HVAC industry's opportunity in net-zero energy market is growing
Opportunities are growing for the HVAC industry to pursue role as energy services provider in net-zero energy building market.
With a rising deluge of buzzwords and phrases ranging from sustainability and climate change to energy efficiency and green building seeping into nearly all industries, it’s hard to ignore HVAC’s role in lessening the environmental impact of buildings in the United States and worldwide. Highly efficient equipment such as heat pumps from HVAC manufacturers like Daikin, Mitsubishi Electric and Bosch, for example, and radiant heating and cooling paired with dedicated outdoor air systems are enabling buildings to increase overall system efficiency and reduce energy consumption.
As sources of fossil fuels become more limited, organizations focused on sustainable built environments such as ASHRAE say a focus on energy-efficient equipment and renewable energy sources — solar, wind power and geothermal, for example — will become more important.
Last year alone, buildings in the commercial and residential sectors accounted for roughly 40 percent of the nation’s total energy consumption and 71 percent of the electrical energy consumption.
“The result is an energy impact that is increasing faster than energy conservation measures,” said Bjarne Olesen, ASHRAE’s 2017-18 president.
But somewhere in the mix of all those buzzwords lies another green term that has gradually evolved from science fiction to reality: net-zero energy buildings. As cost-efficiency and health benefits such as indoor air quality become a greater priority, Olesen said, net-zero energy buildings and sustainable design are increasingly becoming standard practices, and high-efficiency HVAC systems have a significant role in zero or low energy building projects for both residential and commercial built environments now more than ever.
It starts with a definition
Simply put, a net-zero energy building produces as much energy over the course of a year as it consumes. But the term itself opens a sort of entangled can of word variations, depending on whom you ask.
To alleviate any confusion, the U.S. Department of Energy released a common identifier in 2015 for a zero energy or net-zero energy building, defining it as “an energy-efficient building where, on a source energy basis, the actual annual delivered energy is less than or equal to the on-site renewable exported energy.”
But ASHRAE’s Olesen said an argument could be made against that definition.
“The DOE’s definition includes renewable energy produced off-site at power plants utilizing hydropower, or wind or solar farms,” he explained. “In that instance, if the power plant produces the power solely from renewables, then even a building that is not very efficient could qualify as (a net-zero energy building).”
ASHRAE, in turn, relies on a definition that acknowledges the conflict by only considering the renewable energy produced on-site, arguing that it will guarantee the quality of the building.
Brendan Owens, chief of engineering at the U.S. Green Building Council in Washington, D.C., suggested that sometimes those involved might get too focused on tangible or specific definitions.
“A lot of those definitions sort of hinge on what you consider to be the building’s site, (meaning) whether or not you allow people to take credit for on-site renewable energies or off-site renewable energies,” Owens said. “If you are aspiring to build a net-zero building and you only get 90 percent there, you’ve still accomplished something that is extraordinarily laudable.”
In anticipation of an expanding net-zero energy building market, the Green Business Certification Inc. created Arc, a digital platform that allows building owners and operators to benchmark, track and compare energy, water, waste, transportation and human experience using a performance score. Arc can track net-zero carbon emissions associated with energy and transportation, and connect data to green building strategies associated with LEED (Leadership in Energy and Environmental Design), among other features. The goal of Arc is to support the missions of GBCI and USGBC.
“Our focus is really on the entire energy system and encouraging project teams to really think about these things certainly not as a zero-sum game, but as an issue that needs to be managed in both a proactive way in the things that you can control, and a proactive way in understanding … whether or not your building is a good neighbor on the grid,” Owens said.
To net zero and beyond
In 2015, the Net-Zero Energy Coalition, a group comprised of nonprofits, cities, product manufacturers, developers, builders and design professionals working to reach zero carbon goals by 2050, tracked 408 zero energy projects, comprising 3,339 buildings and a combined total of 6,177 single- and multifamily units across the United States and Canada.
The following year, the coalition found zero energy projects in those two countries had increased nearly 82 percent to 741; the number of zero energy buildings had increased 22 percent to 4,077; and the number of single- and multifamily units of zero energy housing had increased nearly 33 percent to 8,203, according to a 2016 study of residential buildings.
“If you think back even 10 years ago, there were questions as to whether net-zero or zero energy buildings were even possible,” said Ralph DiNola, CEO of the New Buildings Institute, a Portland, Oregon-based nonprofit working to improve the energy performance of commercial buildings. “I think with the convergence of energy efficiency and lower and lower costs of renewable energy systems, mainly photovoltaic, that it’s become ever more possible to achieve zero energy in a lot of buildings and building types.”
Across North America, the institute has tracked a total of 309 zero energy-emerging commercial buildings, where the teams have made a commitment to get to zero, but haven’t quite achieved it yet, and 58 zero energy-verified commercial buildings.
While states like New York, Rhode Island and Vermont have adopted climate- and energy-focused policy goals, California has set one of the country’s boldest agendas with the goal of having 100 percent of all new residential homes achieving net-zero energy by 2020, and the state is encouraging builders, homeowners and HVAC contractors to further drive market demand for highly efficient homes.
Providing add-on energy services
In response to California’s energy action plan, HVAC contractors in the state have begun installing solar electric for customers as an add-on service, according to David Knight, part owner of Carmel, California-based Monterey Energy Group. Since 2009, Knight estimated the company has worked on roughly 100 net-zero energy projects a year.
“Almost every house we work on these days has a solar electric component, and the reason is simple: (In California), it’s cheaper to produce energy with solar than to buy it from the grid,” he said, adding that solar can compete well in any market where the price of electricity ranges between 10-15 cents or higher.
In the modern, energy-efficient homes Monterey Energy Group works on for the state’s tech and entertainment industry executives, Knight said builders and architects are no longer leaving space in homes for ductwork.
“Ductwork takes up a lot of space, and space is expensive,” he explained. “Anything that the HVAC industry does to understand that systems need to get thinner and just take up much, much less space is critical. And contractors need to understand that those trends, they’re not going away.”
The company also specializes in air-source heat pumps, solar electric systems, hydronic floor heating, heat recovery ventilation, and radiant heating and cooling, which many California design teams have turned to as part of designs that can cut energy use in half, according to a recent case study from the New Buildings Institute.
The study, which references data from organizations such as ASHRAE and the University of California’s Center for the Built Environment, among others, explains how combining radiant space heating with a dedicated outdoor air system can significantly reduce the amount of HVAC energy often by 50 percent when compared with a similar commercial building using a standard forced air system.
The six-story, 50,000-square-foot Bullitt Center office building in Seattle, for example, uses a heat recovery ventilator as part of its dedicated outdoor air system, water-to-water heat pumps from FHP Manufacturing and an Uponor PEX (crosslinked polyethylene) radiant floor heating system. The center’s heating and cooling is just 5 percent of the building load, and ventilation is 7 percent, according to the case study.
“One of the things we’re seeing more of is a move toward decoupling the ventilation system from the conditioning system, and so we see that with radiant heating and cooling, and we see that with dedicated outdoor air systems, where (they are) providing the conditioned ventilation air,” said NBI’s DiNola, adding that variable refrigerant flow systems are also an emerging trend in a number of buildings.
HVAC plays its part
Standards developers and advocacy associations, such as the Air-Conditioning, Heating and Refrigeration Institute, are also leading the charge for reductions in the nation’s energy consumption by backing policies that “encourage clean, reliable energy sources that provide the power necessary for AHRI members’ equipment to operate efficiently as intended, with minimum carbon dioxide contribution to the atmosphere,” and at an affordable cost to consumers, the association states.
AHRI has also been supportive of the 1975 Energy Policy and Conservation Act, which established federal energy conservation standards for consumer products, but is working with Congress on some “common sense” reforms to reflect current technologies and economic realities.
“The innovation that our industry is known for and that it is committed to is very evident in the wide range of efficiency levels that are available to folks — from way, way up high down to the federal minimum,” said Francis Dietz, vice president of public affairs at AHRI.
ASHRAE is also leading the charge for better efficiency with its Vision 2020 initiative, which aims to provide tools within three years that will help the building industry to produce market-viable net-zero energy buildings by 2030. The society’s updated standards 90.1 and 189.1 — “Energy Efficiency Standard Buildings Except Low-Rise Residential Buildings” and the “Standard for the Design of High-Performance Buildings,” respectively — is producing more energy-efficient buildings. If applied nationwide, Standard 90.1 could produce up to a 34 percent decrease in energy use in new buildings, Olesen said.
The society is also working on the newest addition to its Advanced Energy Design Guides, which Olesen said enable a 30 percent energy savings and a 50 percent energy savings over 90.1.
“The new series will be the final step in the AEDG series to help engineers, architects and contractors achieve a (net-zero energy building),” he added.
HVAC equipment manufacturers like Johnson Controls are also taking note of a growing trend toward higher energy efficiency and net-zero energy building, as evidenced by its 2016 Energy Efficiency Indicator Survey, which found that 72 percent of facility and energy management executives in the United States, Brazil, China, Germany and India anticipate increased investments in energy efficiency and renewable energy over the next 12 months. Eighty percent of those surveyed also plan to achieve nearly zero, net-zero or positive energy status for at least one of their facilities compared to 49 percent in 2013.
“HVAC (and refrigeration) systems are a critical element in net-zero energy buildings,” said Clay Nesler, vice president of global energy and sustainability at Johnson Controls. “Every way that lighting, HVACR and plug-loads save is a watt that doesn’t need to be generated by renewable energy or sourced from the grid.”
Being a part of the net-zero energy movement just “makes good economic sense,” Nesler added, citing a report by Navigant Research that expects the net-zero energy building industry to skyrocket with an annual increase of 38 percent through 2035, pushing its value to $127 billion.
Johnson Controls is already using low-energy designs at its corporate campuses in Shanghai and Glendale, Wisconsin. The Glendale campus uses York heat pumps connected to a geothermal energy field with 272 individual 250-foot-deep wells to eliminate almost all natural gas use for water heating, while also improving the efficiency of the air conditioning process, Nesler said.
“The HVAC industry needs to become more systems-oriented, combining integrated building design with efficient equipment and optimizing controls,” he said. “The design of buildings (that) use distributed generation, energy storage and demand response to reduce energy demand and costs through communication with the smart grid is a big opportunity.”
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