HVACR industry representatives, government officials, and energy aficionados convened in Washington, D.C., to discuss the role renewable energy resources can play in the U.S. building sector during Danfoss’ 17th annual EnVisioneering Symposium.

Participants engaged in an energy roundtable discussion, addressing opportunities and obstacles pertaining to HVAC manufacturers, contractors, and consulting engineers.

“It’s clear that we have a long road ahead before renewable sources have broad market adoption and deployment — before they become mainstream. It will take the right development of technology, economics, and policy,” said Robert Wilkins, president, Danfoss North America.

Congressional Participation

Rep. Charles Bass, R-N.H., opened the event through a presentation during an evening reception. Bass focused largely on H.R. 4017, the Smart Energy Act, which he introduced in February. Bass claimed the measure could save taxpayer money through energy-efficiency innovations specifically focused on reducing the federal government’s energy usage.

“The federal government spends $7 billion annually to heat, cool, and operate its 445,000 buildings. Given our nation’s fiscal constraints, a common-sense place to save taxpayer dollars is by improving the energy efficiency of the hundreds of thousands of federal buildings across the country,” said Bass. “Through the use of new technologies and innovative funding mechanisms to help make the improvements, these upgrades can begin today at a price taxpayers and our nation can afford, while also helping to spur even more advancements in energy efficiency technologies for buildings, vehicles, and other electronic devices and appliances outside of our government.”

Rep. Peter Welch, D-Vt., opened the following day’s symposium by discussing H.R. 4230, the Home Owner Managing Energy Savings (HOMES) Act, which he, along with Rep. David McKinley, R-W.Va., introduced in March.

The bill would reward homeowners for reduced energy consumption as the result of a qualified home energy-efficiency retrofit. The legislation, if approved, would provide rebates based on estimated savings as determined by an energy audit, starting at $2,000 for homeowners who can demonstrate 20 percent savings and increasing incrementally up to $8,000 or 50 percent of the project’s cost, whichever is less.

“We need to be ambitious about our energy use. Renewable energies help us toward energy independence,” said Welch. “Less use of energy is more and the more value we can get out of our energy, the better. We can’t just turn the switch off to rid ourselves of oil.”

Welch believes once approved, the bill will help build a stronger economy and a cleaner planet.

“There are values to using less energy and investing more in renewable energies, particularly when it comes to the environment,” he said. “There are also good, solid, economical, and practical reasons we want to do this. It creates jobs, helps companies grow, assists in profits, and allows local businesses to remain competitive.”

Industry Participation

Steve Lindenberg, senior advisor for renewable energy, Department of Energy (DOE), offered a broad overview of renewable energies including wind, solar, geothermal, and others.

Lindberg noted that the DOE released a report in May 2008 that detailed the possibility and probability that the United States could produce as much as 20 percent of its electricity supply from wind energy.

“A 20 percent reliance on wind would require significant changes in transmission systems including improved turbine technology to generate wind power and large expanded markets,” he said. “Once achieved, the benefits would include a half million jobs created for manufacturing, installation, and operations; new property tax revenues; U.S. natural gas demand reduced by 11 percent by 2030; a 25 percent of expected electric sector CO2 emissions avoided in 2030; and an 8 percent reduction in electricity sector water consumption.”

The DOE is working to lower the cost of solar energy, thus making it more cost competitive by 2015 for all U.S. grid-tied markets.

Lindenberg believes that reducing the installed cost of solar energy systems by about 75 percent will drive widespread, large-scale adoption of this renewable energy technology. He predicts that the nation may reach 16 gigawatts (GW) of cumulative installed capacity by 2020, which would restore U.S. leadership in the global clean energy race.

“We have lots of sun, and not enough renewable energy. We should be driving demand like crazy, making manufacturing difficult to catch up,” he said. “Installations will become competitive at the local electric rate and the market is currently very competitive in places like Hawaii and California.”

In addition to wind and solar energy, Lindenberg reported as much as 20 percent of U.S. electricity could be generated through enhanced geothermal systems.

Geothermal power plants are currently operating in Alaska, California, Hawaii, Idaho, Nevada, New Mexico, and Utah, producing more than 9,000-megawatts of power. The DOE believes there remains at least another 30,000 megawatts of hidden geothermal energy that could be reasonably tapped.

“Geothermal is a great opportunity. It is an amazing resource that we haven’t been able to fully grasp,” he said. “We have a capability to envision the future and to turn it into a reality. The question is when does it happen?”

Scott Hennessey, director of legislative affairs and general counsel, Solar Energies Industries Association, said the U.S. photovoltaic demand grew 109 percent in 2011, to more than 1.85 GW. Subsequently, the value of solar installations increased to $8.4 billion in 2011, up from $6 billion in 2010; and the solar industry now employs more than 100,000 individuals.

“In five years, our association has grown from four employees to 45 employees. In just one year, employment nationwide has doubled from 50,000 to 100,000,” he said. “We’ll install more than 2,500 megawatts this year and in 2016, we’re looking at projected numbers up to eight gigawatts.

“Suddenly, we’re dealing with real numbers,” said Hennessey. “This is not a niche industry anymore just putting out 100 megawatts. This is an industry sector that is outputting numbers on scale with coal plants.”

Yet, utility grid managers believe that the rise of renewables will be counterproductive if they cannot be integrated into load management strategies. Ron Domitrovic, senior project manager, energy efficiency, Electric Power Research Institute, explained that although long-term load management can be achieved through energy efficiency, short-term load management is achieved through renewable integration and demand response, allowing end users another revenue stream — another important factor in the new energy equation.

“Flexibility is the single best end-use attribute,” Domitrovic said. “The ability to adjust loads during peak conditions benefits utilities and end users. Looking at systems that respond in reasonable time and offer comfort to consumers and resources to utilities provide the best load management solution.”

What Happens Next

Michael Oldak, vice president, strategic initiatives and general counsel, Utilities Telecom Council, suggested that the recent recession has slowed the movement toward smart grids.

“The recession made huge infrastructure investments more risky and regions that were predicted to be below reserve margins are now above,” he said. “The demand forecasts over the next 20 years went from 40 percent to 20 percent, and are now at about 30 percent.”

Oldak hinted that utility companies face real-world issues as well.

“There are many real problems that utilities have that can be solved by equipment that is available today or under development,” he said. “A grid-interactive water heater is now being manufactured that has controls and a system that allows it to store water at an elevated temperature and modulate power over short time periods. It can be used as a thermal storage resource, which has gained a lot of interest industry wide. The device can also act as a regulation resource and can be used to adjust frequency or voltage demand on the utility system. This is one of many tools that can be used to manage energy loads.”

Variable-speed technology is another management device that is lauded by the utility companies.

“Flexibility in the operation of an air conditioning unit is a very serious attribute and resource to the utility grid. If an air conditioning system can react to a need for load management, through a signal or price marker, it provides a serious resource for our nation’s utility network,” Oldak said. “Variable-speed technology plays a large part into this. Variable speed provides an energy-efficiency resource, providing an incentive to the utility, plus it manages demand response, and offers load control and potentially it can provide regulation. These all come with a savings mechanism that can be applied to a single system.”

As a case-in-point, Friedo Sielemann, counselor for environment, energy and climate change at the German Embassy in Washington, D.C., highlighted Germany’s economic growth resulting from its renewable energy strategy. Encouraged by incentives, the widespread adoption of renewable energy has caused the country’s greenhouse gas emissions to decrease by 25 percent since 1990, and the gross domestic product to increase by 20 percent. In addition, Germany boasts more than 380,000 green jobs.

In the final session which focused on what it will take to drive the acceptance of solar and other renewable energies, Jigar Shah, partner at Adamas Energy Investments, suggested that third-party ownership is the single biggest innovation and moving the industry forward would require investments in branding, marketing, and training, along with off-balance sheet treatment with customers.

John Galyen, president of Danfoss North America, summarized the prospect of renewables by stating, “We are looking forward to a smart grid that provides for two-way communication between utilities and end users, and building equipment that can store site-generated renewable power for use in peak periods when generation capacity is stressed and broadly can contribute to load flexibility,” he said.

“To accomplish that goal requires better communication between utilities, regulators and building equipment manufacturers, and legislation and regulations that best align the incentives required to create and harness the required technologies.”

Publication date: 8/13/2012