capacity building of banks and financial institutions for energy efficiency project financing
DESCRIPTION
Capacity Building of Banks and Financial Institutions for Energy Efficiency Project Financing Module 5 Measurement and Verification Partnership to Advance Clean Energy-Deployment (PACE-D) Technical Assistance Program. Presentation Outline. Why Measurement and Verification (M&V)? - PowerPoint PPT PresentationTRANSCRIPT
Page 1 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Capacity Building of Banks and Financial Institutionsfor Energy Efficiency Project Financing
Module 5 Measurement and Verification
Partnership to Advance Clean Energy-Deployment (PACE-D)Technical Assistance Program
September 2014
Page 2 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Why Measurement and Verification (M&V)?
• Key Considerations in M&V
• Basic Concept of M&V
• M&V Methodologies
• M&V Protocols
• Common Issues
• The M&V Document
• Case Studies
Presentation Outline
Page 3 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Measurement and verification:• Is needed to confirm project energy savings and validate that
anticipated or guaranteed performance has been achieved
• Presents common definitions, terminology and procedures for energy-efficiency projects
• Improves communication and understanding among project implementing partners
• Provides a risk management tool to financing entities
• Minimizes disagreements and disputes
• Facilitates persistence of energy savings
Why M&V
Page 4 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Key Considerations in M&V
Page 5 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Who Should Conduct M&V?
Page 6 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• The costs of M&V depend on the energy efficiency technologies and measures to be implemented and the approach and methodology to be utilized
• M&V costs 5 to 10% of project investments
• Trade off between
accuracy of the M&V
cost of M&V
• Simple approaches are preferred to reduce costs and minimize potential for disputes
How much does M&V cost?
Page 7 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• If the project host conducts or engages a third party to conduct M&V, the host directly pays the M&V costs
• If the ESCO conducts or engages a third party to conduct M&V, the M&V costs are part of ESCO’s costs
• In either case, the M&V costs are an integral element of project cost and an allowance needs to be made in the project budget and financing plan for these costs
• While the M&V is specified in the Energy Services Agreement between the ESCO and host, the lender needs to understand and approve the M&V approach and costs
Who Pays for M&V Costs?
Page 8 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Key Elements of an M&V Plan
Page 9 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Basic M&V Concept
Page 10 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Assessing Energy Savings
Page 11 July 2014Capacity Building of Banks/FIsFor EE Project Financing
M&V Methodologies
Page 12 July 2014Capacity Building of Banks/FIsFor EE Project Financing
M&V methodologies
Page 13 July 2014Capacity Building of Banks/FIsFor EE Project Financing
M&V Protocols
Page 14 July 2014Capacity Building of Banks/FIsFor EE Project Financing
IPMVP
• Developed by a coalition of researchers and practitioners• Managed by independent organization (EVO) dedicated to
provision of tools to quantify the results of EE projects and programs.
• Provides flexible framework of M&V options that allows practitioners to craft the right M&V Plan for their project
• Internationally recognized and accepted• Certification program for M&V professionals• Implemented in India by Alliance for Energy-Efficient Economy
(AEEE)
International Performance Measurement and Verification Protocol
Page 15 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• First M&V Seminar Delhi April 2005, PCRA hosted for EVO
• M&V Fundamentals trainings in various cities of India
• Application of M&V to Government Schemes – Building Codes, PAT, DSM
• CMVP Certification Training & Exams in Delhi – Nine rounds completed more than 100 professionals certified
• EVO has Certified 5 Indian Trainers as CMVP Trainers
• AEEE has conducted M&V Training in Manila and Bangkok
• Opportunity to widen M&V capacity building to South & West Asia
M&V Training and Certification in India
Page 16 July 2014Capacity Building of Banks/FIsFor EE Project Financing
India has over 100 CMVPs
Page 17 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Retrofit Isolation Methods
Option A – Partially measured or one time measurement
Option B – Longer or continuous measurements
• Whole Facility Methods
Option C – Whole facility energy analysis
Option D – Computer simulation
M&V Approaches in IPMVP
Page 18 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Illustration of IPMVP Options
Page 19 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Adjusting for Changes in Baseline
Page 20 July 2014Capacity Building of Banks/FIsFor EE Project Financing
Adjusting for Changes in Baseline
Possible Changes
in Baseline
Possible Changes
in Baseline
Facility Use or Operating ConditionsFacility Use or Operating Conditions
OccupancyOccupancy
Equipment Operating SchedulesEquipment Operating Schedules
Environmental ConditionsEnvironmental Conditions
Additions to Energy-Using EquipmentAdditions to Energy-Using Equipment
Facility Refurbishment or RehabilitationFacility Refurbishment or Rehabilitation
Page 21 July 2014Capacity Building of Banks/FIsFor EE Project Financing
IPMVP M&V Options
Page 22 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Simple approach (and low cost)
• Performance parameters are measured (before and after), usage parameters may be estimated
• Used where the “potential to perform” needs to be verified but accurate savings estimation is not necessary
• Key features Low cost
Simple procedure
Requires agreement among parties
Option A
22
Page 23 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Under Option B, some or all parameters are measured periodically or continuously
• Applicable where accurate savings estimation is necessary and long-term performance needs tracking
• Reduced uncertainty, but requires more effort
• Key features
“Real” M&V
Improved O&M
Ongoing Commissioning
Remote monitoring
Option B
23
Page 24 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Option C looks at energy use and cost of entire facility, not at specific equipment
• Conceptually simple, may be difficult in practice
• Key features: Can consider weather, occupancy, etc.
Useful where total savings need to be valued but component savings do not
Commercial software is available that simplifies implementation
May require baseline adjustments
Option C
24
Page 25 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Option D treats building as computer model
• Flexible, but requires significant effort
• Applications:
New construction
Energy management & control systems
Building use changes
Building envelope modifications & additions
• Uses specialized software that requires substantial experience
• Requires measurements for calibration
Option D
25
Page 26 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Baseline is 100 W light bulb and new lamp is 25 Watt compact fluorescent
• Wattage verified by measurements/specifications
• Assume 3,000 operating hours per year: Previous experience Estimate by owner
• Calculated Savings are:
3,000 hr/yr * (0.1 - 0.025 kW) = 225 kWh/year
Example of Lighting Project M&V - Option A
Page 27 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Install meters on lighting circuits (before lighting retrofit is implemented)
• Measure consumption before and after retrofit for a specified time period
• Calculate savings
Lighting Project M&V - Option B
Page 28 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Used when lighting is the dominant load
• Document baseline utility bill
• Obtain post-installation utility Bills
• Calculate savings
Lighting Project M&V - Option C
Page 29 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Used when interactive effects need to be estimated
• Input lighting and HVAC system into simulation program.
• Calibrate model and calculate pre- and post-installation lighting and interactive HVAC energy use for determining savings.
Lighting Project -Option D
Page 30 July 2014Capacity Building of Banks/FIsFor EE Project Financing
1. Lighting Efficiency and Controls 2. Motor and Drive Efficiency Improvements 3. Variable-Speed Drives 4. Boiler Improvements 5. Chiller Improvements 6. Air, Water, and Steam Distribution
Systems 7. Thermal Energy Recovery 8. Controls
Option A: One-time metering ○ ○ ○ ○ Option B: Continuous metering Option C: Utility Bill Analysis Option D: Computer Simulation 1 2 3 4 5 6 7 8
M&V Options with Multiple End-Uses
Page 31 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Factors affecting saving performance Predictability, measurability, factors such as weather, occupancy,
equipment intensity, ability of EEMs to deliver savings, implementation effectiveness, occupant – operator cooperation, equipment deterioration and life
• Evaluating saving uncertainty Instrumentation error, modeling error, sampling error, planned and
unplanned changes
• Minimum energy Standards• Minimum operating conditions
Common M&V Issues
Page 32 July 2014Capacity Building of Banks/FIsFor EE Project Financing
• Energy Prices
For simplification, price is specified
• Verification by a third party
Third party can resolve issues
• Baseline adjustments
Routine and non-routine
• Cost
Cost to owner against benefits
Common M&V Issues (continued)
Page 33 July 2014Capacity Building of Banks/FIsFor EE Project Financing
1. Project site and measures
2. M&V option selected - Options B or C
3. Details for calculations
Data collection plans
Assumptions
Energy rates
4. Baseline equipment and conditions
Equipment, space conditions, assumptions, energy use relative to production, adjustments – how and when
M&V Information Document
Page 34 July 2014Capacity Building of Banks/FIsFor EE Project Financing
5. Post-installation equipment and conditions Plan for defining new equipment and space conditions, assumptions
and stipulations
6. Metering Schedule of metering (duration/when), who will provide, data
validation, sampling7. Measurement and verification activities
Who conducts M&V, analysis and prepare report, quality assurance, reports defined and post installation energy use relative to production
8. Initial and annual cost
M&V Information Document (continued)
Thank you
Dilip R. LimayeMahesh Patankar
Finance TeamUSAID PACE-D Technical Assistance Program
[email protected]@mpensystems.com
www.pace-d.com