Market 2015: Power, Energy, and Ground Source HVAC/R

© copyright Garen N. Ewbank and Ewbank Geo Testing, LLC

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Ground Source Usage and Demand

• Presenters:– Ewbank Geo Testing, LLC• Garen N. Ewbank

– CEM, CRM, CGD, CDSM, CEA, BEP, CSDP– B.S. Industrial Engineering and Management– Member ASHRAE, AEE (life member), IGHSPA, USGBC

• Duane Harman– P.E., CGD, MBA– B.S. Mechanical Engineering– Member ASHRAE, IGSHPA

15 January 2015


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A Short Story About Energy-only two (2) chapters-The Title of the Story is:

“The GHEX and The Third Industrial Revolution (TIR), or, The Second Great

Electrification (SGR)”

15 January 2015

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There are two paths to go by, but in the long run; there is still time to change the road you are on!

• Utility Incentives– Do they really do anyone good; or just

raise the price to the consumer?• Manufacturer Rebates

– Why would a manufacturer extend discounts?

• Contractor Discounts– Is the trade (HVAC/R) that slow?

• Federal Tax Credits– Tax Credits expire at the end of 2016

for our industry!15 January 2015 © copyright Garen N. Ewbank and Ewbank Geo Testing, LLC


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The First Chapter:“The Engineers Explanation” using the Big

Picture

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Parameter Flow of water Flow of heat Flow of current

Quantity Volume- V (m3) Heat- Q (J) Electric charge (C)

Potential Head- ht (m) Temperature- T (K) Voltage (V)

Gradient Hydraulic- ih (unitless) Temperature- it (K/m) Electric field- E (V/m)

Flux Flow rate- Q (m3/s) Heat transfer rate- H (J/s) Current flow (C/s)

Flux density Velocity- ν (m/s) Heat flow- q (J/s.m2) Electrical flux density (C/m2)

Conductivity Hydraulic conductivity- κ (m/s) Thermal conductivity- κ (J/s.K.m)

Electrical conductivity- σ (S/m)

Storage Compressibility Specific heat- ϲ (J/kg.K) Capacitance/Inductance

Decay coefficient Coefficient of consolidation- ϲν (m2/s)

Thermal diffusivity- α (m2/s) Electrical diffusivity- D (m2/s)

Law Darcy Fourier Ohm

Comparing Darcy’s Law (flow of water) with Fourier’s (flow of heat) and Ohm’s (flow of current)

Heat, Q, is a quantity of energy (classical) measured in Joules (N x m), (ft x lb), or BTUs. Power is the rate of usage in kW·hr or MCF (BTUs prior to combustion) per unit time {Citation: Jean-Luis Briaud, Geotechnical Engineering}

615 January 2015 © copyright Garen N. Ewbank and Ewbank Geo Testing, LLC

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What is this 3.23 increase all about?

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Energy in the form of BTUs

65.4%

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Energy in the form of BTUs

60%

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Consider Only the Residential and Commercial Markets

• Quadrillions of BTUs by GHEXs– Together Residentially and Commercially:• How big is this number???? Position as Energy Storage

– Collective Energy Supply by others, i.e., site sourced and stored renewable energy, onsite power generation (fueled), Electric Utility supply• Energy Internet? The Third Industrial Revolution? The

Second Great Electrification?

• Remember the 3.23 to 1 loss?



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Is there zero marginal cost energy or power?

• What is zero marginal cost energy or power?• If supplied by a meter? No• Customer Premises? Yes, but—– Solar PV, Thermal & Wind, but the sun does not

always shine and the wind does not always blow– A ground heat exchanger is ALWAYS ready to

provide storage of BTUs!– The Earth, Water and Ice make fantastic thermal

storage—as in BTUs.

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Residential and commercial combine for a total of 19.99 Quadrillion BTUs of energy usage.

*What are Power and Electric utilities really good at? “Managing Energy” is their core competence.

*What customers really want from Power and Electric utilities is advice on “how to implement energy systems that are more efficient and use less energy”. Energy costs are eclipsing labor costs in some markets.*{Citation: Jeremy Rifkin, The Third Industrial Revolution}


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What would this look like if GSHPs and GHEXs were used to meet all the space conditioning and water heating (SC&DHW) needs in Residential and Commercial Markets?

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Since a GHEX is direct use and a GSHP requires only 20% Electrical Power INPUT from generation or solar PV or wind kW……..

65% of 11.4 = 7.4 x 80% =5.92 supplied by GHEX Leaving 7.4-5.92 = 1.48 Quads by Utility; Plus the 11.4-7.4 = 4, + 1.48 or 5.48 Quads for the Utility (up from the 4.75 originally supplied and without customer fuel switching; a year round customer)

60 % of 8.59 = 5.15 x 80% = 4.12 supplied by GHEX Leaving 5.15-4.12 = 1.03 Quads by Utility; Plus the 8.59-5.15 = 3.44, + 1.03 or 4.47 Quads for the Utility (from the 4.57 originally supplied and without customer fuel switching; a year round customer)

A real opportunity for electric utilities by switching to renewablesto increase customer market share, revenue, and reduce CO2e and particulates emissions

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Since a GHEX is direct use and a GSHP requires on 20% Electrical Power INPUT from generation or solar PV or wind kW……..

A real opportunity for electric utilities--To increase market share, revenue, investment, and reduce CO2e and particulate emissions and this DOES NOT address the reduction in REJECTED energy, FERC 745, EPA “Haze” or clean air, EPA Rule 111 (d)

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Section 111, 42 U.S.C. §7411, of the Clean Air Act requires EPA to develop regulations for categories of sources which cause or significantly contribute to air pollution which may endanger public health or welfare.

Such regulations apply to each new source within a category without regard to source location or existing air quality. Section 111(d) of the Act requires states to develop plans for existing sources of noncriteria pollutants (i.e., a pollutant for which there is no national ambient air quality standard) whenever EPA promulgates a standard for a new source. These are called Section 111(d) plans and are subject to EPA review and approval.

Examples of source categories subject to 111(d) are existing municipal solid waste landfills, municipal waste combustors, sulfuric acid plants, primary aluminum reduction plants, and the phosphate fertilizer manufacturing facilities.

http://www.law.cornell.edu/uscode/html/uscode42/usc_sec_42_00007411----000-.html


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FINAL RULE

ORDER NO. 745

(Issued March 15, 2011)

I. Introduction

1. This Final Rule addresses compensation for demand response in Regional Transmission Organization (RTO) and Independent System Operator (ISO) organized wholesale energy markets, i.e., the day-ahead and real-time energy markets.


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An Act

ENROLLED SENATE BILL NO. 1456By: Griffin of the Senate;And Turner, Echols, Jackson, Newell, Schwartz, Murphey, Brumbaugh, Pittman, Rousselot and Fisher of the House

An Act relating to public utilities;amending 17 O.S. 2011, Section 156, which relates to distributed generation costs; defining terms; modifying prohibition relating to recovery of certain fixedcosts from electric customers utilizing certain distributed generation; prohibiting subsidization of certain costs among customer class; requiring rate tariff adjustment by certain date; and providing an effective date.

SUBJECT: Electrical power distribution requirements


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A real opportunity for electric utilities:To increase market share, revenue, investment, and reduce CO2e and particulate emissions and this DOES NOT address the reduction in REJECTED energy! And guess where the market battle is--renewables are taking utilities market growth ( not share) with site sourced and stored energy (consider in Oklahoma SB 1456)

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So Where has the Proceeding Taken the Market?

Maevelle Energy, Scott Emery, 18th November 2014

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http://geothermal-news.com/2014/11/energy-star-shipment-reports-geoexchange-reality-check-incomplete-data-set/


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The Second Chapter:“Positioning and Marketing for

Ground Source Systems”--ADVOCACY--

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First Cost Barrier

•Currently only those capable to purchase Ground Sourced systems do!•How do we make it “affordable”? Life cycle costing! •How do those with a modest income get a GSHP system? 3rd party financing! Copy solar PV business model!

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First Cost Barrier

• Would you invest in financing the customer?• None of the heat pump manufacturers are

using their federal tax dollars to invest in GHEXs; or their employees 401Ks.

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First Cost Barrier• Just pay for the GHEX if you are capable, and what is the payback?• Incentives (to reduce first cost)

– Utility Incentives• Do they really do anyone good; or just raise the price to the consumer?

– Manufacturer Rebates• Why would a manufacturer extend discounts?

– Contractor Discounts• Is the trade (HVAC/R) that slow?

– Federal Tax Credits• Tax Credits expire at the end of 2016 for our industry!?

• On-Bill financing by Utility• On-Bill payments through Utility• Utility Tariff for the GHEX (AEEOK is ready to help, NESI, others?)• 3rd Party financing for the GHEX (requires sophisticated financiers)

– PACE (FHFA removed their objections (Investor Confidence Project))– Debt– Operating lease– Capital lease– Thermal Services Agreements, PPA– LPs, MLPs, REITs (the GHEX is essential to space conditioning water heating)– Rural Electric Coops using USDA Energy Efficiency and Loan Program

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http://www.eeperformance.org/blog/residential-pace-is-back-fhfa-drops-opposition


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The Plan

• How to differentiate between “capable”, “affordable”, and “best” (should be our playbook—remember IGSHPA Tulsa in 2008?)

• Earth Storage, a GHEX, the best of all batteries and/or storage, BTU to BTU, no kW or MCF conversions

• Turn Neighbor Hoods into GeoHoods using 3rd party financing

• Energy Internet (TIR? SGE?)15 January 2015


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The Plan is to Join theThird Industrial Revolution (TIR) by Participating in the “The

Second Great Electrification (SGE)”1. Get the marketing types, not the accountants, to write

the “GHEX play book within the TIR and SGE” (what is a GHEX worth in 10 yrs?). Discover a Business Model.

2. Demonstrate the idea of turning a neighborhood into a “GeoHood”

3. Use Energy Wise (Energy Wise Partners ) to capture “big data” from the GeoHood

4. Engage a “Google” to explain the GeoHood’s “energy value to an energy internet” from the big data

5. Partner with a sophisticated financier

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http://ewpllc.com/


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DESCRIPTION OF FACILITY:

LOCATION McAlester,OK

SCHEDULE 24 hr w/ offices

USAGE health care

SIZE FT2 57,636

ORIENTATION Facing north


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DX Split w/ Gas Heat Variable Refrigerant Heat Pump Geothermal Heat Pump

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DX Split w/ Gas Heat Variable Refrigerant Heat PumpGeothermal Heat Pump Average Monthly Temperature (F)

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Monthly Total Energy Consumption (kWh), Total Peak (kW) VS Ave Temperature

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AT PEAK BLOCK LOAD, COOLING, DEMAND IN kW

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Where are we headed? It is already unfolding!

• What is the Internet of Things (IoT)?– IoT

• What is the Energy Internet (EI)?– ET

• What is the Logistics Internet (LI)?– LI

• What is the Communications Internet (CI)?– Do you have a “smart phone”? Audio, Video, Text,

Data, Collaboration15 January 2015

https://www.youtube.com/watch?v=Q3ur8wzzhBU

https://www.youtube.com/watch?v=XtQoPcscFts

https://www.youtube.com/watch?v=k_x6drweQuY