Demand side management for commercial buildings using an inline heat pump water heating methodology

Energy Conversion and Management 45 (2004) 1553–1563www.elsevier.com/locate/enconman

Demand side management for commercial buildings using aninline heat pump water heating methodology

Riaan Rankin *, Pieter G. Rousseau, Martin van Eldik

School of Mechanical and Materials Engineering, Potchefstroom University for Christian Higher Education,

Private Bag X6001, Potchefstroom 2520, South Africa

Received 16 April 2003; accepted 19 August 2003

Abstract

Most of the sanitary hot water used in South African buildings is heated by means of direct electrical

resistance heaters. This is one of the major contributors to the undesirably high morning and afternoonpeaks imposed on the national electricity supply grid. For this reason, water heating continues to be of

concern to the electricity supplier, ESKOM.

Previous studies, conducted by the Potchefstroom University for Christian Higher Education in South

Africa, indicated that extensive application of the so called inline heat pump water heating methodology in

commercial buildings could result in significant demand side management savings to ESKOM. Further-

more, impressive paybacks can be obtained by building owners who choose to implement the design

methodology on existing or new systems.

Currently, a few examples exist where the design methodology has been successfully implemented.These installations are monitored with a fully web centric monitoring system that allows 24 h access to

data from each installation. Based on these preliminary results, a total peak demand reduction of 108

MW can be achieved, which represents 18% of the peak load reduction target set by ESKOM until the

year 2015. This represents an avoided cost of approximately MR324 (ZAR) [Int J Energy Res 25(4)

(1999) 2000].

Results based on actual data from the monitored installations shows a significant peak demand re-

duction for each installation. In one installation, a hotel with an occupancy of 220 people, the peak

demand contribution of the hot water installation was reduced by 86%, realizing a 36% reduction in peakdemand for the whole building. The savings incurred by the building owner also included significant

* Corresponding author. Tel.: +27-18-299-4025; fax: +27-18-299-1320.

E-mail addresses:[email protected] (R. Rankin), [email protected] (P.G. Rousseau), mgimve@puk-

net.puk.ac.za (M. van Eldik).

0196-8904/$ - see front matter � 2003 Elsevier Ltd. All rights reserved.

doi:10.1016/j.enconman.2003.08.020

mail to: [email protected]

1554 R. Rankin et al. / Energy Conversion and Management 45 (2004) 1553–1563

energy consumption savings due to the superior energy efficiency of the heat pump water heater. The

combined savings result in a conservatively calculated straight payback period of 12.5 months, with an

internal rate of return of 98%.

The actual cost of water heating is studied by comparing the cost of supplying 1 kWh of thermal

energy by either a conventional electrical resistance heater or a heat pump heater. The cost for one of the

installations, based on the cost of kilowatt-hour consumption as well as peak demand contribution,

showed a decrease in cost from 35.4 c/kWh (ZAR) to 7.4 c/kWh (ZAR).

This paper presents data from these actual installations, where the issues of demand side managementand energy cost reduction are addressed.

� 2003 Elsevier Ltd. All rights reserved.

Keywords: Inline heating methodology; Heat pump; Demand side management; Thermal kilowatt-hours; Sanitary hot

water; Peak electrical demand; Energy efficiency

1. Introduction

Unlike the United States of America and most European countries, South Africa has very fewaccessible commercial supply networks of natural gas. Therefore, most of the sanitary hot waterused in South African buildings is heated by means of direct electrical resistance heaters. This isone of the major contributors to the undesirably high morning and afternoon demand peaksimposed on the national electricity supply grid. For this reason, water heating continues to be ofconcern to ESKOM, South Africa�s only electrical utility company.

Previous studies [1] conducted by the Potchefstroom University for Christian Higher Educa-tion in South Africa, funded by ESKOM Technology Services International (TSI), indicated thatextensive application of the so called inline heat pump water heating methodology in commercialbuildings could result in significant demand side management savings to ESKOM. Furthermore,impressive paybacks can be obtained by building owners who choose to implement the designmethodology on existing or new systems. Monthly savings can be obtained by these buildingowners due to a significant decrease in the building peak electrical demand, as well as a decreasein the building energy consumption due to the superior energy efficiency of heat pump waterheaters.

These preliminary results prompted the need for a demonstration project to determine thepotential of the methodology and to establish it as a proven concept in practice, supported byreferences to various successful systems. The impacts of variations in building type, hot waterstorage capacity and hot water consumption profiles, as well as geographical location andclimate need to be investigated. This is done through the retrofit installation of various hotwater facilities in commercial buildings, such as hotels, hospitals and university residences withvarying occupancy and storage capacity in different climatic regions. These installations arenow monitored continuously, and the results are used to determine the impacts of all thevariables involved, as well as the continuous upgrading of the control algorithms of the system,to be able to realize the full demand side management and energy saving potential. This paperwill focus on the results obtained during the demonstration phase for three different installa-tions.

R. Rankin et al. / Energy Conversion and Management 45 (2004) 1553–1563 1555

2. Methodology

2.1. Conventional design philosophy

At present, most of the water heating plants in South African commercial buildings are basedon the conventional intank configuration shown in Fig. 1. Surveys showed that most of theseinstallations are designed according to guidelines set by EPRI [2] and ASHRAE [3]. This con-figuration has electrical heating elements and a control thermostat installed inside the reservoir,usually near the bottom.

In the intank configuration, the water is heated gradually at the bottom of the reservoir and thesupply water is drawn from the top. This means that whenever hot water is drawn from the top,cold water entering at the bottom of the reservoir will lower the temperature at the thermostat.The thermostat will then call for the full heating capacity to be activated. This configuration,therefore, causes the system to activate the full heating capacity whenever hot water is demandedby the building occupants. The effect of this is, therefore, that the electrical demand profile for theinstallation shows distinctive morning and afternoon peaks, which coincide with the peaks as-sociated with the typical sanitary hot water consumption profiles for both domestic and com-mercial buildings [3,4]. This is one of the major contributors to the undesirably high morning andafternoon demand peaks imposed on the national electricity supply grid.

The fact that the heating is done at the bottom implies that the water in the reservoir is usuallywell mixed [5,6], leading to the average water temperature being lower than the set point value.This is not an ideal situation to have during a peak water demand period. Furthermore, if thereservoir is filled with cold water after a prolonged period of water usage, practically all of thewater in the reservoir needs to be reheated to the desired temperature before any of the hot wateris available at that temperature. This design philosophy, therefore, requires that the heater mustbe able to reheat the total content of the reservoir within a short period, typically 3–4 h, implying

T

Supply water

Feed water

Storage tank

Heaterelements

Thermostat

Fig. 1. Conventional intank heating configuration.


that a large heating capacity is needed to meet this requirement. Through an extensive surveydone as part of this project, the total installed heating capacity in commercial buildings in SouthAfrica has been found as typically 0.7 kW/person.

2.2. Improved inline heating configuration

An improved inline heating configuration combined with a heat pump water heater, proposedby Greyvenstein and Rousseau [7,8], is shown in Fig. 2. In the inline heating configuration, the hotwater produced by both the heat pump and the electrical resistance inline heater is returned to thetop of the storage tank instead of to the bottom. The circulation system includes control valvesthat regulate the flow rate through the heaters in such a way that the temperature of the waterleaving the heater is maintained at the set point. This means that for a fixed heating capacity andoutlet temperature, the flow rate is varied through the valve for varying inlet temperatures. If thereservoir is filled with cold water, the hot water supplied by the heater to the top of the storagetank is always at the regulated temperature. Since the water is added at the top, a well definedtemperature gradient will be maintained. This ensures that even though the average water tem-perature in the storage tank may be much less than the set point value of the thermostat, a certainvolume of water at the top will always be ready for use at the highest temperature, even if most ofthe storage tank is filled with cold water after a peak water demand period. This design philos-ophy, therefore, does not require the water to be heated in a short period due to better utilizationof the available storage capacity. The total amount of water required by the building per day canbe heated gradually over a 20–24 h period, meaning a significant reduction in the installed heatingcapacity required. It is, therefore, clear that this system lends itself much better towards com-mercial DSM.

Previous studies [1] have shown that the application of the inline heating methodology couldreduce the heating capacity required by an average of 58%. If this heating methodology is,however, combined with a heat pump heater, the peak demand could be reduced theoretically by a

Fig. 2. Improved inline heating configuration combined with a heat pump.


further 60%, meaning a combined peak demand reduction of 83%. The heat pump furthermorehas the ability to reduce the electrical energy consumption of the hot water installation by typi-cally 66%, meaning a combined benefit to the building owner of a significant peak demand re-duction, as well as significant savings in the cost of electricity consumption.

3. Web centric monitoring system

Each of the installations in the project is installed with a fully web centric monitoring andcontrol system. This system consists of a logger installed onsite that communicates via radionetworking with the central processing facility (CPF), where the data is stored and displayed. Atotal of 48 channels are measured, including a number of temperatures, flow rates and electricalpower measurements. A typical example of the type of measurements taken is shown in Fig. 3. Allof these measurements are used to obtain all the important parameters to be able to verify thepeak demand reduction and energy saving potential of the installation. The following parametersare needed for validation purposes:

• kVA measurements for the building, heat pump heater and backup electrical heater;• thermal energy output of the heat pump and electrical backup heater and thermal energy avail-

able to the building. The thermal energy is calculated as a function of measured inlet and outlettemperatures, and flow rates for each heater and building consumption;

• dry bulb temperature and relative humidity measurements.

All of the measurements are available on a 30 min basis, and kVA demand measurements areintegrated over this 30 min period, complying with the electrical utility company�s kVA demandmeasurement standard.

Fig. 3. Lay out of measurements taken at an installation.


A further benefit of the monitoring and control system is the ability to send warning messagesvia short message service (SMS) to the cell phone of a relevant person to be able to act on anypossible emergency situation should there, for instance, be a hot water deficiency, or an electricalor safety trip on heating equipment. The system will also be upgraded in the near future to be ableto send signals to the installations for integrated control of the heating systems according topossible time of use energy tariffs to be implemented by ESKOM.

4. Results

Currently, three installations have been completed and monitored. These installations vary interms of occupancy, storage capacity and climatic region and, therefore, results vary slightly, butall three installations have proven to be very successful, with impressive savings and paybackperiods for the building owners, as well as significant peak demand reductions to the benefit ofESKOM. Table 1 shows details for the three installations. Detailed results for one of these in-stallations (case 2) will be displayed and discussed, with a summarization of the results of all threeinstallations given.

4.1. Measured demand side management impact

Fig. 4 shows the measured typical daily peak demand profile of the water heating installation aswell as the total hotel complex before the retrofit. The figure clearly shows the peak demand of thewater heating installation coincides with that of the building complex and, therefore, directlycontributes to the total peak demand costs. At 21:00, when the peak demand is registered, thewater heating installation contributes 130 kVA and the rest of the hotel complex 152 kVA.

The retrofit installation included the replacement of the heaters with a 40 kW heat pump thatwas specifically designed for the inline heating concept. An inline electrical resistance heater with aheating capacity of 54 kW was installed as a backup heater. Fig. 5 shows the measured typicaldaily peak demand profile of the heat pump and the inline electrical resistance heater, as well asthe total hotel complex after the retrofit. The figure shows that around 14:00, when the peakdemand is registered, the rest of the hotel complex, excluding water heating, contributes 143 kVA.This corresponds well with the results obtained before the retrofit. However, the peak demand ofthe water heating installation now does not coincide with that of the overall demand and only

Table 1

Properties of three installation case studies

Maximum

occupancy

Storage capacity

(l)

Installed heating capacity (kW) Typical ambi-

ent condi-

tions (�C)Before After

Case 1 84 5000 54 16 (heat pump),

27 (backup heater)

)4 to 32

Case 2 220 8000 192 40 (heat pump),

54 (backup heater)

)4 to 32

Case 3 242 16,000 168 40 (heat pump),

60 (backup heater)

)1 to 29

0.00

50.00

100.00

150.00

200.00

250.00

300.00

0:00 3:00 6:00 9:00 12:00 15:00 18:00 21:00 0:00

kVA

HotelMain kVA

Hot waterkVA

Fig. 4. Typical diurnal kVA demand before retrofit installation.

0

20

40

60

80

100

120

140

160

180

0:00 3:00 6:00 9:00 12:00 15:00 18:00 21:00 0:00

kVA HP kVA

ILH kVAMain kVA

Fig. 5. Typical diurnal kVA demand after retrofit installation.


contributes 18 kVA instead of 130 kVA. This represents a reduction of 86% in the peak demandcontribution due to the water heating installation. The hot water supply temperature is alsoimproved significantly, with an average supply temperature of 58.5 �C and a minimum supplytemperature of 56 �C.

Table 2 provides a summarization of the peak demand reduction achieved in the three casestudies so far. The values shown represent an average value of all measured data.

Table 2

kVA reductions for three case studies

Measured kVA contribution kVA demand reduction

Before After

Case 1 49 7 42

Case 2 128 18 110

Case 3 104 17 87


4.2. Measured energy consumption reduction

For purposes of comparison, measurements for one full month will be compared for the plantbefore the retrofit and after the retrofit. However, due to time constraints, the measurementsbefore and after the retrofit could not be conducted during the same month of the year forconsecutive years. The results that will be presented for the case before the retrofit were obtainedduring August 2001, while the results after the retrofit were obtained during March 2002.

In order to account for seasonal changes that may influence the heat losses to the outdoor air,the measurements obtained in August 2001, before the retrofit, were adjusted to correspond tooutdoor air temperatures for the month of March 2002. This was done based on heating degreedays obtained from the actual measurements, using the CUSUM method [9]. Furthermore, inorder to account for the difference in actual water consumption during the two measurementperiods, the measured values were further adjusted so that the total useful thermal energy pro-vided to the occupants in the form of hot water was, in both cases, equal to 21,854 kWh.

Fig. 6 shows a comparison of the measured power consumption profiles after adjustmentsduring the course of a typical month before and after the retrofit. From the figure, it is clear thata substantial reduction in energy consumption was obtained.

Table 3 provides a summarization of the kWh savings achieved in the three case studies so far.The values shown represent an average value of all measured data.

0

10

20

30

40

50

60

70

80

90

100

Time during month

kW Before

After

Fig. 6. Comparison between power consumption before and after retrofit.

Table 3

kWh reduction summary for three case studies

Monthly kWh consumption kWh reduction % reduction

Before After

Case 1 11,300 4400 6900 61

Case 2 53,600 15,400 38,200 71

Case 3 28,200 10,200 18,000 64


4.3. Monthly savings for building owner and payback periods

From the previous two sections, it is clear that the improved inline heating configuration,combined with a heat pump, proves to be very effective in terms of both peak demand and energyconsumption reduction. This type of installation is, however, significantly more expensive than aconventional intank installation. Therefore, it is important for a building owner to know exactlywhat his monthly savings will be and how these savings will pay back the initial capital layout ofsuch an installation.

Table 4 shows the typical straight payback period obtained by the building owners, as well asthe internal rate of return (IRR) based on a conservative 10 year maintenance free life cycle.

In the South African commercial sector, straight payback periods of up to 42 months arenormally acceptable, meaning that all three resultant payback periods are much better than theaccepted standard.

4.4. Cost per thermal kWh compared for different types of installations

An interesting way of presenting the cost savings is the comparative cost per thermal kWhconsumed for the hot water system. The standard with which this is determined is as follows:

Table 4

Straight payback period and IRR for three case studies

Straight payback (months) IRR (%)

Case 1 15.7 76.5

Case 2 12.2 98.2

Case 3 24 49.3

0

5

10

15

20

25

30

35

40

45

50

Case 1 Case 2 Case 3

cent

/ kW

h (Z

AR)

BeforeAfter

Fig. 7. Comparative before and after retrofit cost/kWh results.

Table 5

Cost per kWh thermal energy consumed for three case studies

Cost per kWh (ZAR)

Before After

Case 1 36.4 8.2

Case 2 35.4 7.4

Case 3 46.4 10.8


• Determination of the monthly thermal energy consumed by the building as a function of thewater consumption, inlet and outlet temperatures and specific heat capacity value.

• Determining the cost/kWh, by dividing the total monthly cost for the installation by the totalthermal kWh consumed. The total monthly cost consists of both the peak demand costs as wellas the energy consumption cost.

Fig. 7 and Table 5 show comparative before and after retrofit cost per kWh of thermal energyfor all three installations. This represents a cost reduction of 76–80% in operation for the threecase studies.

5. Conclusion

Heat pump water heaters have penetrated only a fraction of the commercial water heatermarket in South Africa. The main reason for this is poor design practice, which leads to pooreconomics and high overhead cost/kW of installed capacity needed. This demonstration projecthowever shows that if integrated correctly with the rest of the installation via the improved inlineheating methodology, the economics of heat pumps are greatly improved. This can significantlyincrease the market for heat pump water heaters in South Africa.

If the methodology, combined with heat pumps, is used to its fullest potential, it can lead to atotal peak demand reduction of 108 MW, which represents 18% of the peak load reduction targetset by ESKOM until the year 2015. This represents an avoided cost of approximately MR324(ZAR) to ESKOM [1]. The benefit to building owners is a significant saving in the monthlyoperational costs of the building, leading to improved economics in the South African commercialsector.

References

[1] Greyvenstein GP, Rousseau PG, Strauss JP. Demand side management in the commercial sector using an improved

in-line heating methodology. Int J Energy Res 1999/2000;25(4):1–25.

[2] Abrams DW. Commercial water heating. Applications handbook. Research Project 3169-01, Final report, Electric

Power Research Institute, December 1992.

[3] ASHRAE handbook. HVAC applications. SI ed., 1999 [Chapter 48].

[4] Meyer JP. A review of domestic hot water consumption in South Africa. R&D J 2000;16:55–61.

[5] Pate RA. A Thermal Energy Storage Tank Model for Solar Heating. PhD thesis, Logan, UT: Utah State University;

1977.


[6] Hendricks GJ. Effects of hot water cylinder design on energy utilization. Report No. GEN154, Energy Research

Institute, University of Cape Town; 1993.

[7] Greyvenstein GP, Rousseau PG. Application of heat pumps in the South African commercial sector. Energy

Environ 1998/1999;15:247–60.

[8] Greyvenstein GP, Rousseau PG. Improving the cost effectiveness of heat pumps for hot water installations. In:

Proceedings of the 5th International Energy Agency Conference on Heat Pumping Technologies, Toronto, Canada,

September 1997.

[9] BRECSU: degree days. Fuel efficiency booklet 7. London: Crown Publishers; 1993.

Documents

Demand side management for commercial buildings using an inline heat pump water heating methodology