The phrase that always has me reaching for a complimentary bag that can be found in the seat pocket in front of you on an airplane is “Best Practice”. Are you following “best practice”? Are you familiar with “best practice”? Will you use “best practice”? No. No. And no.
Define best practice, anyway. What does it mean? It’s something someone with many letters in their title block, who was paid a princely fee to declare, “This is the way it ought to be done”. Let’s examine a few deep thoughts on this concept.
- “Best practice” infers this is the best car, shirt, beer, house, bicycle… for you. What if your friends or coworkers you frequently haul around in the back seat of the car are tall and best-practice man recommends a best-practice Nissan Altima? I can tell from experience riding in the back seats of rented Altimas that they have no headroom, and I am not a tall guy. Consider EE program evaluation: The typical portion of an EE program budget (total) available for program evaluation is 3%. The sample size for producing the industry standard confidence and precision targets is typically in the 70 project range, almost regardless of the size of the population. Do you think 3% is the right number to budget to evaluate PG&Es residential lighting program and 3% is the right number to budget for Rochester (Minnesota) Public Utilities residential lighting program? Best practice – in the garbage can.
- Somebody paid the best practice man to produce “best practice” and therefore, “best practice” is available to the public. If it isn’t available to the public, how can it be declared “best practice”? If we are asked in an RFP to do stuff via “best practice”, where is it? It’s available on the internet somewhere, like advice for curing hiccups. The fact is, if it is available to the public, “best practice” actually means “status quo” or “not worst practice” or “folklore”.
- “Best practice” is something you want to advertise? Who writes a proposal and enthusiastically scribes they will deploy industry “best practice” for the client? Firms that die. That’s who.
How about these best practices, which I Jeff Ihnen, P.E., MS ME, LEED AP, JBJBJee provide for free:
- Best practice is never use the term “best practice” when describing how you will handle a project for a client.
- Best practice is explaining how you understand the client’s plight, challenges, and interests and how you will take care of them for the client. I will not deploy the square-peg “best practice” to your round-hole problem.
- Best practice is completing stuff on time for the client.
- Best practice is producing accurate results that reflect reality; results that will not come back to bite a few months after best-practice man flew home and started deploying “best practice” for other clients.
- Best practice is telling clients what they need to know and not what they want to hear or what you want to tell them.
- Best practice is working for clients who want to know what they need to know.
- Best practice is producing clear demonstrable results, not merely trying with “best practice”. Trying is for young kids. Results are for adults.
- Best practice is bang for the buck, not paying for ridiculous precision on something that doesn’t matter.
- Best practice is doing what the client needs, not what the consultant wants.
LEED has resulted in common examples of failed “best practice”. LEED is taking a pounding with high profile news outlets and lawsuits but the best practice known as LEED is NOT the problem. The USGBC is NOT the problem. The problem is practitioners who have no business developing green buildings. They don’t understand energy consumption and efficiency. They don’t know how buildings work. They don’t understand building automation systems. They can’t follow instructions to do things differently. They design and build the building as usual and look at the paperwork at the end as a useless function. What does one expect?
Building a “green” building is exactly like cooking a delicious meal for guests. Cooking a delicious meal is easy 95% of the time by following instructions in the cookbook – but you HAVE to follow instructions. The usual LEED building process goes like this: brown hamburger, cook macaroni, add Hamburger Helper, “where’s my plaque?”. No offense to Hamburger Helper, which was derived for “cooks” who can barely handle boiling an egg and for busy people with a pack of ravenous kids to feed, but in the end it’s Hamburger Helper. It’s what you get from people and firms with no skill. It’s “best practice”.
 The 5% that is difficult takes a lot of experience – things such as bread and pastries require skill and experience.
In many states that are relatively new to energy efficiency, legislators often cave to large energy users and allow them to opt out of programs because hey, they use a ton of energy and therefore, OBVIOUSLY to any moron, they control and manage these costs as well as any dunce could. Why should they throw money at a program that won’t help them?
Come to think of it, programs available to these large users in many places are dysfunctional, poorly conceived, and not thought through from the perspective of the customer, so I can see their point to some extent. I already have a type of colossal program failure that has been proven to produce nothing in many jurisdictions and I’ll talk about that next week or some other time.
The only real reason for large users opting out is that they think they can better spend the relatively tiny bit of money they would contribute to the program or more likely, they’d rather not pay anything and continue with business as usual. Both are foolish.
Let’s just use an example of a large user with $10 million in energy costs, paying 1% to the EE fund, which is $100,000. This sounds like a lot of money. It is not for a company of this size.
Allow me to demonstrate how foolish opting out is, using a rule of thumb that program incentives typically equal one year’s energy savings at minimum (I have seen incentives as high as FOUR year’s savings, in which case a psychiatric evaluation should be ordered up for opt-outs). Companies that opt out generally have to meet the savings goals the utility needs to meet in return for opting out, and this too, is generally in the region of 1% of sales, or in the case of the customer, 1% of consumption.
Take an opt-out and opt-in comparison for the above $10 million customer for a $200,000 project with $100,000 savings. ASSUMING no difference in customer time (time is money) and expense, the ROI is exactly the same. The opt-in customer pays $100k to the EE pot and gets it all back as an incentive for doing the project. However, the reporting for the opt-out customer will take at least $10k, I would guess, if they do a decent job.
Now suppose the investment is doubled to $400,000. The opt-in customer still only pays $100k into the program but gets $200k back in incentives. The customer starts to take other peoples’ money as he implements larger projects. Suddenly, the ROI starts quickly rising above the opt-out scenario.
The only way the opt-out customer comes out ahead is if they plan to do nothing, in which case, rather than paying $100k into the EE pot, they pay nothing, all else equal. So, the scenarios become:
The “opt-out do nothing” scenario cannot stand, because customers agree to meet their goals, and this too, is where the BS continues. The typical opt-out customer includes manufacturers. Efficiency to manufacturers many times means high output and no shutdowns – not low energy use per unit of production – aka, ENERGY efficiency. Due to the lack of EE expertise beyond lighting, we see many doozers when evaluating projects from customers that opt out.
To use one example I used before (company name and project totally made up to protect the guilty), a baseball bat manufacturer switches from manufacturing wooden bats to aluminum bats. Wood requires the operation of a large kiln for drying, lathes, lacquer and all this sort of stuff. Making aluminum bats allows them to shut down the kiln, turn off the lathes, lay off half the workers, close half the facility, and increase production. The energy consumption per bat decreases. Problem: this is a totally different manufacturing process. The baseline is not the manufacture of wooden bats. The baseline is standard practice for making aluminum bats. What is that? At the point of evaluation, they don’t know. No alternatives were explored when they switched. There are no savings here. What a mess.
Another one includes a “behavioral” change where instead of running shifts every day of the week, the customer switches to running around the clock fewer days, primarily due to long wait times to start up and shut down every day, wasting energy and labor. Programs are not meant to incentivize avoidance of obvious absurdities. We probably don’t have the whole story, which may include going from 24/7 operation to 24/4 operation. No, reducing production is not energy efficiency.
Smart large users opt in and leverage the program for all it’s worth. Even the hugest, most goal-driven companies saving dozens of megawatts (no kidding) leverage programs to the max. Somebody has to save energy and demand and it may as well be me, large user. I take money paid from my less intelligent competitors and other citizens; my utility loves me because I am making giant steps toward their mandated goals; my colleagues in other parts of the country are envious; my CEO loves me because I’m substantially adding to the bottom line and reducing risk; and I take a huge administrative/management burden off my plate and give it to the program/utility.
If this is not a competitive advantage, I don’t know what is.
 Opt-out customers must file their own plans and reports just like the larger utility program and that takes substantial time to do any sort of reasonably acceptable job.
 A rider is an added fee, usually per unit energy used for energy efficiency, fuel cost adjustments and other things.
Last week ACEEE produced a webinar, “Intelligent Efficiency”. I was late to the party but as I came online, an ACEEE guy, Neal Elliott was talking and the topic was intriguing – system-wide, holistic, intelligent efficiency. I thought, hmm, maybe somebody read this entire series of rants and was possibly preaching from the gospels of the obvious.
Next up was a guy from Schneider Electric and he gave a boring advertisement of – Schneider Electric. Next was a guy from Johnson Controls to talk about what else – the Empire State building. The Empire State Building EE overhaul has been in every trade magazine, newspaper, crap magazine (Time, Newsweek), The National Enquirer, Star, Vogue, Bon Appétit, Weight Watchers, Cigar Aficionado, Esquire, Cosmo, Sports Illustrated, Readers Digest, Playboy, Parent, billboards, newspaper ads, taxis, subway cars (next to the toe fungus, tattoo removal, gout prevention, sleep apnea and hernia repair shop ads), buses, elevators, church and synagogue bulletins, PSAs, restaurant menus, grocery carts, cereal boxes, milk cartons, toilet stalls, gasoline pumps, dentist, veterinary, and doctor offices, 60 Minutes, 20/20, The Apprentice, Dancing with the Stars, Letterman, Leno, SNL, and Jimmy Kimmel. I immediately pulled the plug before nausea set in. I only have about two or three more times I can absorb shameless JCI / Empire State building propaganda before I throw up till my gall bladder bleeds. Get it already?
Fortunately, ACEEE published a paper on the topic. Intelligent Efficiency includes three components: People Centered Efficiency, Technology Centered Efficiency, and Service Oriented Efficiency.
People efficiency includes the constant bombardment of information so consumers can change behavior to save energy. An example given includes monitoring home energy use over time to see when and how much energy is used to modify behavior. Similarly, information can be provided at the organization or community level to “invite human behavior” into the system.
Technology efficiency includes gizmos that optimize facility, industrial and transportation efficiencies. Users program and commission the gizmos and watch the savings accumulate. Sounds good. However, they are talking beyond fixing systems that are already controlled by energy management systems. They are talking about anticipatory elements like weather forecasting – turnip milking.
Service oriented technology includes stuff like virtual meetings, webcams, webinars and beaming up Scotty.
In regard to people efficiency, people need to give a crap before they are going to do anything. I go back to something I wrote many posts ago – something I took from a senior member of a client of ours. She compared smart meters and energy information bombardment for customers with that of nutrition information bombardment. Has there ever been more nutrition information available and in your face, and have obesity rates ever been higher? Answers: no and no. Regarding energy efficiency, this just in: American’s know how to save energy in many ways, but don’t – great timing. Six in ten say they lack knowledge for EE as a major reason for not doing anything. The other four vastly over estimate their capability. And wouldn’t you know it, nearly all programs merely throw money at EE and very few provide decent information for commercial and industrial. Actually, some jurisdictions close to home (hint, hint) discourage and in fact see customized EE plans as a waste of money. Ignorance is bliss.
When it comes to intelligent controls and artificial intelligence, how about fixing the grotesque levels of waste that is present in many commercial and industrial buildings. To put it in lay-androgynous-person terms, many facilities have the equivalent of the furnace, air conditioner, oven and wash machine running balls out while all the windows are open and on top of this, comfort and/or production still suffer. I scream this over and over but apparently closing the windows and turning off the heater in summertime isn’t sexy enough. Lack of specific, custom INFORMATION is the problem. We’ll have a case study with a real project as a perfect example with a happy ending sometime this summer.
I suggest starting with the things that save 25% right off the top with an ROI of 150% before installing anticipatory fuzzy logic to determine peak coffee making time to trim back on the air conditioning to reduce electrical demand. Ok?
Here is a dirty secret as an example. The country could save billions on energy cost simply by opening throttle valves and controlling pumps properly with variable speed drives in commercial and especially industrial facilities. Barrier: Manufacturing staff barely have time to keep the wheels on. Expenses, especially labor, is cut to the bone and companies are making record profit, but they don’t have time for EE spotting and implementation. The EE program “energy adVISEr” should point this out, but if it isn’t a T12 light bulb, it isn’t in the “adVISEr’s” wheelhouse. One has to know what a valve, or a pump for that matter, looks like to fix it.
One final note – one of the primary barriers to “intelligent efficiency” as noted in the report is high up-front cost. This could be the case in some instances, but we have experienced facilities with the report’s referenced brands of controls – the latest and greatest fully capable of everything they are talking about – controlling systems that are wasting epic tankers of money.
Controls don’t save energy. Smart people using controls save energy. Educated and informed facility and process managers maintain the savings. Is anyone listening?
 Did you know that “balls out” is in reference to governors that control / maintain engine speed? “Balls out” simply means the engine is running fast.
We interrupt this rant for this special announcement. Our cold spring in the northern plains is wreaking havoc in the form of tornadoes in the southern and middle parts of the country.
I think the weather phenomena had a lot to do with my interest in mechanical engineering. Growing up on the farm in the flatlands, I had seen a great many black clouds approaching on the horizon. As they drew closer, they would either brighten to a lighter gray and rain, or they get ugly. If the approach is led by a dark band of clouds followed by blue-green solid color all the way to the horizon, there would be some serious energy release. If there is continuous rumbling, it generally means hail – tornadic-type winds aloft.
Weather should marvel any mechanical engineer with interest in the thermal fluids side of the curriculum. All weather conditions are driven by temperature differences in the atmosphere and it’s influenced heavily by ocean temperatures to the west from which prevailing winds and jet stream flow, at least in the northern hemisphere. It’s a massive thermodynamic, fluids, and heat transfer model.
What is causing this year’s massive tornadic outbreak? Unusually cold mid and upper atmosphere derived from cyclically cold Pacific waters.
The two best weather guys I’ve seen in the business are Tom Skilling from WGN and Joe Bastardi from AccuWeather.com. Bastardi is a historian and doesn’t get whisked away with the hype. He states the mid levels of the atmosphere have cooled very rapidly in the past year as it did 60 years ago. Did you know this? No. Why? Because nobody is reporting it. This makes sense because powerful storms, which are like engines, are driven by great temperature differences; NOT an overheating atmosphere.
Tornadoes form when warm air from the southeast plows into cold air from the northwest. The warm, moist air rises into the cold mid levels of the atmosphere, and of course what goes up, must come down. Condensing water vapor turns to rain and if cold and turbulent enough develops hail falling to the ground cooling the air as it falls. This air flow can become strong enough to cause straight line downdrafts that can flatten buildings and trees like a tornado. When the warm air channels, it can become like the vortex in your bathtub or sink. It will start to rotate to form a tornado. For a great cartoon of this, click here. For the real deal, see this minute-long video from National Geographic – devastating.
Fortunately, the pattern that set up these storms in the south just broke over the weekend. Hopefully, we won’t get our turn in the north but it’s certainly possible. The jet stream, or line between cold and warm air has lifted far north, hence the warmer weather we are experiencing in the north.
All engines, including power plants, your car’s engine, jet engines, are driven by hot and cold sinks. The greater the temperature difference, the greater the power, and efficiency. A tornado is an engine. It is driven by temperature differences in the atmosphere and the “load” is the destruction it wreaks on the ground. When towns like Joplin, MO appear to be run over by a giant lawnmower, the giant lawnmower requires tremendous power, delivered by an F4 or F5 tornado.
This presents an opportunity to generate electricity. No; not from tornadoes, but from waste heat being dumped from power plants.
I would guess that when anyone thinks of a nuclear plant, they think of these cooling towers. These towers work on a very simple concept. Warm water from the power plant is pumped to the top and showered down through the tower. Openings at the bottom let in cool dry air from the surroundings. The warming and humidifying of the air causes it to rise and a natural draft occurs. Therefore, fans are not needed. Towers need to be tall enough and shaped like they are to generate sufficient air flow via “stack effect” to provide required cooling capacity.
This presents an opportunity to generate electricity. Not just from the vertical rise in the tower, but all the way to the upper atmosphere. If rotation were induced, an engine could be developed between the hot exhaust and the always very-cold upper atmosphere – a standing tornado, essentially.
Don’t laugh. I first came across this in one of the power industry’s trade magazines a year or two ago, and it made a lot of sense. It’s called an atmospheric vortex engine. Here is a good paper on the topic from the Canadians, ay?
So I ask, why is the DOE not pursuing something like this, rather than the STUPID electric car? Silly me. This is potentially cost effective energy efficiency with huge potential from a ubiquitous plentiful source of free waste energy; not an ALICE IN WONDERLAND pipe dream. If we can build nuclear reactors and sophisticated huge steam turbines, surely this simple concept can be harnessed.
Seventy percent of energy required to fuel a thermal power plant (natural gas, coal, nuclear, fuel oil) is dumped to the surroundings. Think of the potential – and nothing extraordinary is required. Nature takes care of the vast temperature difference to drive the engine. The efficiency of this second heat engine would be approximately 30% per the above paper. This could take conventional power plant efficiency from the standard 30% to roughly 50%, roughly a 70% increase. This is enormous.
I’ve always considered global warming to be driven by politics and self interest, knowingly or unknowingly – as in, I can make money from this. It is fanned by sensational films like that described in the aforementioned Dumb Bear post, Al Gore (who’s film the UK banned from its schools) and even National Geographic – it sells – see how it works? It’s easy. More below.
The very cold spring and gobs of snow this winter have been devastating. Dude! Aspen reopened for skiing over the Memorial Day weekend – with more base now than it had on New Years Day! This is normal? It’s insane! Mammoth Mountain in the Sierras still has 200-plus inches of snow – plan to ski through July 4!
How does paranoia void of logic and reason perpetuate? The Center for Decision Sciences at Columbia Business School did a survey of 1,200 in-duh-viduals, “Those who felt that the current day was warmer than usual for the time of year were more likely to believe in and worry about global warming than those who thought it was cooler outside. They were also more likely to donate the money they earned from taking the survey to a charity that did work on climate change.” Even if INDOORS is hotter, people tend to fear global warming more!
In other findings: if you eat soup frequently, check with an emotional counselor; want that job, wash your hands in hot water just prior to interview; worried about crime, get out of dodge when it’s hot outside.
written by Jeffrey L. Ihnen, P.E., LEED AP
Back in August I came close to posting a blog “Enough of the Empire State Building Already” but that one faded away. In case you never read anything about energy savings and sustainability, the building is undergoing a $20 million renovation to improve energy efficiency. The project would shave the facility’s $11 million energy bill (a cool $4 per square foot) by 38%. Johnson Control ran ads in every trade magazine I get and various publications, including major newspapers, ran articles by the dozens.
Coming in a close second to the Empire State Building was the Northland Pines High School in Eagle River, WI. Apparently it was the first LEED Gold certified High School for New Construction Version 2.1. Ok. It seems everybody associated with the project ran an ad for their greatness: manufacturers and vendors of stuff used for construction, contractors, service providers, congress people, the governor, priests, rabbis, dog catcher, and the feral animals themselves. This went on for months.
Well it all hit the fan. As I was flipping through my stack of trade magazines this long holiday weekend, I saw in HPAC (short for Heating Plumbing and Air Conditioning but they actually go by HPAC – HPAC.com) in their August issue that a group of stakeholders including the building committee, a couple licensed professional engineers, and other taxpayers are appealing the certification with the USGBC. They claim the design does not and cannot meet indoor air quality standard ASHRAE 62, minimum energy performance, ASHRAE Standard 90.1, OR the minimum commissioning requirements. Ouch! What do you feral animals have to say for yourselves now?
I’m not going to do a ton of investigating of this crime but I have no reason at all to believe the appellants are not standing on firm ground. What is interesting is the firestorm of HPAC reader comments, which read like blog comments of far left and far right cutting each others’ livers out. Jeezo, the comments are still swirling three issues AFTER the first mention of it in August. Comments include the following, each of which I respond to:
- One of the points I raised concerned legal liabilities and the USGBC’s refusal to accept responsibility for advice about guideline compliance.
o The USGBC shouldn’t have responsibility for advice it gives. It’s up to the design and construction teams. The guidelines are available. If they can’t read, find new firms to do the job.
- The USGBC seems to prey on undereducated, uninformed owners and the public.
o Nice. There are certainly uninformed folks, but I’m sure the USGBC is a deceitful money grubbing outfit headed by Gordon Gekko’s offspring. The guy would probably dump a five gallon bucket of used motor oil in the lake if you paid him $100.
- LEED is a standard of relative greenness, not a contract for overpaid lawyers and underemployed engineers to litigate. …the LEED process has been a powerful force bringing green design mainstream.
- LEED is bogus. Let common sense prevail. Why can’t you simply tell the architect/engineer firm(s) to design the most EE building you can without a third party intervening?
o Because cheap and crappy always wins the bid and the average firm doesn’t really know squat about REALLY producing an efficient, comfortable, and code-compliant facility.
- I agree [not me – the next guy reader/commenter]. USGBC does not check if equipment is installed per drawings.
o If it did, it would cost a fortune and no one would do it.
- [in response to the previous statement the next guy says] Get a life. LEED is a standard of relative greenness… blah blah. [The exact same statement as above by the same guy, published two months in a row]
- [in response to the previous] Mr. Perkins just doesn’t get it. Building green just to get LEED points, rather than building a building that will improve the health of occupants[with minimal] lifetime costs, is total BS… Too many folks just care about LEED certification, not if a building really works.
o In my opinion, LEED actually improves the odds that a building “really works”. It requires somebody to at least fake their way through commissioning and at least think about designing for efficiency and healthy environments. To say LEED diverts designers and contractors away from these things is irresponsible.
I mentioned before in this blog that our MO is to fix immediate problems first and take corrective action later. Too frequently building owners/stakeholders go after the party they think is responsible and meanwhile the building festers away. The second too-frequent approach is to hire the same fools responsible for the kludge to fix it.
Owners and stakeholders should first fix the problem by hiring somebody who knows what they are doing. This does two things, both of which they want to fix a screwed up building: (1) gets the building working optimally as soon as possible and (2) by doing so gives them leverage with the responsible parties for some sort of settlement.
Attacking USGBC for establishing green building methods and metrics but not enforcing them with an iron fist is ridiculous. Why not go after ASHRAE for not coming down on people like a ton of bricks for not following ASHRAE’s standards? Energy codes that are state law in many states aren’t even enforced in some of them. I’m not sure about the rest of the parties involved with LEED projects but engineers have codes of ethics. I would say blowing off owner desires, cutting corners and lying about what was or was not done probably violates these ethics. How about attacking these losers and scoundrels and running their underwear up the flagpole instead?
I would guess you haven’t heard but the Chicago Climate Exchange is shutting down. At one point in this blog I explained I think that trading something that has no value in and of itself is unprecedented. Currency is only thing I can think of that has no intrinsic value but currency is actually a means to put value on things. I can buy groceries with currency. I can’t buy anything with a carbon credit.
Numerous corporations were buying carbon credits and even “supporting” the legislation in the event some sort of cap and trade passed. The legislation disintegrated and there remain only a few ashes of political will to even whisper the phrase. The carbon value that existed was 100% speculation. The value that remains is 100% nothing.
As I mentioned in a recent post, if cap and trade didn’t pass during last congress with unstoppable majorities in both houses and the White House, I don’t see it happening. This does not rule out the EPA creating their own laws to put a price on carbon dioxide.
In “The Nebulous Green Job” I ranted about Green Jobs, of all things. As it turns out the green jobs stimulus portion of the stimulus has not been too stimulating. The Washington Post reports that the recently green-educated graduates are having difficulty finding work in solar energy installation, green landscaping, recycling, and green building demolition. Well, heeeyeah! Electricians and plumbers are on the prowl for PV and solar water heating systems. There is already a live and well recycling and building demo industry. I just burned up “the tube” in my microwave oven this weekend and the nice local do-everything, small but mighty superman store otherwise known as Coon Valley Dairy Supply replaced it. I asked what they did with the old ones. A local guy picks them up and strips them down into piles of materials to be sold to buyers – no government green-job intervention included. Cool! If there is a market people will find it and fill it.
written by Jeffrey L. Ihnen, P.E., LEED AP
I was pretty much like every other 12 year old boy. I liked fire, explosions, and crashes. If you think I’m crazy, why are movies sometimes beginning to end filled with the same? Enough said. Growing up on the farm there were always plenty of things to burn. One time I asked my dad if I could burn an old cattle feeder that we no longer used. No problem.
You never see these things anymore but they were wood structures, like a weekend cabin that could withstand an F4 tornado, except it was all wood, nails and fasteners – solid fuel. So I loaded it up with 40 or 50 paper feed bags – like the big dog food bags. This probably would have been enough to get it going and burn it down. But I’m impatient and I want a big fire. So I grabbed a milk jug and put some diesel fuel in it and thought, eh, what the heck. I’ll go half and half with gasoline. I knew gasoline was risky.
So I sprinkled that all over the pile of paper bags and lit a bag (there was a door on the end about waste high). I watched the flame creep up the paper until it got into the fuel-soaked portion of the bag. That started to burn as I watched and then, Fahwoom! A giant fireball blew up and rolled me back, bass over teakettle like when I was kicked one time by a cow – which may explain my dementia. Fortunately, I knew I was playing with fire and I was prepared to backpedal real fast. All I got was singed hair on my arms, knuckles, and eyebrows. I got what I wanted though! It was a hell of a fire.
As I mentioned a while back, I’m an efficiency freak, and not just for energy. I also get riled up regarding economic efficiency and how it could impact our industry. There are many things that apply the brakes and throw sand in the gears of the economy but I’ll get to that later.
This week, I want to discuss the Federal Reserve (Fed) rather than energy efficiency directly because the stakes are enormous and I think everyone should know what is happening. For years and years (forever) there has been a lot of concern about the nation’s debt. Why? I would guess that 99.9% of Americans think we will need to pay it off sooner or later and that’s going to hurt like a tooth extraction with no painkiller. If only.
Last week beneath all the election buzz the Fed announced it would buy $600 billion in U.S. Treasuries over the next six or nine months. This is on top of the $1.3 Trillion it’s already purchased. These numbers, by the way, are staggeringly incomprehensible. See what a trillion dollars looks like. I did a little “measurement and verification” on this and it appears to be fairly accurate. Furthermore, companies in the U.S. have a total of $800 billion cash on hand. So in the end, we are talking 2.5x companies’ cash on hand.
What is the Fed? It’s a mysterious central bank with twelve regional banks run by appointed egg heads who are accountable to no one. Typically, these people have spent their entire lives in academia, politics, think tanks – i.e., a parallel universe. They set the federal funds rate – the rate central banks charge one another for overnight loans. When they talk about cutting or raising interest rates, this is it. The Fed’s mission is supposed to be monetary stability; to avoid extreme fluctuations in inflation, deflation and the exchange rate of the dollar. If you have an interest bearing money market fund or certificate of deposit, you already know these interest rates are zero. Controlling the federal funds rate is all they normally do, but they are now going crazy.
Real lending rates (personal/business loans) for all of us track interest/yield on federal Treasury bonds. For example, the 30-year mortgage tracks in step with the 10 year Treasury bond (I think). The 15 year mortgage tracks the 5 year Treasury and so on. “Real” interest rates are set by the marketplace by buying and selling bonds and other debt.
Never think you can’t lose money in bonds. Bond prices and interest rates move in opposite directions. For example, a thousand dollar bond may be issued at 5% interest. Consider the $50 payout fixed. In this simple example, it would pay $50 per year in return for your cash and risk. When interest rates go up to 7%, the value of your bond drops because it’s paying you only $50 per year and the bond price will adjust to reflect the current 7%. The value of the bond would drop to something probably in the $70s. The opposite would occur if interest rates drop.
It’s all supply and demand. If there is tremendous demand for bonds, the bond price is high relative to the interest rate. Enter the Fed.
The nearly $2 trillion in bonds the fed will own will be purchased with freshly printed money. They are buying U.S. bonds with funny money. Why? To “stimulate” the economy. By sopping up bonds like crazy, they get very low interest rates. The borrower (U.S. Treasury) wants to sell bonds with the lowest possible yield and as long as they have the Fed throwing gazillions at them, it’s easy.
Many of you have probably refinanced your homes at unheard of rates lately as a result of this Fed activity. That’s great and you should do it but don’t for a minute think the ball-peen hammer isn’t coming around.
Here is the risk. The huge gamble the Fed is making is artificially driving down the cost of borrowing to spur the economy so people buy stuff. They hope the economy will get going and people will pay taxes to lower the deficit/debt and have money to invest in U.S. bonds, rather than the Fed doing it all with funny money.
Injecting all this cash into the world economy and “monetizing our debt” is driving down the dollar. Supply and demand. More dollars floating around, more supply, means the value declines. All you have to do is watch commodity prices for the results. Comparing to a year ago: Gasoline up 10%, Gold up 23%, Silver up 42%, Copper up 27%, Corn up 55%, Soybeans up 22%, Beef up 13%, Cotton up 117%. Do you think this escalation is due to supply/demand (although cotton, used to make the greenback is really up)? No. They are up in large part because of a weak dollar. It’s inflationary for us. You can easily find information on rising food prices in case your trip to the store doesn’t do it for you.
A weak currency is good for trade to a certain extent. A week dollar generally means a strong yen, euro, franc, pound, etc. Strong currency means people from these countries can buy American goods for cheap because they exchange their highly valued currency for a lot of our currency and buy our stuff. The opposite is true for us. Imports are expensive, which also puts upward pressure on inflation. This is great until the people buying our debt start to squeal. Go back to that thousand dollar Treasury bond. If that is purchased with Japanese yen and the dollar subsequently drops 20% against the yen, the Japanese guy is stuck with crappy dollars so when he cashes out, he gets 20% fewer yen than he would without the devaluing. Or he can just keep his crappy dollars and hope for the best.
So what the fed is doing is very dangerous. They are devaluing the dollar. The Fed can’t keep printing money to buy bonds. Sooner or later the debt will need to be financed with real money from real investors seeking what has been the safest investment on the planet. Continuing to use printed money, the currency will continue to fall until foreign investors that are buying like 40% of our debt give us the middle digit and pull out. Then what?!! Trillions of dollars will be lying about. Everyone has cashed out and the U.S. dollar won’t be worth anything because nobody wants them and there are gazillions of them. Compounding the problem, interest rates will go sky high because the Treasury can’t find people to buy their debt that melts faster than a Klondike Bar in downtown Bagdad on a summer day. Inflating our way out of debt is easy but devastating.
The Fed and the government have to stop treating employers and investors like lab rats. We are not stupid. We can see the lunacy. And they wonder why they can’t “create jobs”.
I’ll be out buying gold bullion at $1,400 an ounce to hide in an undisclosed location. Once it takes a grocery cart full of cash to buy a loaf of bread, I’ll be able to buy the bakery with an ounce of gold.
There are other very negative consequences of buying debt with printed money. First, it takes a lot of pressure off free wheeling congress to control the deficit. Second, what is the Fed going to do with all these bonds that pay extremely low yields once interest rates start rising? They are going to lose a gazillion dollars selling worthless bonds, that is if the economy ever gets going. Who will take that hit? Sounds a bit like Fannie and Freddie to me. Taxpayers will be stuck with that bag.
Since we lab rats won’t behave like they do in a text book, things may not pick up for years and years. See Japan which has tried this for what, 20 years? They have enormous debt. Government tried to stimulate the economy about a dozen times. People aren’t spending due to deflation. Stuff just keeps getting cheaper as they sit on their cash. This with the Fed’s activity has dropped the value of the dollar by 15% against the yen since April of this year.
U.S. officials are being lectured around the world about these reckless policies. The death spiral of 2008 was all due to ruthless, evil banks, we are told. Well the Fed has had interest rates very low for a long time, in addition to congress pushing home ownership onto people who can’t afford them. We had a stock market bubble in the late 1990s. A commodity bubble just before the 2008 collapse and the housing bubble just popped. Another commodity bubble is building and I would say the late stock market run-up is building a bubble as well. Stocks are rising as companies are improving earnings by slashing costs – laying off people. This won’t last as companies have limited costs to cut.
When will these people look at past policies and the ensuing results and learn from history, rather than their bogus theories? The economy is not like physics where there are laws like gravity, speed of sound, and conservation of energy. The economy has a huge macro human element. The most accurate prediction of what will happen can be found by looking back at history. I remember as I sat on the sidelines in the late 1990s while people were paying insane prices for stocks. Valuations were far, far outside historic norms. But we were in a different era. Sure, Sonny. The NASDAQ composite has gained minus 50% since then.
Thinking hyperinflation could never happen here is short sighted and dangerous. Nobody imagined 9/11, the submersion of New Orleans, or last summer’s unstoppable oil spill. The Fed didn’t prevent the 1930s from happening and they won’t stop the next one either. In response to the 1929 stock market crash and recession, Hoover did exactly what gave us 10 years of misery; raised taxes sharply to cut the deficit and Smoot Hawley to cut off trade with the rest of the world. We are trending toward the same thing all over again. HELLO!
Lastly, I’ve said before that we need a strong economy and demand for energy to have a strong EE industry. We’ve done ok through this recession but no one will care about EE when the dollar isn’t worth the paper it’s printed on, or we spend the rest of my career in a grinding contraction like Japan.
Back in March I railed against daylight savings time because it doesn’t save energy. National Geographic referenced reports saying the same. But one study claimed there was savings: The Department of Energy. The hell you say! It saves precisely 0.02% total energy consumption. This reminds me of predicting CO2 levels by viewing 500 year old tree rings. The reported precision is about 1000X greater than they can possibly measure or calculate with confidence. I wonder how many millions of dollars somebody got to build a model that would support the answer they pulled out of the air to start with.
 Do not construe this as investment advice. Roll your own dice at the casino of the Federal Reserve.
written by Jeffrey L. Ihnen, P.E., LEED AP
Many posts ago, I wrote “The More You Spend, The More You Save” explaining how poor system control wastes energy but results in even greater energy savings for efficient equipment. For example, consider an air handling system that wastes heating energy provided by an efficient boiler. The boiler saves x% versus a conventional model, so x% multiplied by greater use (wasted energy) results in “more” savings.
Recently I picked up on buzz that argues greater efficiency results in greater energy consumption. At one point I recall reading in the Wall Street Journal an editorial that argued more efficient vehicles just result in people driving more. They live further from work. They go on joy rides. They visit the in-laws more. I scoffed at this argument, at least at current gasoline costs and anything near them. If I buy a hybrid that gets 50 mpg versus a “sports car” like an Infiniti G35 coupe that goes half as far on a gallon of gasoline, I will drive more. No. Way.
I will drive more (barely) if (1) I have a car that is fun to drive and (2) I am in an area where it is fun to drive. While I haven’t driven a hybrid, I don’t think it would meet my criteria for #1. As for #2, western Wisconsin is a driver’s and biker’s paradise because (1) it is scenic (2) there are lots of smooth, paved, and curvy roads on which to drive and (3) there is minimal traffic. Quite frankly, I’m much more concerned about striking a deer, coon or coyote than another vehicle. I used to live in the DC metro area. Forget it. You might as well drive a tin can because you are going nowhere fast. I grew up in Southwest Minnesota. Forget it. You can drive for miles without moving the steering wheel. But even so, living here in driver’s paradise, I have limited time so I never, ever think, “ooh boy, a 45 minute drive is only going to cost me $2.79 in gasoline – let’s drive!”
That’s one argument that doesn’t hold water in my opinion. On the other hand, some people do run efficient stuff like lighting for longer hours because it’s efficient.
The other argument made in these articles is that the money freed up by spending less on energy results in redirection of that extra money toward other goods and services – and those goods and services result in more energy consumption to extract, process, manufacture, transport and operate. I do buy into the merits of this argument whether the end-user is a homeowner, service provider, or manufacturer. I never really bought into the notion that energy efficiency programs result in lower revenues for utilities. Maybe they understand this and hence the rah-rah from utilities for energy efficiency programs. I don’t blame them. By far the main driver of EE is saving money and increasing profits. See “This is Not Tee-Ball“.
Just think how this turns the energy efficiency business and policies on their heads. In “Paying to Lose,” I discussed how utilities have to make their savings goals or they may get hammered by regulators. This, in turn, improves the bottom lines of their customers allowing them to expand. What a racket. Rather than utilities spending money for their customers to use less of their product, they are actually using their CUSTOMERS’ money to sell MORE of their product. And how about “Decoupling Stupid,” that allows utilities to recover revenue “lost” to energy efficiency? They spend their customers’ money to increase sales and meanwhile essentially get reimbursed for the “savings”. Cool!
We have also discussed the underperformance of LEED facilities. In “LEED and the NOT Happenin’ Savings,” I described how LEED buildings weren’t meeting energy performance targets because of lousy commissioning. Well hail to the lousy commissioning agents! They are actually reducing global energy demand and greenhouse gas emissions. Now that end user won’t be able to afford a new vehicle manufactured in Ontario with steel from soot belching plants in China shipped across the Pacific, through the Panama Canal to the Gulf of Mexico and transported by rail to Toronto or someplace – and tires from tariff protected Ohio that are shipped to Canada and back to the California border once installed on the automobile. They also won’t be driving their phantom car. (California won’t allow the car cross state lines because of the embedded energy, so Los Angeleans have to drive to Reno to pick up their car – I just made that up but it is probably true or at least accurate or emblematic, but certainly driving a new car across state lines into the golden state causes cancer and birth defects like everything else in CA does)
And I consider Michaels Energy. Our facility uses practically no energy but in recent years our air travel has gone from virtually zero to hundreds of thousands of passenger miles per year. And from the destination airport, we drive all over the place. Soon for example, we will have about five people zigzagging all over California verifying energy efficiency measures that probably save less than the gasoline burned to prove it. Somebody has to do it!
So go ahead and turn that thermostat up, open the window for some fresh air and click on that 70 inch plasma TV, have a beer and save the planet, Homer.
written by Jeffrey L. Ihnen, P.E., LEED AP
A couple weeks ago, the National Academy of Sciences released a study that summarized the findings of the general public’s perceptions of energy consumption and potential savings from various end-uses in their daily lives. You can check out the curves in the linked article above and take my word for it or risk brain damage reading the thing. To me there are several significant findings, none of which surprise me. These are in no particular order and are only a subset of the findings.
- Finding #1 – When asked open ended questions about ways to save energy, people overwhelmingly selected curtailment measures over efficiency. Shut stuff off. Unplug it. Drive less. Relax and take it easy (love that one but don’t watch a 56 inch plasma while lying on the couch). Conserve energy – so the answer to “What is the single most effective thing you can do to conserve energy?” is conserve energy. I think I would have yelled at them like the Geico drill sergeant.
- Finding #2 – People can reduce energy consumption by 30% “without waiting for new technologies, making major economic sacrifices, or losing a sense of well-being.” Well I don’t know about the “making economic sacrifices” part of this. Viewing average residential end uses of electricity, the easy stuff is lighting and… lighting. I don’t see anything else on there that doesn’t require sacrifice, more work, or spending a lot of money. Lighting accounts for 15% of consumption. Assuming this is all incandescent, replace it all with compact fluorescent for about 2/3 savings, or 10%. We’re one third the way there. Space cooling could be reduced a couple percentage points tops without sacrifice, well, make that 0% without sacrifice. You would have to set your temperature up all the time. Setting the thermostat up is going to save practically nothing because heat transfer due to temperature differences outside versus inside are relatively small. Clothes dryers? You would have to line dry. That is a sacrifice if you ask me. The rest you are either going to be able to do very little or a bunch of nickels and dimes will add up to a few percentage points.The only way to get to 30% is to select efficient equipment when replacement is needed anyway. Throwing away a working furnace and air conditioner with efficient models won’t pay for itself. Spending extra for an efficient model when you need a new one anyway will.
- Finding #3 – Turning off the lights when leaving the room is considered by the general public to produce attractive savings. The paper says there is actually very little savings from this. Hide the kids and maybe the spouse too! I’m not buying this one. The study is 25 years old coincidently.
- Finding #4 – People relate to curtailment, using things less more than using efficient stuff by a margin of 5:1. The top three items are turn off the lights, conserve energy (and call the sergeant), and drive less. If you’ve ever thought of it, efficient vehicles are more efficient, all else equal. The Mini Cooper get’s great mileage, comes with leather seats, manual transmission, and is one of the best resellers on the market.
- Finding #5 – People do not understand which things in their home are energy hogs. They are fairly accurate with light bulbs, stereos, and computers and they actually think laptops use as much as a desktop. My laptop uses about 25W. You can barely read the paper by a 25W compact fluorescent light. What cracks me up is they think the central air conditioner and electric clothes dryer uses only about two or three time more energy than the laptop! You see that huge hulking plug for the dryer? The reality is the dryer uses about 100x more energy.
- Finding #6 – Tuning up your car twice a year saves 100 times as much energy compared to driving 60 mph rather than 70 mph for 60 miles. First, this is misleading. My car wouldn’t even use two gallons in that distance for either speed. Second, who tunes up a car? That’s from the 1970s and earlier when engine control was mechanical. Everything is digitally controlled nowadays. It works or it doesn’t. I haven’t “tuned up” my car in the seven years I’ve owned it and it gets 34 mpg now like it did when it was new. Change air filters and keep the tires a few psi below the maximum shown on the sidewall.
- Finding #7 – People think a truck uses as much energy to move freight as a train does when in reality trucks use about 20 times as much per ton-mile. This magnitude surprises me. What’s the difference? Rolling resistance. Trains have almost none while trucks have a lot. The rest is mainly drag and I’m sure stop and go traffic is a killer for trucks as well. Airplanes use roughly 200 times more than rail. Is buying carbon credits getting expensive to buy off your guilt for taking an airplane? – Become a hobo. And isn’t the checked-bag charge for flying stupid? Shouldn’t people be charged or not based on their weight plus that of all their crap?
- Finding #8 – A virgin glass bottle doesn’t require a whole lot more energy than a recycled one but the public thinks it does. My guess is recycling plastics doesn’t save a lot of energy either. I would also guess recycling paper saves more, somewhere between aluminum and glass or plastic. Not generating garbage for the landfill is as important as the energy savings to me.
One conclusion out of all this is we need to do a better job of informing end users that saving energy doesn’t mean freezing in the dark or taking a shower once a month. I would say these concepts apply at least ten times more for commercial and industrial energy efficiency. There is all kinds of waste in these facilities that do zero to provide better anything.
written by Jeffrey L. Ihnen, P.E., LEED AP
A couple weeks ago I beat up electric automobiles for being overpriced and unpractical due to their short driving ranges and cripplingly long charge times. This week I present a saner approach to substantial energy and emissions reductions.
The electric car is the equivalent of installing renewable energy sources before making conventional systems and technologies as efficient as possible in buildings. Like buildings, we can cost effectively cut personal transportation energy consumption substantially, without sacrificing anything with readily available technologies – rather than pouring gobs of money into technologies that are just five years away from prime time; like they have been for the past 30 years.
Automobiles have gotten much more efficient over the past 20-30 years. However, the miles per gallon have hardly budged. Automobiles have grown continuously larger and more powerful. The modern Honda Civic, for example, is much larger and probably heavier than the “larger” Accord from 30 years ago. The modern version is most likely much more powerful as well.
Public enemy number one on this front is the explosion of the sport utility vehicle, which sort of peaked out just before hurricane Katrina, after which the $3-4 and upward gasoline prices caught peoples’ attention. SUV buyers can be split into two groups: the family haulers and the egocentric. A small group of SUV owners actually need it for regularly poor driving conditions (snow for instance) and/or towing. Maybe we need to make SUV owners pariahs akin to smokers. We’ll have parking lots, ramps, and garages that ban SUVs. Or maybe we put scales where you pay the parking attendant and pay a tonnage penalty for overweight vehicles. Or we could make the entrance to these spaces so small that only a Porsche 911 size car will fit through the gate. Speaking of Porsche and SUVs, the Cayenne was an awful development. How about LEED points for a SUV-free workforce? I’m not so much in favor of these things although the LEED thing is intriguing.
I have been a big advocate of gas-electric hybrids since the beginning, especially for city driving applications where brakes are applied 40 times per mile. My question though is, why do they make so many of them so goofy looking – like the Prius and the Insight. Other models include hybrid versions of the common all-gasoline vehicles like the Civic, Camry, and Cadillac Escalade (which is a joke). How about some sporty smaller cars like the Celica, 240 SX, Prelude, and Integra? Unfortunately these reasonably-priced snappy fun-to-drive models are all defunct.
As a kid, I remember the late 1970s / early 1980s and the cars of the times. When I was first old enough to drive, my older brother was nice enough to lend me his relatively new 1979 Mercury Cougar. Look at that behemoth. It had rear wheel drive and handled like crap. The closest I ever came to an accident was driving this thing down a slushy road when I wandered out of the track. Think of going down a waterslide trying to stop by digging in your fingernails. The next year the thing was downsized by 50%. The gas mileage probably doubled. BTW, I don’t know why they put that woman on there. The car is already hideous enough. The last thing it needs is a supermodel next to it to make it look even worse.
Another blow to petroleum consumption could be dealt with the Diesel engine. All else equal, the Diesel engine is substantially more efficient than the gasoline (Otto) engine. Why? It has a higher compression ratio, which generates a higher combustion temperature. Like steam-driven power plants, efficiency is limited mostly by the highest temperature relatively cheap steel can withstand.
Later, after ditching the Cougar and suffering through three years with a 1983 Ford Mustang, I purchased a 1984 Ford Escort Diesel. The Focus is the descendant of the Escort. In fact, I think the big pitch for the Escort (gas version) was its fuel economy. Most people I’ve talked to regarding the Diesel version are amazed to know there was such a thing. Yes – 48 miles per gallon – 1984 – 27 years ago in car terms. We don’t need rocket science or even some mythical magical battery. We just need somebody with a brain promoting sane solutions to saving personal transportation energy.
Diesels faded from the American auto-makers’ lineups of cars for whatever reason. General Motors somehow took a gasoline engine and turned it into a Diesel engine for its first shot at Diesel engines for light vehicles. This was about 1982. I remember driving my brother-in-law’s Diesel Silverado pickup truck and pulling a trailer. It would literally take ¾ of a mile on flat terrain with no wind to get up to 55 mph. It was the most pathetic excuse for a truck I had ever experienced.
I believe Volkswagen has offered diesel vehicles since way back. To demonstrate how a sane approach to efficient transportation makes the insane look stupid, consider the Diesel versions of the VW Golf, Jetta, and Jetta wagon are rated at about 42 mpg, highway. The tiny tin can lawnmower on wheels, the “Smart Car,” is rated at a pathetic 41 mpg. You don’t even have room for an extra pair of shoes in one of those things. They haul groceries as long as it is limited to Ramen noodles and canned tuna.
So how about these qualities to easily get to 60 mpg with virtually no sacrifice in performance, convenience, or ego:
- Shrink cars back to where they were in the late 1980s with a proportional shrunken engine
- Diesel engines
- Styling that that doesn’t scream “I am a snooty college professor and I am better than you”.
These vehicles would result in SUBSTANTIALLY LESS EMISSIONS than a $40,000, 40 mile per charge ELECTRIC VEHICLE. If you are thinking, “but we can power electric vehicles with windmills”, it doesn’t work that way. Windmills and other renewable energy will always be fully utilized. The incremental increase (or decrease) in electric consumption will come from conventional sources regardless of how you want to pretend you’re charging your batteries with a windmill. In other words, electric cars will be charged with coal, natural gas, or nuclear power.
written by Jeffrey L. Ihnen, P.E., LEED AP
I hate electricity. I love what it allows me to do but I just don’t understand it. I sat through an in-house safety training session on arc flash, which I actually understood – there is a huge burst of energy through a “fault” that melts and actually vaporizes the copper conductor, which expands 7,000 times at Mach 2 and 1 million degrees F (made up numbers but the premise is correct). It’s one heck of an explosion. During a break I was asking our electrical engineers what the difference between a neutral and ground was, the flow of electrons, the consumption of energy. They may have just as well been explaining how to play “Teenage Wasteland” on the synthesizer for The Who (my entire musical career consists of 2 weeks of saxophone lessons in 5th grade and then I broke my arm – game over).
Typically, electrical systems are explained in terms of fluid systems. Voltage equals pressure. Current equals flow, etc. I interviewed one guy with my normal mechanical engineering quiz and he was explaining mechanical systems with electrical ones. I had to laugh. A couple questions downstream I asked my question – without using an electrical analogy, I said!
I’ve done a few electrical things in our house – changed a couple switches to the mechanical twist timer thingies and I replaced one crappy fluorescent fixture with and incandescent fixture – so I can see my clothes in the morning! It’s on for 30 seconds per day. Ok.
My electrician career ended earlier this winter. I was trying to install one of those push button timers – 5, 10, 15, 30 minutes and it turns off – to save 25 kWh/year on my garage lighting. I pull out the instructions. Attach the black wire to the black one, green, red, white, etc. Ok. I pull my switch out of the wall box – I have two blacks and a white – great, just great. I gave it a shot, replaced the thing, went downstairs to throw the breaker, came back up – nothing. Let me try again. Downstairs, upstairs, screw, twist, cram, throw the switch. It works! The timer is clicking through its settings. Before stuffing it all in the box and buttoning it up I go outside to make sure the lights are on, just in case. Hell no! I’m done! I give up. I’m wasting my precious weekend. Downstairs, upstairs…zzzzzt. I was shocked. Somehow I had gone downstairs, gotten sidetracked and didn’t open the breaker. So I almost got barbequed. Never again! I should have taken a hint from the timer switch package. It looked like it had been purchased and returned about a dozen times. At least I’m not the most electrically ignorant guy on the planet.
I didn’t try this to save money. I’m just never home during the week so it was really to save time and hassle, but this is beside the point. The point is, some commercial and industrial end users think, why do a study? Why hire somebody who knows energy efficiency? “We know what needs to be done. Why not just hire a contractor and get it done.” Why not just have Hannibal and his pal Max Cady to drop by to check on my house while I’m out of town?
First, contractors sell stuff. I find it interesting that the vendor’s answer to compressed air system problems is always a new compressor set to operate at just a little higher pressure. Nevermind the capillary tube they have for a header. Could that be a problem? A contractor’s path toward a more efficient heating plant is a new boiler – a conventional non-condensing shiny unit beside the dingy old one that can be tuned to achieve as good or even better efficiency.
Second, on the flip side, if they can’t make money on it, they wouldn’t spot an inferno of cash if it singed their eyebrows. Last week I was getting an explanation of a boiler plant I have never seen. It was from a facility manager who thinks they’re paying excessively for energy in their new 200,000 square foot facility. They want retrocommissioning (RCx). They have condensing boilers running 190F water. Ok. Turn a screw and save $6,000 per year. Not a new boiler. Not new controls.
I’m probably roughing up vendors and contractors a bit excessively. I’m sure some of them understand some things about energy efficiency beyond the sales brochure. I know one such excellent contractor, personally. We on the other hand revel in polar opposite – reducing energy bills in a big way for practically no cost. When a significant capital expense like a new control system is warranted for long-term value, we will recommend it.
Our challenge is our product, a service, is a complete unknown to a facility owner. You buy it and wait to see what happens. Wait a minute. This sounds like buying mutual funds. However, unlike the broker, investment in expert RCx has a very high probability of saving substantial money. You might as well fling darts at the mutual fund tables as opposed to spending money on a mutual fund advisor. Since they ARE the market, their odds of being right are 50% no matter what they say. Conversely, paying a decent RCx guy is like finding money on the ground. Just squat and pick it up, and move on to the next pile.
written by Jeffrey L. Ihnen, P.E., LEED AP← Older posts