consideration and accommodate development Report to be completed by 30 June 2015

Promotion of efficiency in heating and cooling Installation level cost benefit analysis to be undertaken by the economic operator when the following criteria are met: - when planning to carry out particular activities in relation to electricity generation, refurbishment of industrial installations or district heating; - when seeking a license or revised license from the Environmental Protection Agency under Section 83 of the EPA Act of 1992

Activities requiring the installation level assessment Activity CBA Assessment Assess using CHP or waste heat recovery to To install a new thermal electricity generation installation with a total rated thermal input exceeding 20 MW that is not already a cogeneration unit; To substantially refurbish an existing thermal electricity generation installation with a total rated thermal input exceeding 20 MW and the refurbished unit will not be a cogeneration unit; Provide for the operation of the installation as, or conversion to, a high-efficiency cogeneration installation; To install or substantially refurbish an industrial installation with a total rated thermal input exceeding 20 MW generating waste heat at a useful Utilise the waste heat to satisfy economically justified demand, including through cogeneration, and of the connection of that installation to a district heating and cooling network; To construct a new district heating and cooling network or to install a new energy production unit with a total rated thermal input in excess of 20MW in an existing district heating or cooling network or to substantially refurbish an existing such installation and waste heat is not being used from nearby industrial installations. Utilise the waste heat from nearby industrial installations.

Preparation and assessment of the installation level CBA Installation cost benefit analysis to be prepared in accordance with Annex IX SEAI to prepare guiding principles Cost benefit analysis to be submitted to the SEAI who will assess taking account of: Comprehensive assessment Annex IX Actual activity versus the findings of the CBA SEAI shall publish notification of its assessment and invite submissions SEAI shall then issue a notification of the outcome of its assessment to the economic operator

Exemptions Exemption from undertaking a CBA The installation is of a class or at a location identified by the Comprehensive assessment as not having potential for the implementation of cost beneficial energy efficiency measures, The installation is an electricity generating station which is planned to operate under 1,500 operating hours per year as a rolling average over a period of 5 years, the installation needs to be located close to a geological storage site as permitted by the European Communities (Geological Storage of Carbon Dioxide) Regulations 2011 (S.I. No. 575 of 2011), or the installation is below any threshold designated by the Minister for the amount of available useful waste heat, the demand for heat or the distances between industrial installations and district heating networks Exemption from outcome of CBA The economic operator may make an application to the SEAI for an exemption from implementing the energy production option preferred under the cost benefit analysis for imperative reasons of law, ownership or finance.

Guarantees of Origin (GOO s) Guarantees of origin for electricity from High Efficiency CHP Similar process to that already in existence for GOO s for renewable generators Supervisory framework to be established by the CER for management of the system for issuance, registration, transfer and cancellation of GOO s provide for the recognition of GOO s issued by other Member States To be administered by SEMO in accordance with S.I.426/2014 and the CER supervisory framework

Guarantees of Origin (GOO s) Eligibility Only for electricity generated from high efficiency CHP Standard size 1MWh 1 GOO issued for each unit of electricity from high efficiency CHP Must be used within 12 months of the generation of the corresponding unit Each GOO will be cancelled once used Information to be provided to support a request for a GOO outlined in the statutory instrument Provisions for revocation included due to: the provision of incorrect information, fraudulent activity, The issuance of an inaccurate GOO a GOO issued to the incorrect party SEMO to publish any fees associated with GOO s on its website

Energy Audits The Working Plan

Energy Audits Part 3 of SI 426/2014 Mandatory element applies to non-smes i.e. more than 250 employees Or Turnover > 50m and an annual balance sheet > 43m Multi-site organisations must identify their total energy use in Ireland, and ensure that 90% of this is covered by energy audit

Compliance Requirements Buildings, operations, and transport Cover at least 90% of total energy use Reporting to the SEAI must be completed by the compliance date (5 th December 2015) If no audit, may be asked for evidence why

Exemptions: ISO 50,001 ISO 50,001 certification indicates compliance, but only if the ISO 50,001 covers at least 90% of the energy use (measured in kwh or cost) If not, then activities, buildings, and transport outside the scope of the ISO 50,001 certification must be audited also In all, at least 90% of the energy consumption of the organisation must be covered by an energy audit

Exemptions: ISO14,001 Environmental management systems such as ISO14,001 may also be exempt, if an energy aspect is explicitly included in the scope and covers at least 90% of energy use These organisations must still report compliance, identifying the basis of the exemption

Priority Requirements A National Registration Scheme for Energy Auditors, independently run and supervised Transparent access to it National minimum standards for energy audits The availability of sufficient auditors to meet the need

National Registration Scheme SEAI to operate Can farm out aspects Phased development Registration Process Clear qualification requirements, open access Application received and evaluated Meets requirements certified SEAI website page lists qualified auditors for classes of audit, starting with large business

Minimum Criteria for Audits Minimum criteria for energy audits including those carried out as part of energy management systems The energy audits referred to in Article 8 shall be based on the following guidelines: (a) be based on up-to-date, measured, traceable operational data on energy consumption and (for electricity) load profiles; (b) comprise a detailed review of the energy consumption profile of buildings or groups of buildings, industrial operations or installations, including transportation; (c) build, whenever possible, on life-cycle cost analysis (LCCA) instead of Simple Payback Periods (SPP) in order to take account of long-term savings, residual values of long-term investments and discount rates; (d) be proportionate, and sufficiently representative to permit the drawing of a reliable picture of overall energy performance and the reliable identification of the most significant opportunities for improvement. Energy audits shall allow detailed and validated calculations for the proposed measures so as to provide clear information on potential savings. The data used in energy audits shall be storable for historical analysis and tracking performance.

Qualification/Accreditation of Auditors Competence shall be evidenced using a combination of experience and qualifications. SEAI are developing list of minimum qualifications for various activities Auditors must register with SEAI s national registration system SEAI will manage a database of approved auditors In house auditors must also be registered and independent they must not be working in the area they audit State must train up Art 16

Overall Principles of S.I. 426/2014 Aim is high quality energy audits, deep and effective in line with Annex VI of Article 8 Key criteria are quality, transparency, independence and auditor competence Member State (MS) determines what is sufficiently qualified auditor Audit is to be independent i.e. external or internal auditor independent of entity or process being audited Auditor is to be accredited, qualified and certified MS must ensure sufficient expertise and capacity of certified auditors (internal or external)

Overall Principles of S.I. 426/2014 Scope is all energy across buildings, processes and transport MS must put in place means to demonstrate compliance MS determines what is reasonable or representative of total energy use e.g. audit 90% of total Where a certified EnMS or EMS is the alternative, the obligated organisation must include a high quality energy audit that fulfils the requirements of Annex VI Results must be communicable i.e. a closed PDF report would need to be accompanied by data / spreadsheet NB SP - Simple Payback is no longer acceptable, LCCA is the preferred methodology

The EED Reward Factor! 2.4 billion