Abstract
This chapter looks at a systematic approach to determine energy conservation project cost effectiveness. It discusses various types of analysis methodologies. And in the analysis process of multiple conservation measures (ECMs), look for any relationships between the various ECMs. This chapter then discusses how to preform a reduction analysis process on multiple ECMs to develop an optimized investment plan.
The last part of this chapter focuses on using life-cycle cost analysis (LCCA) to develop energy and cost savings data as they relate to converting high- pressure sodium (HPS) roadway and facility exterior lighting systems to an more energy efficient light-emitting diode (LED) technologies. The LCCA example looks at the costs and energy usage over twenty years from both the base case (normal business or the “do nothing” scenario versus conversion of all California State maintained roadway and maintenance facilities).
All statements and data contained in this chapter are based upon 40+ years of developing conservation training and successful implementation of various conservation projects and programs, in the private sector (Honeywell Inc., private consulting) and with the State of California (California Energy Commission, CalParks, and the Caltrans).
Steve C. Prey, retired in 2012 as Statewide Energy Conservation Program Coordinator for the State of California Department of Transportation (Caltrans) since 1983, Chair “Emeritus” member of the California State Government Energy Policy Advisory Committee, technical advisor to the Sandia National Labs Special Projects Portable Hydrogen Generation Product team, and member of the National Academies of Science, Transportation Research Board Special Task Force on Energy and Climate Change. Prey can be reached at: steveprey@earthlink.net
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Notes
- 1.
For data updates on this project, please contact Gonzalo Gomez who is the LED roadway lighting project manager, as of July 1, 2012: gonzalo_gomez@dot.ca.gov.
- 2.
(Note: Economic value, for the energy used, is always done at the end of the analysis process. Since the amount of energy used is true given the same set of data, the value will vary by energy supply source (utility, gen set, or renewable source) at the time the economic analysis is performed. Also, over time (say 2001 vs. 2012) while the amount of energy remains the same, the energy value will change.)
- 3.
(Note: Flat rate accounts with lighting controls being added would have to be converted to a metered account due to the change in operations. Typically, the conversion from flat rate to metered account costs is covered by the servicing utility. In California, most utilities are installing “smart meters” on accounts in order to optimize power delivery within the state’s various service territories. In the case of this example, all maintenance service yards have metered accounts.)
- 4.
(Note: An SPA value for a project could be generated as an end product from a more complicated analysis process. This is an option for simplifying info and at the same time the more in-depth data is available upon request. A demonstration of this last point is found at the end of the chapter.)
- 5.
(Note: All state and local government transportation departments must use the FA/VE analysis for federally funded roadway projects valued at over $25 million in federal matching funds. So, most transportation departments are familiar with this analysis process and have access to trained staff within each state’s transportation network. The Industrial Engineering/Operations Research (IEOR) community typically uses the SA process.)
- 6.
(Note: The State of California Department of General Services has posted its “Department of Finance” approved LCCA model which California State departments can use to define the viability of energy conservation projects. The web address to the site is http://www.green.ca.gov/LCCA/default.htm).
- 7.
For more details the Wikipedia online site has some general information: http://en.wikipedia.org/wiki/Life-cycle_assessment.
- 8.
(Note: Environmental pollution, like dust or bird-scat, has been known to cause lights to stay on during the day so most transportation departments have maintenance programs that try to correct the situation within a few days if not sooner. A further note: within the last few years, a national dialog has looked at increasing the intelligence of the roadway lighting controls. The end product is a standardized universal plug socket in new approved roadway lighting fixtures. Into that socket, a simple photocell or time clock could be attached or higher level controls including devices that monitor the condition of the lamp and ballast. Should the fixture monitor note changes in the fixture’s operation, the device signals a central control center (via power line carrier signal, WiFi, or cell phone signal) of the condition of the fixture. The control center would then route maintenance crews to service the fixture. This system eliminates nightly driving routes by crews looking for burned out lights, thus reducing fuel and staff maintenance resource costs.)
- 9.
(Note: A copy of the energy analysis package can also be used to track the implemented project(s) performance over time adjustments to utility costs and other rates and other variables. The power of the spreadsheet would then automatically adjust future year forecasted numbers along with any running total calculations included in the model.)
- 10.
(Note: Process equipment projects may be placed before HVAC projects depending upon the scale of the process-related loads versus HVAC.)
- 11.
(Note: When developing the LCCA analysis model over time, the use of these adjustment factors can be used to determine forecasted cash flow, net present value of money, and sensitivity analysis factors that would look at what future conditions may impact the proposed project cash flow. By assuming that both base case and project options use the same factors, then changing the variations for all yields a consistent comparison under any scenario.)
- 12.
Note: One way to reduce the additions/inserting of rows of data from base case to alternative X variation Z plans is to include every row of data and calculations into the base case model (zeros are okay). Then the copy and paste process only needs to focus on the differences between the various analysis engines in the final workbook file set.
- 13.
For copies of the most current speci fi cations and quali fi ed products list, please contact gonzalo_gomez@dot.ca.gov.
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© 2013 Springer Science+Business Media New York
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Prey, S.C. (2013). Energy Conservation for Optimum Economic Analysis. In: Clark II, W. (eds) The Next Economics. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-4972-0_10
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