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City of Boulder Meeting Kyoto -- Carbon Emissions Reduction: Commercial Lighting. Discussion Overview. State of Play Project Overview - Analysis I Project Development and Goals Model Review Energy Efficiency Model Development and Overview Findings and Implications Key Assumptions - PowerPoint PPT Presentation
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City of BoulderMeeting Kyoto -- Carbon Emissions Reduction:
Commercial Lighting
August 2009 Slide: 2
Discussion OverviewState of Play
Project Overview - Analysis I Project Development and Goals
Model Review Energy Efficiency Model Development and Overview
Findings and Implications
Key Assumptions
Areas for Model Refinement
Derivation of Potential and Cost of Efficiency Technical, Economic and Achievable Potential
Cost of Efficiency Example Calculation
Levelized Cost of Energy
Questions and Discussions
State of Play
August 2009 Slide: 4
State of Play
0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
1800000
2000000
2200000
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
GH
G E
mis
sio
ns
(mtC
O2)
Electricity Natural Gas Landfill Gas Vehicle Fuel Offsets
7% Below 1990
2004 Forecast
417,750 ton
gap
Current Forecast
City of Boulder Emissions Projections by Source
Project Overview
August 2009 Slide: 6
Project Inception Project Identification
Commercial sector poses a significant amount of energy efficiency potential Increasing energy efficiency in commercial buildings is among
the most cost-effective ways of reducing energy use and the associated carbon emissions
Project Development Project ID prompted the proposal and development
of a commercial energy efficiency potential model to: Determine the feasible range of delivered cost per
metric tonne of CO2 reductions
Determine the anticipated metric tonne reduction for a given investment
August 2009 Slide: 7
Analysis I - Delivered Price per mt CO2 Assessment
Analysis I set out to answer the questions:
1. What is Boulder’s cost for delivered CO2 (cost CO2/metric tonne reduced)?
2. What are each of the components that make up the delivered CO2 price?
3. How much CO2 reduction can be expected with a given investment?
4. What influence does industry type, building type, etc. have on CO2 price?
August 2009 Slide: 8
Analysis I - Approach Basis
Various energy efficiency potential studies and data sets exist Itron 2006 California Energy Efficiency Potential Study DEER (Database for Energy Efficiency Resources) NYSERDA’s 2003 study for New York State E-Source / Platts California Commercial End-Use Survey Others…
Integrate City of Boulder data Develop the model to reflect Boulder’s
Climate zone Building stock Energy mix Consumption projections Program Development Others…
Model Review
August 2009 Slide: 10
Model Overview
August 2009 Slide: 11
Analysis I - Findings Boulder’s Budget Required for Achievable Potential ≈
$480,000 (Boulder’s LCOE: $0.0035/kWh)
Boulder’s Achievable Potential Year 3 ≈ 9,000 mt CO2Total Boulder energy consumption in Year 3 = 1,118,452 MWh
Total Technical Energy Efficiency Potential in year 3 88,460 MWh
% of year 3 Commercial energy consumption 7.9%
% of year 3 Total City of Boulder System energy consumption 6.2%
Power 12 MW
Total Economic Energy Efficiency Potential in year 3 81,194 MWh 71,229 mt CO2 Budget category budgetLCOE($/kWh)
% of year 3 Commercial energy consumption 7.3%Boulder cost(PV, EM&V)
$3,782,440 $0.0035
% of year 3 Total City of Boulder System energy consumption 5.7% System $36.38 Xcel tech cost $11,328,406 $0.0102
Power 11 MW Boulder $3.96 Customer cost $19,315,757 $0.0182
Total Achievable Energy Efficiency Potential in year 3 10,422 MWh 9,126 mt CO2 Budget category budgetLCOE($/kWh)
% of year 3 Commercial energy consumption 0.9%Boulder cost(PV, EM&V)
$481,341 $0.0035
% of year 3 Total City of Boulder System energy consumption 0.7% System $36.38 Xcel tech cost $1,445,492 $0.0102
Power 1 MW Boulder $3.96 Customer cost $2,454,182 $0.0182
Total system budget required in Year 3
Technical Potential
$4,375,825
$34,385,815
Total system budget required in Year 3
Economic Potential
Achievable Potential
Cost of Carbon($/ mt CO2 reduced)
Cost of Carbon($/ mt CO2 reduced)
August 2009 Slide: 12
Analysis I - Findings Boulder’s Annual Budget Target = $400,000
=> Associated Annual CO2 Savings 8,300 mt CO2
Total Technical Energy Efficiency Potential in year 3 88,460 MWh
% of year 3 Commercial energy consumption 7.9%
% of year 3 Total City of Boulder System energy consumption 6.2%
Power 4 MW
Total Economic Energy Efficiency Potential in year 3 81,194 MWh 71,229 mt CO2
% of year 3 Commercial energy consumption 7.3%
% of year 3 Total City of Boulder System energy consumption 5.7%
Power 11 MW
Total Achievable Energy Efficiency Potential in year 3 9,477 MWh 8,314 mt CO2
% of year 3 Commercial energy consumption 0.8%
% of year 3 Total City of Boulder System energy consumption 0.7%
Power 1.3 MW
Total System Budget Required
$34,385,815
Achievable Potential
Total System Budget Required
$3,640,677
Existing Commercial
Technical Potential
Economic Potential
Year City of Boulder Budget
Total System Budget
Achievable Potential Towards Target (mt CO2)
Percent of Total Load
Year 1 $368,509 $3,354,060 7,878 0.6%
Year 2 $400,000 $3,640,677 8,408 0.7%
Year 3 $400,000 $3,640,677 8,314 0.7%
Year 4 $400,000 $3,640,677 8,309 0.7%
Year 5 $400,000 $3,640,677 8,193 0.7%
Year 6 $400,000 $3,640,677 8,204 0.7%
Year 7 $362,500 $3,299,367 7,590 0.6%
Year 8 $183,338 $1,668,686 3,770 0.3%
Year 9 $77,079 $701,546 1,534 0.1%
Year 10 $29,957 $272,661 566 0.0%
August 2009 Slide: 13
Analysis I - Findings Boulder Lighting Energy Efficiency Potential by
Building TypeMWh savings by building type and end-use
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Small O
ffice
Larg
e Offi
ce
Reta
il
Health
Scho
ol
College
Misc
Restau
rant
Hotel
Groce
ry
MW
h s
avin
gs c
um
ula
tive t
o T
arg
et
Year
Refrigeration
Misc
Lights
HVAC
Cooking
August 2009 Slide: 14
Analysis I - Findings Boulder’s Program Administration Costs
Model Baseline ≈ 11% of measure costs Analysis - 1%
Project Management - 3%
Strategic Positioning - 2%
Sales - 4%
Education an/Outreach - 1%
Compare to utility Demand Side Management/EE Programs
PA Costs modeled in range of the national average (10-18%) but above "best-in-class" utilities, which have more experience running programs than does the City of Boulder PG&E SCE SDG&E CA Total Other Utilities
Gross Program Costs $8,916,986 $15,762,067 $4,390,326 $29,069,379Net Measure Costs $299,159,822 $359,197,092 $115,383,448 $773,740,362Gross Incentives $94,911,995 $99,328,120 $37,375,867 $231,615,982
Program / Measure 3% 4% 4% 4% 10-18%Incentives / Measure 32% 28% 32% 30% 40-70%
August 2009 Slide: 15
Analysis I - Implications Commercial lighting has significant EE potential
Boulder’s building stock is well positioned (i.e. significant savings from a few building types)
Small Office, Large Office, Retail and Health Care ≈ 87% of Achievable Potential
Targeted commercial EE can provide measurable and verified emission reductions
Cost sharing makes the commercial EE options more appealing for all stakeholders
Multi-party appeal
Understanding market segmentation will be critical for program development and sustained emission reductions.
August 2009 Slide: 16
Analysis I - Implications System-wide Levelized Cost of Energy (LCOE) at
$0.032/kWh, is comparable to leading industry analyses.
City of Boulder’s Cost of Carbon at $3.96/mt CO2,
is significantly less than worldwide carbon market cost of carbon (e.g. EU ETS at ≈ $20.8/mt CO2 on
Aug 18, 2009)
Achievable lighting efficiency has the potential to reduce overall commercial lighting energy use by 5%*
Achievable lighting efficiency has the potential to achieve nearly 12%* of Boulder’s commercial emissions reduction goal
* Based on conservative Achievable Potential and “Ramp-up” percentages. Includes all energy savings from year 1, 2 and 3
August 2009 Slide: 17
Key Model Assumptions Data set corrects for any measure double counting
(i.e. measure XX negates the savings potential from measure YY)
Only readily available commercially implemented and proven measures included in model (i.e. no singular or extreme cutting-edge technologies)
System Consumption Projections: ≈ ½ % per year growth
Cost of CO2 offsets: $20/mt CO2
Boulder Discount Rate: 2.04%
Ratepayer Discount Rate: 3.0%
Boulder’s Program Administration Costs: 11%
August 2009 Slide: 18
Areas for Model Refinement As data becomes available:
Program Administration Costs Sales, Analysis, Project Management, etc.
Utility and Federal Incentives Achievable Potential
Boulder’s technology saturation, customer acceptance, etc.
Achievable Potential Ramp-up Investment/Benefit change over time
Lighting Technology cost Anticipate reduced costs as technology
gains mainstream market acceptance
Derivation of Potential and Cost of Efficiency
August 2009 Slide: 20
Technical Potential
Boulder Building Stock
• Energy consumption forecast
• Commercial energy use break down by building type (sources: CBECS, Boulder)
• End use breakdown by building type(sources: PLATTS, CEC CEUS)
Efficiency Measure Data(by building type and climate zone)
• Measure lifetime• Annual savings (kWh/unit)• Measure cost ($/unit)• # of units in building type
To
p d
own
Bo
ttom
up
Technical Potential
August 2009 Slide: 21
Economic Potential
Total Resource Cost (TRC) =
System Avoided Costs
System Costs
TRC< 1
> 1
Not included in Economic Potential
Economic Potential (kWh/year)
Customer:Avoided retail rate
of electricity
Xcel:avoided cost of generation or
wholesale purchase price
City of Boulder: avoided cost of
carbon offset
System Avoided Costs
Customer:Measure costs,
net of rebate
Xcel:rebate, lost revenue
City of Boulder: Program administration
costs
System Costs
August 2009 Slide: 22
Achievable Potential
EconomicPotential(kWh/year)
Achievable Factor (% achievable, by end
use and bldg type)
Achievable Ramp-Up Factor (% achievable by year)
x x=
CO2 Intensity(m tons CO2/kWh)x =
Achievable Potential (kWh/year)
Achievable Potential (kWh/year)
Achievable CO2
Savings(m tons/year)
August 2009 Slide: 23
Derivation of Cost of EfficiencyExample: Occupancy Sensor in Small Office
Source data for cost and performance of efficiency measures: Itron’s 2006 report “California Energy Efficiency Potential Study”Each measure defined as:
Example for City of Boulder:
Technology Occupancy sensor - plug load
End-use Lighting
Building type Small Office
Climate zoneCalifornia Energy Commission Climate Zone 16 (“high, mountainous, semiarid region above 5,000 feet in elevation”)
August 2009 Slide: 24
Derivation of Cost Example: Occupancy Sensor in Small Office
*Program Administration (PA) costs defined as % of measure capital cost:
Analysis (1%) Project Management (3%) Sales (2%) Strategic Positioning (4%) Education / Outreach (1%)
Efficiency Measure/Bldg. Type
Occupancy Sensor/Small Office
Measure energy savings per year 789 kWh per year per unit
Measure cost $169.20 per unit
Measure lifetime 8 years
City of Boulder Data Used for Cost Analysis:
Discount rate 2.04%
Program administration costs* Total of 11% of measure cost
August 2009 Slide: 25
Derivation of Cost Example: Occupancy Sensor in Small Office
Levelized Cost of Energy (LCOE) is the lifecycle cost of a measure, amortized over the measure’s lifetime, divided by the measure’s lifetime energy savings.
LCOE = [PMT(1) (measure cost + PA costs, @ Boulder’s discount rate, measure lifetime)]
[(energy savings/year) × (lifetime)]
Occupancy sensor in small office:
LCOE = [PMT(1) ($169.20 + (11% × $169.20),
@ 2.04%, 8 years)]
[(789 kWh/year) × (8 years)]
= $0.033/kWh
(1) PMT is a function that calculates the payment for a loan based on constant payments and a constant interest rate, using the present value of all future payments, the interest rate, and the number of payments (years) for the loan.
measure cost PA Costs
discount rate lifetime
energy savings/year lifetime
$ 25.96788.9 kWh
=
August 2009 Slide: 26
Derivation of Cost Example: Occupancy Sensor in Small Office
How does this compare to the levelized costs of the rest of the measures modeled?
Energy Efficiency Marginal Cost Curve
$0.000
$0.020
$0.040
$0.060
$0.080
$0.100
$0.120
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000
Cumulative Savings per Unit (kWh)
Leveli
zed
Cost
of
En
erg
y (
LC
OE)
- $/k
Wh
$0.033/kWh
Measures costing more than ≈$0.12/kWh are not economic ($0.12 = customer rate + city's avoided cost of CO2 offset alternative)
August 2009 Slide: 27
System Cost Breakdown
Xcel Costs =
Customer Costs =
Boulder Program Administration Costs = % of Total Measure Cost
Units Installed x Measure Cost per Unit —
Units Incentivized x Incentive per UnitIncentive
Cost =
Incentive Cost
Overall costs are further broken down by stakeholder:
Thank You!
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