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[ Buildings and Efficiency ]

Large HVAC Systems


  • [GWh of Electricity Saved:]

    250K
  • [Jobs Impact:]

    • Low
    • Medium
    • High
  • [ Budget Impact: ]

    • Low
    • Medium
    • High
  • [ Conventional Pollutants Reduced: ]

    SO2
    32,790 tons
    NOx
    27,067 tons
    Hg
    .441 tons
    PM
    5,027 tons
  • [ Megatons of GHG Reduced: ]

    239.8

Overview

Air conditioners that cool our offices, stores, schools, and restaurants used 1.1 million GWh of energyand emitted 151.3 megatons of CO2 equivalent in 2010.Adding the electricity and natural gas used by heating and ventilation, commonly provided by the same system, the total energy expenditure used by commercial-scale heating, ventilation, and air conditioning (HVAC) systems topped 2.5 million GWhand accounted for more than 7.5% of U.S. GHG emissions.Americans can vastly reduce the energy we use to stay comfortable during hot summers and cold winters with two strategies: make HVAC systems more efficient and reduce our need to use them.

Analysis

The easiest way to reduce the use of HVAC equipment is by improving a building’s shell— the windows, walls, and insulation. These ideas are covered in the Commercial Building Materials component. In addition to a better-sealed building envelope, some HVAC use could be eliminated with better controls,system maintenance,and duct insulation.7 These projects are relatively low cost, but because of the payback period many buildings have been reluctant to upgrade.These types of projects could reduce energy use by as much as a third,which would lower energy expenditures by $16 billion10 and save 160,000 GWh of energy if implemented in the 5% least efficient buildings.11

While it is difficult and expensive to switch to a different type of HVAC system, like from a boiler to a furnace,12 merely upgrading a system generally improves efficiency by more than 20%.13 Although commercial systems last between 15 and 35 years,14more than 4% of commercial-scale HVAC systems are replaced annually. If each of these systems achieved a 20% efficiency gain,15 businesses would save an aggregate $500 million16 and CO2 emissions from commercial and industrial HVAC would decrease by 3 megatons each year.17 Paired with increasing equipment efficiencies, the cumulative effect would reduce U.S. carbon emissions by 39 megatons,18 the equivalent of emissions from the entire state of Alaska.19

Implementation

Several policies could have an impact on both sides of reducing HVAC energy use – reduced usage and more efficient systems.

Tighten Minimum Efficiency Standards

To help upgrade the efficiency of available HVAC options, DOE should add more categories to its energy efficiency standards program and more frequently update the standards to spur sector innovation and research. As part of existing law, DOE is required to set minimum efficiency standards for certain electrical equipment, including air conditioners, furnaces and boilers.20 For many HVAC components, it took 15 years to update the standard, missing the opportunity to encourage sector change.21 For other HVAC components, such as chillers, there are no national standards at all.22 These standards have saved consumers and businesses $15 billion per year, a return of $650 for every federal dollar spent on the program.23

Create Manufacturer Tax Incentives

To encourage better products in the HVAC equipment market, Congress should direct DOE and IRS to create a manufacturer tax incentive for domestically produced high-efficiency HVAC equipment. HVAC systems and components are purchased infrequently, with equipment lifetime measured in decades.24 Given the long service life of HVAC equipment, it’s important that the marketplace offer highly efficient options at an attainable price. Manufacturer incentives, coupled with high efficiency standards, are a proven cost-effective method of expanding the number of efficient options.25 If results track those of previous residential HVAC efforts, it could double the availability of efficient equipment.

Strengthen and Expand Building Energy Benchmarking

Detailed in the Commercial Building Materials component, building energy benchmarking would provide market transparency and accurately price efficiency upgrades. These efficiency upgrades would in many cases include the HVAC system.

Clear Regulatory Hurdles to Efficiency Bonds

Commercial PACE Bonds,26 covered in the Commercial Lighting component, would lower the cost of financing for efficiency improvements in commercial spaces, including more efficient HVAC systems.

EndNotes
  1. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-1, table 3.1.4, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.1.4.
  2. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-4, Table 3.4.2, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.4.2.
  3. Adding up the totals across all energy types for space heating, space cooling, and ventilation. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-1, Table 3.1.4, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.1.4.
  4. Total emissions from space heating, cooling, and ventilation. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-4, Table 3.4.2, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.4.2; Total US emissions from UN estimates. See also United Nations, Department of Economic and Social Affairs, Statistics Division, “Millennium Development Goals Indicators,” Report, Indicator 7.2, July 2, 2012. Accessed June 18, 2013. Available at: http://mdgs.un.org/unsd/mdg/SeriesDetail.aspx?srid=749&crid=.
  5. United States, Department of Energy, Energy Efficiency and Renewable Energy, “Energy Efficiency Trends in Residential and Commercial Buildings,” Report, p. 28, August 2010. Accessed June 18, 2013. Available at: http://apps1.eere.energy.gov/buildings/publications/pdfs/corporate/building_trends_2010.pdf.
  6. “HVAC: Repair or Replace?,” Buildings, August 25, 2003. Accessed June 18, 2013. Available at: http://www.buildings.com/tabid/3334/ArticleID/1489/Default.aspx.
  7. Shows a 20% increase in efficiency is possible. See United States, Environmental Protection Agency, Energy Star, “Benefits of Duct Sealing,” Web Site, June 17, 2013. Accessed June 18, 2013. Available at: http://www.energystar.gov/index.cfm?c=home_improvement.hm_improvement_ducts_benefits.
  8. Don Gilligan, NAESCO Representative, Interview by Kimble McCraw, Phone Interview, Third Way, September 17, 2012.
  9. “HVAC: Repair or Replace?”
  10. Based on an electricity price of 10.14 cents/kWh, the average spent in 2010. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-3, Table 3.3.2, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.3.2.
  11. Improving the most intensive 5% of commercial space from 420 kBTU/sqft, as was seen to be the most intensive 5% of office space in the NYC benchmarking report. See United States, New York City, Green Buildings and Energy Efficiency, “New York City Local Law 84 Benchmarking Report,” Report, p. 14, August 2012. Accessed June 18, 2013. Available at: http://www.nyc.gov/html/gbee/html/plan/ll84_scores.shtml.
  12. United States, Environmental Protection Agency, Energy Star, “Heating and Cooling,” Report, p. 17, January 2008. Accessed June 18, 2013. Available at: http://www.energystar.gov/index.cfm?c=business.bus_upgrade_manual.
  13. Efficiency improvements calculated from stock to best available. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 5-3, Table 5.3.5, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=5.3.5.
  14. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 5-3, Table 5.3.9, March 2012. Accessed June 18, 2013. http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=5.3.9.
  15. Which is likely, as the oldest, least efficient systems would require replacement soonest.
  16. Total energy expenditures of $179 billion, 40% due to HVAC, 4% converting, gaining 20% in efficiency. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-3, Table 3.3.3, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.3.3.
  17. 1/25th of systems replaced annually, 20% reduction in emissions based on best available equipment efficiency vs average equipment stock, applied uniformly to the 407.2 million metric tons of emissions attributable to commercial HVAC systems.
  18. Analysis based on a proportional decrease in emissions across all fuel types.See Efficiency improvements calculated from stock to best available. See United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 3-4, Table 3.4.2, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=3.4.2.
  19. 39.1 million metric tons saved compared to Alaska’s 2010 emissions of 38.45 million metric tons. See United States, Environmental Protection Agency, State and Local Climate and Energy Program, “State CO2 Emissions from Fossil Fuel Combustion, 1990-2010,” Table, Summer 2011. Accessed June 18, 2013. Available at: http://www.epa.gov/statelocalclimate/resources/state_energyco2inv.html.
  20. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “Standards and Test Procedures,” Web Site, March 4, 2013. Accessed June 18, 2013. Available at: https://www1.eere.energy.gov/buildings/appliance_standards/commercial_products.html.
  21. See United States, Environmental Protection Agency, Energy Star, “Heating and Cooling,” Report, p. 14, January 2008. Accessed June 18, 2013. Available at: http://www.energystar.gov/ia/business/EPA_BUM_CH9_HVAC.pdf?6aa9-bac0.
  22. Ibid., p. 3.
  23. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “Appliance and Equipment Standards Result in Large Energy, Economic, and Environmental Benefits,”Web Site, May 13, 2013. Accessed June 18, 2013. Available at: https://www1.eere.energy.gov/buildings/appliance_standards/.
  24. United States, Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, “2011 Buildings Energy Data Book,” Report, p. 5-3, Table 5.3.9, March 2012. Accessed June 18, 2013. Available at: http://buildingsdatabook.eren.doe.gov/TableView.aspx?table=5.3.9.
  25. Steven Nadel, “Energy Efficiency Tax Incentives in the Context of Tax Reform,” Report, American Council for an Energy-Efficient Economy, p. 11, July 2012. Accessed June 18, 2013. Available at: http://aceee.org/files/pdf/white-paper/energy-efficiency-tax-incentives.pdf.
  26. Katrina Managan and Kristina Klimovich, “Setting the PACE: Financing Commercial Retrofits,” Issue Brief, Institute for Building Efficiency, February 2013, p. 4. Accessed April 18, 2013. Available at: http://www.institutebe.com/clean-energy-finance/PACE-Financing-Commercial-Retrofits.aspx.