Time Dependent Valuation (TDV) for Energy Standards

1. Time Dependent Valuation (TDV)for Energy Standards Statewide Codes & Standards ProgramPrepared for CEC Workshop April 2, 2002Presentation by PG&E/HMG/E3/Eley/BSG

2. TDV Project History • 1998-99 CEC/PG&E Study: “Dollar-Based Performance Standards” • 1999-2001 PG&E/SCE/SoCalGas further development of Time Dependent Valuation • TDV Cookbook - economics methodology • Engineering model enhancement • Demonstrations of compliance outcomes • Complete & present proposal to CEC

3. TDV Project Team • CEC staff - advise and comment • PG&E - development lead • SCE & SoCalGas - support, review, advise • Consultant team - lead by HMG • Economics: E3 • Engineering: Eley, BSG • Other stakeholders consulted: CBIA, NRDC, public workshop

4. TDV Issues Map

5. TDV Goals - Statewide • Bldg population with lower peak demands • Lower peak costs for electricity system • Insurance against future blackouts • Long-term demand reduction • Cheapest to do with new construction (rather than retrofit)

6. TDV Goals - Compliance • Replace “flat rate” energy basis • Transparent to compliance end-user • Credit for measures that perform on-peak, less for off-peak measures • Better signals to designers • Method tied to CEC weather tapes and ACM performance calcs

7. TDV Policy Choices • Change savings valuation in Title 24 • Abandon source energy flat valuation • Replace with time dependent valuation • Change source energy • Abandon electricity source energy (mult = 3) • Replace with TDV energy (hourly factors) based on CEC forecasts of costs • Distinguish between natural gas & propane

8. TDV Policy Choices (continued) • Adopt economic valuation methodology • Publicly available (mostly CEC) data sources • Repeatable over time • Easily adjusted as forecasts change…but not expected to update frequently • Adopt engineering analysis upgrades • Hourly HVAC equipment models • Hourly analysis of measures • Others...

9. TDV Policy Choices (continued) • Uses of TDV • For optional performance trade-offs • For new compliance options • For demonstrating cost-effectiveness of new standards requirements

10. TDV Policy Choices (continued) • Methodology Choices (our recommendations) • Use 1992 Standards valuations? (no) • Use current CEC forecast? (yes) • Use temp-dependent allocation of T&D? (yes) • True up to overall revenue requirements? (yes) • Use environmental externalities? (yes)

11. Why Not Use Rates? • There are many different rates (which?) • Rates average the high cost periods and dilute the price signal • Rates change with policy/political choices • TDV reflects long-term system costs • CEC 30 year generation forecast • Utility T&D cost experience • Overall revenues to run utility system

12. How TDV Works (electricity) Time Dependent Energy Value With TDV value a kW saved during a high-cost peak hour is valued more highly than a kW saved during an off-peak hour Flat Energy Value With flat energy value a kW saved is valued the same for every hour of the day Energy value Friday Monday

13. Building up the Electric TDVs Hot afternoon Environment T&D PX CASE Initiative Project Copyrighted © 2000 PG&E All Rights Reserved 1. Start with the CEC Forecast Commodity Costs 2. Add the marginal T&D delivery costs as f(temp) 3. Adjust to bring to revenue requirement (rate levels) 4. Add environmental externality of reduced pollution (optional) 5. Convert to equivalent energy units (TDV energy units) Forecast Costs TDV Energy Value Revenue Neutrality Adjustment Monday Tuesday Wednesday Thursday Friday

14. Building up Gas and Propane TDVs Commodity Cost Environmental Externality CASE Initiative Project Copyrighted © 2000 PG&E All Rights Reserved 1. Start with the CEC Forecast Gas Commodity Costs 2. Adjust to bring to revenue requirements (rate levels) 3. Add environmental externality of reduced pollution (optional) 4. Convert to equivalent energy units (TDV energy units) Forecast Costs Energy Value Revenue Neutrality Adjustment December January

15. Components of TDV for CTZ 13

16. Sources of TDV Economics Data

17. How Does TDV Compliance Work? • Used for performance trade-offs(instead of old source energy trade-offs) • Compliance runs done per usual • Compliance software enhanced to do hourly base/proposed calculations • TDV value for each hour multiplied by hourly energy, totaled for annual savings • Same compliance report printed out

18. Changes to Title 24 for TDV • Delete definition of SOURCE ENERGY • Add definition of TDV ENERGY • Adjust ACM rules for engineering enhancements • Adjust rules for propane & natural gas • Adjust ACM output reports

19. Questions and Commentson TDV Economics

20. TDV Engineering Enhancements • Goal: Credit air conditioning systems that perform better on-peak • Hourly equipment model for residential • Improved performance curves for nonres • Goal: Improved treatment of water heating • Hourly hot water usage profiles • More complete distribution options • Goal: Credit other measures that perform better on-peak (e.g. cool roofs, daylighting)

21. Residential TDV Modeling • Air Conditioners • Heat Pumps • Duct Systems in Attics Engineering ACM Enhancement to better implement TDV

22. Residential Air Conditioners • Historical perspective Sensible loads SEER as Seasonal Efficiency • 2001 Standards changed Conservative EER/SEER assumption Temperature and installation adjusted SEER as seasonal efficiency

23. 2001 EER/SEER assumption

24. 2001 Temperature adjusted SEER

25. TDV Air Conditioner Model • NAECA SEER primary input • 2001 EER/SEER assumed at 95 degF • Efficiency above 95F based on PG&E tests • Optional EER input • Constant 62 WB indoors

26. TDV AC Efficiency vs. Outdoor Temp

27. TDV Indoor Air Handler Fan • Adjust SEER and EER to remove fan Fan is defaulted not tested 365 w/1000 CFM assumed 510 W/1000 CFM actual (Proctor) • Model fan power separately Assume 300 CFM/ton, 510 W/1000 CFM Allow inputs for field verified CFM and W

28. TDV Heat Pump Model • HSPF is primary input Default COP at 47F = 0.4 x HSPF • Capacity at 47F Default to Rated Cooling Capacity • DOE2 hourly model

29. TDV Default Heat Pump COP47

30. TDV Hourly Duct Efficiency • For ducts in attics • Adjusts ACM Seasonal Efficiency on an hourly basis for heating and cooling • Roof Sol Air Temperature driven • Includes effects of all current options • Invisible to ACM user

31. Residential Water Heating Engineering ACM Enhancement to better implement TDV

32. Load Dependent Energy Factor (LDEF) – Annual Method

33. Load Dependent Energy Factor (LDEF) – Hourly Method

34. Load Dependent Energy Factor (LDEF) Coefficients

35. Distribution System Multipliers(Being Revised)

36. Hourly Loads • Make consistent with current method

37. Loads from Multifamily Study

38. Example Loads from EPRI/LBNL Study

39. Redefining Nonresidential Equipment Performance Curves Engineering ACM Enhancement to better implement TDV

40. Nonres Performance Background • Use ACM software for whole-building trade-offs • Requires two energy simulations • proposed design • budget building. • The rules tightly defined by the ACM manual. • The default curves were developed in the 1970s; some were updated with the 1993 supplement. • Propose changes to the ACM manual: • allow users to input data for particular HVAC equipment • update of the default curves to reflect performance of modern equipment.

41. The Five DOE-2 Curves wet, dry bulb temperature COOL-CAP-FT cooling capacity wet, dry bulb temperature cooling energy input ratio COOL-EIR-FT COOL-EIR-PLR part load ratio energy input ratio dry bulb temperature HEAT-CAP-FT heating capacity dry bulb temperature HEAT-EIR-FT heating EIR

42. Our Initial Approach • Investigated the technologies for 150 different rooftop package units from several manufacturers • Tried to draw conclusions between the technologies and performance. • No statistically robust methods of predicting an actual performance curve based on the data available.

43. Current Approach: Three Sets of Curves • The current DOE default curve (from ACM) • Best-fit curves • The most accurate representation of the data set for each particular equation determined with least-squares regression • Found divergences between the current defaults and actual performance • P15 curves • Lowest performing 15% of the data set.. • In general, equipment that performed poorly did so at all temperatures. • Performed a least-squares regression on the worst performing subset to create the P15 curves.

44. Recommended Changes to ACM User Options: 1) Input the performance data of their particular equipment directly into the compliance software. Best captures the details of the unit’s performance 2) Do not input data - revert to the P15 performance curves. Because these units represent the worst performers in the population, the user is motivated to use equipment with better performance and input it into the model. The reference building will use the best-fit performance curves for each piece of equipment.

45. COOL-CAP-FT - dependent on outside drybulb and entering wetbulb temperatures

46. … but to aid discussion, we reduce it to two dimensions as shown below. COOL-CAP-FT Current Defaults 1.1 EWB = 72 1 EWB = 67 0.9 Normalized capacity EWB = 62 0.8 0.7 0.6 85 95 105 115 125 Dry bulb temperature

47. As expected, P15 Curves diverge from the current defaults and best-fit at higher temperatures. COOL-CAP-FT Comparison of Curves EWB = 72 1.1 EWB = 67 1 Current Default EWB = 62 Best Fit 0.9 P15 Normalized capacity 0.8 0.7 0.6 85 95 105 115 125 Dry bulb temperature

48. COOL-EIR-FT - normalized cooling efficiency as a function of dry and wet bulb temperatures. worse better

49. Actual equipment performance is much worse than the current DOE2 defaults at high temperatures. P15 worse best fit current defaults better

50. HEAT-CAP-FT - normalized heating capacity as a function of outside dry bulb temperature HEAT-CAP-FT Curve Comparison 1.2 1 0.8 Normalized capacity 0.6 0.4 17 27 37 47 57 Dry bulb temperature Current Defaults Best Fit P15 There is little divergence in the data for this curve.