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— by Rita Tatum
The end of the 20th century is a good time to take stock of your HVAC system. Will it be
competitive when the century turns on January 1, 2001? You now have less than a year to get
your HVAC system ready for the energy performance and flexibility demands of the 21st century.
“Electricity deregulation and global warming regulations have the potential to change and
shape the future of the HVAC industry,” observes John Suzukida, senior vice president of
marketing and strategy for Trane Worldwide Applied Systems Group. “Today, high efficiency and
flexibility are good investments. Tomorrow, they may become absolutely essential in managing
operating costs.”
“Energy efficiency is the most important environmental issue of our time, and the industry
must make sure its equipment is the most energy efficient possible,” says David Lewis, vice
president of government affairs for Lennox International.
HVAC systems that are more than 20 years old consume a major portion of most energy budgets
today, when the cost per kilowatt hour is relatively cheap. In a deregulated energy market,
where the cost per kilowatt hour is at the whim of the marketplace, older chillers could
break the year’s energy budget in one or two hot summer days.
Unlike regulated price markets, the deregulated energy market is subject to price volatility,
generally referred to as real-time pricing (RTP). RTP means that owners will pay the real
costs for electricity as set by supply and demand.
Demand reduction — along with reduction of kilowatt hours and heat recovery — will be crucial
qualities in the next century’s HVAC systems, according to Bob Panora, general manager of
Tecogen.
“In a deregulated electricity market, there are no guarantees,” observes Doug Rector, senior
product manager, absorption chillers, Carrier Corporation. “It’s going to take several years
before we know what the true costs of electricity are.”
Meeting Total Building Needs
How has the HVAC industry responded to changes in the market? In addition to significant
improvements in overall energy efficiency, the HVAC community has taken a proactive stance to
help facility professionals meet total building needs.
One area in which the HVAC industry has shown initiative is developing and promoting
environmentally responsible refrigerants to replace CFCs. “The trend toward environmentally
responsible refrigerants has driven us for the past several years in the United States,
Europe and Asia — several countries that have taken strong positions on refrigerants,” says
Kelly Romano, vice president of marketing and business development for Carrier Corporation.
In addition to reducing the impact of CFCs on the ozone layer, new non-CFC chillers can be 40
percent more efficient than their CFC counterparts installed 20 years ago.
The U.S. Environmental Protection Agency estimates that when 33 percent of the CFC chillers
are replaced and converted — expected this year — the more efficient chillers will reduce
energy use by 7 billion kilowatt hours per year, saving $480 million annually and avoiding
emissions of 4 million tons of carbon dioxide.
The Montreal Protocol is one of the success stories of the 1990s; now the HVAC industry is at
work developing 21st century sequels. “The industry is working on a precompetitive basis to
meet the needs of the next century,” says Thomas E. Watson, chief engineer for McQuay’s
Chiller Group. “The Air Conditioning and Refrigeration Institute has a 21st Century Research
initiative that is a collaboration of the heating, ventilation, air-conditioning and
refrigeration industry. The 21-CR initiative’s mission is to identify, prioritize and
undertake precompetitive research — where manufacturers work together on research and
development — that focuses on decreasing energy consumption, increasing indoor environmental
quality and safeguarding the environment.” Once a consensus is reached, each manufacturer
takes the information and produces its version of the new development.
New services are also part of the HVAC industry’s response to the new energy
market. “Facility professionals want and need to better understand how their facilities use
energy and how they can manage that use in what could be a volatile deregulated energy
market,” asserts Suzukida of Trane. “It will not be enough to have the most efficient
products on the market. The HVAC industry will need to incorporate energy information
management systems with building automation and control systems and business financial
systems.”
Remote monitoring, supply-side strategies and energy optimization services are already
offered by the industry. Supply-side strategies include offering HVAC equipment under lease
agreements, as well as operations and maintenance packages. HVAC infrastructure outsourcing
is another possibility. HVAC manufacturers sometimes sell directly to energy services
providers or energy services companies that then own the building’s HVAC system. Through a
performance contract, an outsourcing supplier contract or another legal agreement, these
companies sell building comfort back to the facility. They handle the maintenance, energy
charges and operations of the HVAC plant, taking their profits from some or all of the energy
savings achieved. They sell building comfort the way an energy company sells kilowatts or
therms, creating a new form of utility.
Combining Technologies
Myriad solutions are being offered to facility professionals to meet the HVAC needs of the
new century. Some of the more popular include hybrid HVAC plants, thermal storage, gas
cooling technologies and dessicant cooling.
“Basically, there has been no major change in the design of HVAC systems in response to
deregulation, primarily because electric chillers already are very efficient as compared to
20 years ago,” says Gearoid Foley, sales and marketing manager for Broad USA Inc. “But there
has been a great change in emphasis. For example, we are seeing strong, increased interest in
gas chilling as a response to peak energy pricing.
“Another improvement is the integration of controls with HVAC components to increase
efficiency,” adds Foley.
Hybrid HVAC plants are “a safe middle zone that more facility professionals are choosing,
because they minimizes risks,” says Carrier’s Rector.
Hybrid chiller plants, which can be switched from electricity to natural gas, help facility
professionals level load profiles, allowing them to use the most economical source of power.
Already, a number of major energy users, including hospitals, colleges, universities and
government buildings, are discovering they can reduce air-conditioning costs by operating
hybrid chiller systems that combine gas and electric units.
Hybrid chiller plants enable facility professionals to take full advantage of fluctuating
utility rates. A facility professional with the ability to choose between gas or electric
cooling on a daily basis will have negotiating power in a deregulated environment. Gas
cooling owners are attractive to gas companies because they use gas in the summer. Gas
cooling customers are also attractive to electric companies because their load profile is
flat. Flexibility in fuel sources gives a facility professional control and negotiating power
in a deregulated environment.
In addition to hybrid plants, there are hybrid chillers that integrate a gas engine and an
electric motor with a single compressor. At any time, either the engine or the motor drives
the compressor. The advantage to this system is that it allows customers who need just one
chiller or who have limited room for equipment the ability to benefit from hybrid plant
technology. Like the larger hybrid plants, the unit provides full redundancy. It can operate
on gas while the motor is down for maintenance and vice versa.
“The hybrid chiller plant offers both the flexibility and efficiency necessary for the
changes in the energy markets,” says Brian S. Smith, product manager for York
International. “In many cases, hybrid chiller plants will become the norm due to their
flexibility. Fluctuating energy prices will provide the financial justification necessary for
non-electric chillers.
“During hot summer days, electricity is very expensive, giving non-electric chillers a
financial advantage over electric chillers,” Smith explains. “Conversely, off-peak electric
prices will be more economical than gas or steam since demand is down; therefore, a balance
of fuel is necessary to take advantage of the lowest energy pricing throughout the year. The
optimum configuration will vary from one site to the next, however, the need to have a
combination of chiller types will be critical.”
Thermal Energy Storage (TES) has proven itself financially by saving facility professionals
money through the shifting of electricity use to nighttime when costs are lower. TES also can
be good for the environment. In fact, when TES is incorporated directly into the building
design, energy use at the site can actually be reduced, according to the Air Conditioning and
Refrigeration Institute (ARI).
With a TES system, the chiller runs at night, storing the cooling in ice, cold water or
another material, such as a blend of chemicals. When the building needs cooling, the stored
cooling is tapped. The cooling can be used alone to match the air-conditioning load, allowing
the chiller to remain off during the day. Or it can be used to supplement the chiller, which
now has to match just part of the load.
Electricity use during the day is reduced and replaced with nighttime electricity. In
addition, air-cooled equipment can take advantage of lower nighttime ambient temperatures to
get a boost in efficiency. Because water from the storage tanks may be colder than
conventional chilled water, smaller pipes, pumps and air handlers may be integrated into the
building design to save even more energy.
Thousands of TES systems have been operating successfully for years in hospitals, public and
private schools, universities, airports, churches, government facilities, private office
buildings and industrial process cooling.
Gas chillers now command nearly 9 percent of the chiller market, up from 4 percent in 1990,
according to data from the Gas Research Institute’s (GRI) Commercial Gas Cooling Program. In
the past decade, annual sales of gas absorption chillers have tripled, from 50,000 to 150,000
tons per year. Sales of gas-engine-driven chillers have leaped from 5,000 tons per year in
1994-95 to an estimated 60,000 tons this year.
“The stage is set for a major change in the market and in the use of gas to generate power
and satisfy thermal needs,” says Edward Reid, American Gas Cooling Center executive director.
Natural gas cooling technologies are not new. But because of the high initial costs of
equipment, cooling with natural gas took a long time to penetrate the commercial cooling
market. The deregulation of the energy industry and a drop in the cost of natural gas for
commercial consumers is making natural gas an economically viable alternative to conventional
electric-driven cooling systems.
Those facility professionals finding gas cooling particularly attractive often are in areas
with high electric rates. Another growing market is facilities with long operating hours that
can accept longer paybacks, such as hospitals, hotels, colleges and universities, and
government buildings.
Desiccant system dehumidification and cooling is another option more facility professionals
are considering. A desiccant is a substance that removes moisture from the air by attracting
water vapor to its surface through vapor pressure differences.
“Most people are familiar with a desiccant in the form of the little silica gel packets often
inserted in vitamin bottles or camera cartons,” explains Thomas J. Clemens, chairman of
ARI’s Desiccant Cooling and Dehumidification Equipment Section. “Commercial desiccant
systems work along the same lines but with a much larger capacity to remove moisture and a
means to regenerate the desiccant. When moisture is removed, the air is both dried and warmed
by the adiabatic conversion of latent to sensible energy from the moisture and can then be
cooled using one or more options, such as recovering energy from exhaust air, indirect
evaporated cooling or mechanical cooling.”
Rita Tatum is a freelance writer in Osceola, Indiana.
Codes and Standards
Among new regulatory and code developments, three strongly impact HVAC options in the
millennium: the American Society of Heating, Refrigerating and Air-Conditioning Engineers
(ASHRAE) Standards 90.1-1999, ASHRAE 62-1999 and ASHRAE Guideline 13P.
The U.S. Department of Energy (DOE) is encouraging the International Code Council (ICC) to
update a reference in its International Energy Conservation Code to include ASHRAE/IESNA
(Illuminating Engineering Society of North America) Standard 90.1-1999, “Energy Standard for
Buildings Except Low-Rise Residential Buildings.”
ASHRAE/IESNA Standard 90.1-1999, which is currently being appealed, is expected to reduce
site energy cost in retail and office buildings by 16 percent, according to a preliminary DOE
study. The new standard should produce source energy savings of 20 percent as compared to the
1989 version.
“Based on preliminary findings, it appears Standard 90.1-1999 should save energy consumers a
significant amount of energy,” said Mark Ginsberg, DOE deputy assistant secretary in a letter
to ICC. “People will be able to save energy, while helping the environment.”
Public review of a proposed addendum to ASHRAE Standard 62-1999, “Ventilation for Acceptable
Indoor Air Quality,” and proposed ASHRAE Guideline 13P, “Specifying Direct Digital Control
Systems,” occurred at the end of 1999.
The ASHRAE Standard 62-1999b addendum would limit the standard to new buildings and to
additions and changes to existing buildings specifically identified in the standard.
“This change is being proposed because many of the requirements in the standard were
developed primarily with new buildings in mind,” explains Andy Persily, chairman of ASHRAE
SSPC 62.1. “In some cases, it may be difficult, excessively expensive and unnecessary to
modify an existing building or HVAC system to meet these requirements. On the other hand, the
standard may contain requirements developed with existing buildings in mind, and these will
be specifically called out in the standard.”
Because Standard 62-1999 is updated constantly through ASHRAE’s continuous maintenance
procedure, not limiting the scope to new buildings may suggest existing buildings also must
be upgraded each time the standard is revised, Persily says.
Proposed ASHRAE Guideline 13P would help facility professionals develop specifications for
direct digital control systems in HVAC control applications. It outlines criteria for
hardware, performance, installation and training, and addresses system architecture,
input/output structures, communications, program configuration, system testing and
documentation.
Who’s Selling Facility Management?
What does the future promise for facility professionals, particularly when it comes to HVAC
and other energy issues? New services from energy service companies that may encompass more
than simply running the HVAC plants in buildings. In fact, a growing number of companies,
including some HVAC manufacturers, are now offering facility management to those interested
in outsourcing the total process.
According to research by Frost & Sullivan, energy management services generated revenue of
$23.3 billion in the United States and Canada in 1998. These revenues represent all behind-
the-meter energy services, including performance contracting, energy audits, equipment sales
for energy management purposes and project management. The participants in this revenue —
which is projected to reach $43 billion by 2005 — are primarily energy service companies,
energy service providers, contractors, facility management companies and the electric utility
industry.
According to Frost & Sullivan, both utility-affiliated and independent energy service
companies are creating divisions to provide total facility management solutions. As energy
service companies become major competitors in the facility management industry and facility
management providers expand more heavily into energy management solutions, the industry
crossover has the potential to reshape the energy management industry.
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