"Fantasy" engineering firm

While talking about my "fantasies" I forgot to mention one that has been rolling around in the back of my mind for the past two or three years.  You might find it interesting.

Since I began playing around in the residential energy business I found that there is something really big missing.  I want to try to fill that need.

The current energy efficiency situation is kind of weird because most of the people resources seem to be deployed in the wrong places.  Folks who are really "into" energy efficiency go to college to learn all about it from the engineering point of view (as I did).  Then they go to work for some big architect working on big new commercial buildings (usually office buildings, but not always).  They design to various standards such as LEED and do all sorts of wonderful things.  That is great and as it should be.  But the only residential projects that they work on are new big subdivisions.  Other than that, they don't do it because the big firms who can afford a stable of specialized engineers only work on big projects.

Then there are folks like PG&E that do "free" energy audits for residences.  Basically they come in and find lights that could be replaced (and maybe even replace them for free - with the wrong ones by the way).  They point out old appliances and recommend new ones, and they recommend weather stripping around doors and windows.  This is all well and good, but pretty much useless.  Kind of like spitting in the ocean.  Doesn't really make much impact.

There are also a bunch of big solar companies pushing their products.  They charge between 2 to 4 times what the market rate should be (2 times for cash and 4 times when financed with leases).   These actually make major contributions to the energy use, but at a very expensive rate.   They get the profit, the customer gets the shaft.

The big utility companies put on some really great energy efficiency classes for free.  Great stuff, put on by people who actually do these things in real life.  However, their engineering isn't so great.  Their background is a bit sketchy, and so is their science. One popular guy has a background in leading camping trips into wilderness areas.  No specialized schooling, and no prior experience in energy - but probably a pretty good guide.  He is smart, self taught, and does good things - but is technically pretty weak. Another one that teaches a lot came from a business in residential landscape maintenance.  Another was an HVAC installer (at least this is on topic).  None are engineers, none actually understand the science behind their classes, and most give very incorrect answers to some key questions.  For some reason they actually put on very interesting and useful classes - but not what they could be.

The classes are useful and provide a lot of good information, but I suspect not much of it gets into the field to make changes.  Some does, but not enough.  Most of the teachers are in business doing the things they talk about and therefore aren't particularly interested in helping others create competition.  They give classes because it augments their income and because they are "true believers." I have been unable to engage them outside the classes when I have questions or problems, and I don't find a way to feedback what I am learning to improve the materials.  It is a good effort, but missing A LOT.

There are a few computer programs floating around to perform energy modeling for buildings.  The most popular for homes is pretty easy to use, but gives terrible answers because it is too simplified. It gives answers that are off by 50% to 100%.  It is just a fancy (actually not so fancy) spreadsheet that does the type simple steady-state modeling that I used to do by hand in 1973.  When doing it by hand it is just too difficult to do a dynamic model, and the same applies to spreadsheet models.  That approach can only use average temperatures for the year, a single sun position (with some averages to account for movement), and not much else.  Back in the day it was the only practical way to do the modeling - but that has changed.  Now there are computer programs that do hour-by-hour simulations including thermal mass and all sorts of things like variable occupancy during the day etc.  However, they are all designed to support the "big boys" with the large commercial buildings.  They can be used for smaller buildings, but it takes a lot of work for a small return.  Not only that, but most are in the stage of being "science experiments."  The "engines" are produced by the Government (NREL) represent the best science in the world, but don't include good user interfaces.  They all require a very large upfront effort to figure out how to use them, and the user interfaces contain many very large holes and bugs.  The intent was to develop the science engine and let private industry develop apps to run the engine.  A few companies have done so, but they are VERY expensive.  Far too expensive for small firms to afford - only the big boys get to play with them.  The rest of us have to make do.

Then there are the folks that are in the residential energy business (HCAC and insulation contractors).  They usually got their training from "good old boy" on-the-job instructions, and do most of their designs by "rule of thumb."  They sort of comply with the California energy codes (Title 24), but only sort of.  In addition, Title 24 is only the "worst allowable" situation and it is pretty bad.  Much better results can be achieved for much lower initial and operational costs.  However - to really do what is needed becomes a problem because the better solutions often violate the code.  The reason for this is an entirely different discussion.  It is a mixture of tradition, poor science, lobbying by the manufacturers and just plain sloppiness.

So - now to my fantasy.  I want to set up an engineering office in Davis (because it is convenient to me) dedicated to performing in-depth energy audits and designing of retrofit options that result in NET Zero energy use at something close to an "optimal" cost - that results in less cost than not doing the work.  This could be for new, remodeled, or repaired buildings and systems.  My target structures would be residential or small commercial (the smaller structures that are being ignored by the big boys).

I envision 3-5 engineers, 4-5 engineering students (or new grads) from UCD, some staff and collaboration with professors and utility professionals.  For example, I know of a few questions that could really use some research that might make good senior projects or maybe more.

Customers would be home owners, general contractors, architects, HVAC contractors or anyone else that is interested.  We would do detailed audits, perform detailed energy simulations, and develop detailed specifications for use by  contractors.  We would also monitor work in progress and verify that everything is up to snuff when the work is completed. We would put on classes and other means of teaching other how to do the work and designing.   Hopefully, we will find a way to work with the NREL and California software gurus to correct and streamline the user interfaces so they work better. We would also design solar, swimming pools and other energy related systems.

The end of this will be much better designed projects, much better installations, and reduced costs to the customers and the contractors.    The students would get critical "hands-on" experience in the field and with the software, and we would show the world that this stuff can not only be done, but that it is easy and cost effective.  It turns out that all of the necessary science has been done, the products are readily available and inexpensive, and the codes are generally workable.  The existing ACCA (Air Conditioning Contractors of America) standards, guidelines and best practices as well as ASHRAE standards make sense and are in place. The necessary software is developed and available for free.

All that needs to be done now is to do it.  In answer to the question, "are we there yet?" - the answer is "yes, open the door and enjoy."  I have done some calculations that show that if all the homes and small commercial buildings in California were built and updated appropriately the State could stop using ANY fossil fuels, nuclear and large wind or solar installations.  We have enough renewable resources to meet our needs.  And that could be done at a very large savings to the homeowners and users.  It would put a bunch of money in their pockets to be spent elsewhere, reduce the carbon footprint of the entire state to zero, all by doing simple well known improvements.

I want all of this to be free to the users (whoever they are).  Walk into our offices and you will get the full range of services free of charge.  I am convinced that in order to get past the current "traditional" approach it is going to be necessary to provide the services for free.  I think it will quickly become obvious that it is easy enough that others can do it - and maybe even charge for the services so that it doesn't have to be free forever.  It will also have to come with a guarantee of some sort so that if for example an HVAC design doesn't work, but is installed according to our specifications, then our insurance fixes it - not the HVAC contractor.  Contractors aren't willing to take a chance on new (to them) ideas.

To do all of this will cost a little over $1M a year to pay for the engineers, students, office staff, office, equipment, etc.  So I am looking for a "donor" that would like to do this "experiment" for maybe 4 years to start with.  $1M a year for four years is only four million dollars to do something worthwhile.  It is a lot to you and me, but it isn't a lot to a whole lot of people.  I don't want it to be dependent upon grants or anything like that because that quickly becomes the most expensive, and time consuming, part of the project - hunting for grants.  We don't want to get tangled up in tax regulations, grant applications or anything like that.  It would be a "for profit" organization that happens to lose a lot of money.  I don't know the final form of the business, but I want to stay away from changing what we do to meet tax codes that don't really apply.

So, just in case you run across someone with a few million burning a hole in their pocket, I have some ideas of some really interesting, fun and important things that they could do with it.  I don't know anyone, and haven't really gone out to sell the idea (except like this to friends explaining a dream - who knows, maybe someone will know just the right person).

HVAC system design process

 I just finished a job for a customer that had extremely leaky air conditioner ducts in their attic.  This customer didn't want to change the entire system to a new one, they just wanted us to seal up the ducts so they didn't leak air before the air could be used in the house.  The measured leak rate was 75% of the air was leaking to the outside.  We sealed the supply ducts (air going into the rooms), bringing the entire leak rate to about 9% - quit a reduction.  An interesting thing to consider is that not only did 75% of the heated or cooled air never get to the house, but the fact that the air was being pumped outside meant that the same amount of air was being pumped from the outside into the house.  Thus instead of re-heating already warmed air from in the house, the heater had to heat newly introduced cold outside air.  (Or the other way around in the summer months.)  The overall efficiency was reduced by about 90% assuming that the efficiency of the heating and/or cooling unit is 100%.  While this seems outrageous and "impossible" I find it to be the normal situation - it is just about the same as every other house that I have tested. The vast majority of homes in California are wasting something like 90% of the energy to heat and cool their homes because of poorly installed Heating, Ventilation and Air Conditioning systems. 

After we finished the job of sealing up the ducts, my customer had a change of heart and decided that since I had previously told him that his 4-ton system is too large and that a 2-ton system would work, he asked me to replace the existing packaged unit with a new, smaller one.  Here is my letter in response to that customer.  You might find it interesting and applicable to your home:

We can install a 2-T system, but you are now fighting back upstream!  We can't put a 2-T unit on your house without changing the duct work because it won't give you adequate comfort and economy.  The HVAC and house make up a "system" where all of the parts interact with each other.  If doesn't work to twiddle one part and not the others.  I am concerned that is we just replace the existing unit with a smaller one the system (house plus HVAC) won't work properly and will give you unacceptable results.  A smaller system will cost in the neighborhood of $6,000 without doing anything to make the house match the new mechanical system (which is not a good idea). We are not going to install the insulation until such time as you decide how you want to proceed.

I would be happy to design a system that will work for you, creating an HVAC system that will function properly. However, it is going to be fairly expensive.  I just completed a bid for a very similar project. It came to about $9,000 to replace the ducts, replace the diffusers, and remove and replace the HVAC system.  Yours will probably be similar.

If this ($9,000 to $10,000) is within your budget, I would be happy to create a design and provide you with a proposal.  We can't really "back up" from the work that we have just completed, but we might be able to salvage some of our work - it will depend upon the results of a detailed engineering evaluation.  While we might be able to salvage some of your existing ducts and other parts, we will need to modify them which means that we probably won't save much (or any) money.

We will not be able to replace your "packaged" system with a smaller packaged system because there are no packaged systems on the market that meet your needs.  (Packaged means that the heat pump and/or furnace is in the same package or box as the air handler).  You will need a split system where there is an "outside unit" containing the compressor, and an "inside unit" (most likely in the attic) that contains the heat exchange coil and the air handler.  It is not currently practical to get to a properly sized unit using natural gas for the furnace because they don't make any furnaces that are small enough.  I recommend that you use a heat pump for heating, which actually takes less parts and is approximately the same cost per delivered BTU for heating than natural gas. A heat pump has an additional advantage in that it is electrical and therefore the energy used can be offset with solar production if desired.

We can change your system from a 4-T to a 2-T system.  Actually, we could go to 1.5T and it would probably be better yet.  Consider this as evidence that 1.5 T is adequate:  Your 4-T system apparently "does the job" of keeping the house at a desired temperature.  It was also leaking 3/4 of the energy before getting to the house. Therefore, you were actually delivering cooling equivalent to 1/4 of that size, or 1-T.  Of course you paid for 4-T of cooling and only got 1-T for your money - but it seems to have worked.  This doesn't count the additional cost for cooling (or heating) extra outside air pulled into the house by the leaky ducts. Therefore, even a 1.5T system will be over sized.  I expect it to calculate out at about 2-T, which includes a large margin for "picking up" a cold or hot house and for rare loads such as the highest temps while have a house full of people at a party and things like that.

The problem is that now that we fixed the ducts, they will no longer leak 3/4 of the air - and therefore things might work pretty poorly because of too much air, too much cooling, too much back pressure in the ducts, etc. I have no way of predicting how it will behave because it is incorrect in almost all ways and the tools for doing these designs don't give insight into how an incorrect design will work.  It will probably work, and you will probably get the heat and cooling that you want, but it won't necessarily be quiet, comfortable or efficient. Maybe it will, or maybe not. My bet is that it will be fine, just expensive (not as expensive as before, but more expensive than necessary).

Let me describe the design process a little bit so you can visualize what is going on. I'll briefly walk you through the design process and maybe you'll see how the system interacts. (Note: a ton (T) of energy is the amount of energy required to melt a ton of ice.  It is about 12,000 BTU and about 3.5 kWhr. A kWhr is a 1000 Watts for an hour and currently costs about $0.16 at the baseline rate and about $0.24 for the average PG&E customer because of the rate tiers in use by PG&E.)

1) The first step is to determine the energy loads necessary to keep each room at the desired temperatures.  This means we need to know the final configuration with regard to insulation, windows, electric lights, number of people in the room and other heat producing equipment.  We also need to know what "desired temperatures" means.  It generally means 72F in winter and 76F in summer.  You might not want to keep the rooms at those temperatures, but the system should be able to do so just in case you or someone else wants the rooms at that temperature.   This is a room-by-room evaluation that includes average hourly weather conditions throughout the year; including energy through the windows, walls, ceiling and floor (heating from the sun, etc).

The outcome of this is the peak heating and cooling load for each room, as well as the total for the entire house. A "perfect" system would provide this much heat/cool energy to each room at the peak times, which would then add up to the total for the house (and therefore the HVAC system).  Unfortunately that would require a zoned system that could control temps in each room independently, but that is not practical in a house with a central AC system.  There are ways to do it, but they are expensive.

2) We then determine what air temperatures should be put into the rooms to achieve the desired effect.  This is a bit tricky and is a subject of some debate.  I have come to the conclusion that the cooling air should be 59F in Davis, and between 98 - 103F for heat.  There are a lot of reasons for my choices, but I don't have time to explain them here.  I can explain them to you at some later time if you are interested.

3) Given the amount of energy needed to cool and/or heat each room, and the temperature of the air entering the room, we need to calculate the required air flow into each room in the units of CFM (cubic feet per minute).   Adding these up gives us the total air flow required from the air handler (the HVAC blower or fan that moves the air throughout the house).

4) Given the air flow requirements, the shape of each room, and the location of the air supply diffusers (supplying air to the room), we can select the air diffusers. The correct diffuser ensures that air in the room is well mixed to avoid hot and cold spots or drafts, and is directed so that it doesn't impact occupants creating drafts and uncomfortable air movement.  Each room (or section of big rooms) requires specific diffuser design and selection to allow correct air flow to achieve the goals of proper heating/cooling and comfort.

Once the diffusers are selected, the rest of the system design follows to ensure that the air into the rooms is correct.   In your house this is the beginning of the problems.  It is almost certain that none of your diffusers are designed to achieve any of these goals.  We might accidentally be able to use some of them, but generally that is not an expected outcome.  Without getting these close to correct the system will not function very well. Therefore, we will likely need to change the diffusers.

5) At this point in the design process we will know the amount of air required by the air handler and will know the amount of BTU's that the compressor needs to be able to deliver at the design outside temperature extremes (28F in winter, 105F in summer) with the design loads (lights, people, cooking, heat producing appliances, etc).  This sizes the system.  I am guessing at 2-T, but that is only a guess.  In addition, these units are only made in 1/2T increments, so you can't get exact.  I tend to round up to the next size.  The PG&E classes that I have been taking suggest rounding down because there are so many other "rounding ups" that happen.  They are probably correct, I haven't the nerve to do that yet. I am unaware of any solid science that points one way or the other.

6) At this point it is possible to select a system and the ducts - they need to be selected together in a "circular" fashion.  I do a tentative (preliminary) duct layout that shows where the ducts will be run, how they will be routed, and where "Y's" , elbows and things are to be located.  Based upon that, I can determine the anticipated pressure drop from the air handler to the diffuser and back through the return ducts (the static pressure drop of the piping system).  That results in a selection of duct sizes for each section of the duct work that gives the correct pressure drop and air flow to make each diffuser work properly.  At that point I know how the ducts will be run and how big they have to be.

7) Then comes to time to select the system.  This is a bit of a problem because there are NO systems sold that meet the needs of a house in Davis.  The air handler has to be sized to efficiently move the needed amount of air, at the correct pressure, with a minimum amount of fan energy.  Step 6 and 7 go around for a while to find a combination of parts that more or less optimizes the various needs.   The air flow from the air handler is not arbitrary, it is based upon the needs of the rooms.  The fancy "high efficiency" units with multi-speed fans won't work because changing speeds changes how the diffusers work, which is only correct for one speed.  The design requires just one fan speed to get air to move properly in the room, any other speed will be uncomfortable and won't work properly. This means that a properly designed system is much less expensive than one that is sold as high efficiency because of multi-speed fans.  Unfortunately we will be using the same air handler and set of diffusers for both heating and cooling applications.  They work differently in these two modes so we will attempt to find a "happy medium" that gets close to correct for both modes of operation.  Neither will be optimal.

8) Now that the air flow is known, and the desired air temperatures are known, the compressor and the heat transfer coil can be selected.  We need to select a compressor unit that provides enough heat (or cool) to change the air flow over the coils to the correct temperature.  For example, if the house is set to 72 degrees, and the entering (supply) air is 100F, then the compressor needs to provide enough energy to raise the temperature of the air from the return (at 72F) to the diffuser temperature of 100F.  Since we know the air volume though the air handler, that tells us the size of the compressor.   A similar situation exists during cooling where we bring 76F house air down to 59F supply air.  However, we need to be careful to cool it too much because that will cause water to condense from the air, unnecessarily using a lot of additional energy and drying the air in the house, which is already too dry in Davis during the summer months.

We are then finished!!! (Finally).  Then all we have to do is purchase the parts and install the system.

The point of this rather long and detailed discussion is to show that you can't just select a compressor and hope it will work.  It has to be matched to the air handler and coil.  And you can't just select and air handler and coil, they have to be matched to the ducts.  And you can't just select any old ducts, they have to be selected to match the diffusers.  And you can't just select diffusers, they have to be matched to the room. And the room depends upon the insulation, orientation and use.   There is a very specific flow in the design process - you get bad results when you just change something in the middle of it.

HVAC systems are very seldom designed, they are constructed based upon "rules of thumb" that don't work and have never worked. There are very detailed design standards and specifications, but they are seldom used in the field.  The Rules of Thumb might have been close before the late 60's at a time when houses weren't insulated, were very drafty, and had single pane windows.  Maybe the rules of thumb worked, but generally they didn't.  The main rule was to put in a large enough system to provide enough energy to overcome whatever was going on.   That got the house warm and cool, but not necessarily comfortable and certainly not efficiently.

Once we have gone though all of this effort, the system will not work as desired!  The reason is that since there is only one air handler, and only one thermostat, the only room that will be the desired temperature will be the one with the thermostat.  All of the others will be slightly above or below the desired temperatures, and that will change as the day goes along and the sun moves.  However, the air flow into each room will be correct to mix the air and avoid drafts.  The only solution to adjusting the temperature of one of the other rooms is to adjust the thermostat, which of course messes up all of the other rooms. That is unavoidable with this kind of system.  My personal solution is to close the doors on the rooms I don't use, and open those on the rooms that I do use.  This keeps the used rooms about the same.  I could also just open all of the doors and it leaves all rooms about the same.  With a well insulated "typical" house this isn't much of a problem. In addition, in Davis the system will be oversized in the heating mode and the diffusers will tend to cause slight drafts (but at least the drafts will be warm and comfortable).

I would hate to just stab a 2-T unit on your house without first doing a design for the entire house to select correct diffusers, ducts, duct runs, etc to get a house that works properly.  There is a very big risk that whatever we choose will not work without fixing the other things.  Unfortunately, the work that we just did to seal up the ducts is going to make it very difficult to deal with since they are all glued together.  Last week they were not connected together so they were easy to fiddle with.  Not now!  We will likely be forced into removing most or all of the existing ducts and replacing them with new, properly sized and well insulated, ones. They will work much better than what is there at this time, so it is actually a good thing to do.

Solar leases

 I have been having a difficult time explaining why lease agreements for solar installations are extremely expensive and maybe not such a great idea.  There seems to be a great desire to install solar, save some money, make some green power and not have to spend anything to do it.  That all makes sense, and is very easy to do these days.  However, doing so through the current lease agreements has no advantages, and is extremely expensive when compared to other readily available options.  For this reason I created a short (one page) comparison of three options.  I have included that paper here in the hopes that it will help people make better decisions, keeping more of the money for themselves instead of handing it over to a leasing company.  The example that I used to illustrate the point comes from one of my customer's installation.  It represents a typical home in the Sacramento Valley using PG&E as the utility.  All of the values shown are dependent upon the specific situation (size, location, utility rates, energy net metering arrangements, leasing rates, etc) so can't be used to evaluate any specific proposed system.  However, the overall trends and relative advantages of various funding options are likely to be similar for most situations.  This is just an example of a local system installed today intended to identify the issues that need to be investigated before making a decision to install an expensive photovoltaic solar system.

Assumptions:

- The solar system consists of 25 photovoltaic panels producing enough power to offset the entire annual electrical bill for a “medium” usage household with an average electrical bill of $148 per month. The cost of electricity is assumed to increase by 5.15% a year (the average retail increase between 1980 and 2013)

- The $16,030 cost of the system will include a 30% tax rebate.  The value of the installed system is assumed to be at least equal to the net after tax cost.  Studies have shown that the additional costs are more than recouped when the house is sold, often yielding an increased property value of over three times to cost of the solar system.   

- For a cash purchase, there are no “expenses” involved in the purchase of the solar system, it is merely moving one type of investment (e.g., a bank account) to another (a solar system).  For a loan purchase it is an investment funded entirely from reduced energy costs.     

- Solar panels have been shown to last at least 40 years with little or no degradation in performance after a small “burn-in” reduction experienced during the first two years.  There is insufficient data to speculate on how much longer they might actually perform.  They typically carry a 25 year warranty.  

- For example, my solar system cost me $32,000 after the tax rebate and incentives.  Prior to purchasing the solar system, the money was invested in income producing bonds, yielding an income of about $1,600 a year. By using that investment capital to purchase the solar system, it reduced my annual electrical bill by $2,880 (an effective income to me).  After seven years my savings are now $3,850 a year. The annual savings (or “income”) will continue to increase rapidly over time. In three more years it will be saving me $4800 a year instead of the $1600 I would have been making with my bond investment.  I have already made almost as much in savings as the entire cost of the system.  I still own the system, it still has the same value, and it continues to provide very large savings every year.  

- The lease agreement option is priced to be equal to the first year’s energy bill and remain constant plus an annual inflation rate for the 20 year duration of the lease.  The graph assumes a 3% annual inflation rate.  At the end of the lease, the leasing company owns the system.  The lease can then either be renegotiated, or the system can be removed and returned to the leasing company.  It is assumed that the lease will be renegotiated at similar terms and therefore will continue in effect.  

Unintended consequences

This month's Scientific American (April 2015) has an interesting short article called "Artificial Sweeteners Get a Gut Check."  The article discusses some animal studies relating to what happens when they eat artificial sweeteners instead of sugar.  The available evidence, and expectations, are that people react similarly.

The bottom line is pretty simple, for a large group of the population artificial sweeteners cause obesity and many other problems, including diabetes as well as liver and heart disease. 

The reasons for this are rather complicated, but I think the following description is close to being correct in the overview.  These sweeteners change the microbe population in the gut, removing those that are good at breaking down sugar and replacing them with bacteria that is good at turning the other things into "energy" for the body.  The impact is that more energy gets to the blood stream than would have normally been the case.  These bacteria also change the way that the body deals with this extra energy, increasing the bodies efficiency for creating fat, causing the body to store it away as more fat.  As if that weren't enough, the changed bacteria population causes changes in behavior, causing the animal to eat more. 

The impact is that the more you try to lose weight by cutting out sugar, then easier it is to put on fat and crave food more, making you fight to limit calorie intake, which screws up your overall diet.  The combination of too much fat and poor diet, and apparently some direct impacts of the new gut population increase the list of illnesses plus others. 

One of the tricky things about this is that while all people get the change in gut populations, it is only those who are genetically pre-disposed to putting on weight that get the double wammy of storing more fat.  Those who don't have those genes apparently can withstand the change in bacteria without adding on more pounds. 

This all lines up with my observations of the years.   I reject the idea that the obesity epidemic is just because people eat too much and eat to rich.  Of course that is the case for some people, but there are an awful lot of people who are careful with their diet, eat balanced meals, and eat a heck of a lot less than a lot of the skinny folks - but they still keep getting fatter. It seems obvious to me that something else is going on - probably something related to the chemicals that we are exposed to.  Artificial sweeteners fall exactly into the area that could be a big cause of the problem.  In fact, this article makes it pretty clear that not only might this be a big part of the problem, it almost certainly is.

The good thing is that it can be reversed.  All you need to do is kill off all of the gut bacteria and then get a new crop of bacteria, hopefully from someone who doesn't eat these chemicals.  Sounds a bit extreme, I wonder if it is going to become common practice. Without that it appears that the "bad" bacteria can stay dominate for many years, causing havoc the entire time.

Now I am wondering about "lite" beer.  Many people drink lite beer to limit their calorie intake.  My observation is that isn't what happens.  What I see happen is that people drink beer partly because they like it, but mostly to get a buzz (for the effects of the alcohol).  While lite beer only has 1/2 the calories because it only has half the alcohol, my observation is that people just go ahead and drink twice as much!  Same amount of alcohol, but twice the whatever else they are drinking.  Personally, I avoid lite beer as much as possible partly because it tastes nasty, and partly because I have to drink too much of it.  I am MUCH happier drinking beer that I enjoy the taste of, and limit my alcohol intake by limiting the volume of liquid I drink.  I wonder what other "unintended consequences" will show up with whatever processes are done to make lite beer instead of plain old fashioned "heavy" beer.

Solar questions

While enjoying a cup of coffee with some friends this morning I found myself being peppered with questions concerning installing photovoltaic (PV) solar on homes.  It seemed that everyone had a similar set of questions, and after spending most of an hour answering them it was suggested that I try to summarize them on my blog - so that is the purpose of this blog.  However, each of the topics that I cover are much more complex and have more details than I can cover here.  Please just consider this a "primer" based upon some basic considerations.  If you decide to install a solar system you will may want to dive a little deeper into some of the topics.

- Don't solarize your inefficiencies.  The first thing to consider when considering a PV solar system is reducing your energy footprint before sizing the solar system.  The reasons for this are two-fold.  The first and most obvious is that solar panels are expensive.  The more the load associated with inefficiencies is reduced, the fewer panels that are needed.  Right now solar panels are around $800 to $1000 each, installed.  Making a change such as switching to LED lighting might be able to save a panel, freeing up $1000 for the lights.  Heating systems and building insulation are two other areas that almost always are extremely inefficient, but can readily be improved - reducing the total energy use of the home and thus reducing the required investment in solar panels.  The second reason to improve efficiencies is that doing so almost always dramatically improves the comfort of the home.  You get reduced costs while getting better performance and more comfort by fixing inefficiencies before sizing the solar system.

- How much does a solar system cost?  The cost of a PV solar system depends upon how much electricity you use.  I live in Sacramento with mild winters, hot summers and six to seven months of sunny summer days every year. The systems that I have installed to achieve "net zero" (zero electrical use averaged of a year) range in size from 14 to 30 panels.  For example, my house in the country is a 1986,  2200 square foot "ranch style" house with a well, swimming pool, hot tub, electric heat and cooling (using a heat pump), electric dryer.  We use propane for water heating and the kitchen stove.  I have 30 panels, which brings us very close to net zero. On the other hand, I have a "town" friend that has an 1970ish, 1800 square foot house that uses 14 solar panels for the same outcome.  The difference is in my swimming pool, electrically heated hot tub, water well and probably some lifestyle differences.  I find that twenty 260 watt panels is a good starting point for talking, it is enough for a "normal" house with normal use preferences. 

Assuming $800 a panel installed cost ($3.10 a watt, which is about what I charge), a 20 panel array will cost about $16,000.  However, I have been researching installed costs in the area and find that others in the area charge from $4.50 to $6.50 a watt ($23,400 to $33,800) or more, sometimes significantly more.  Obviously there is a large difference in installed costs using similar equipment.  I recommend checking this out carefully. 

There is currently a Federal tax credit of 30% for solar installations (set to expire at the end of 2016).  For my costs, that results in a total installed cost of about $11,200. The exact cost depends upon a number of variables such as roofing, difficulty of connecting to the electrical service, mounting and racking details, and other items.  Based upon these considerations, a 20 panel system should have an after-tax cost of between about $11,000 to $24,000 - depending upon installation specifics and the installer costs.

- What kind of financing is available?   This is a rapidly changing topic.  Cash is obviously an option.  Another great option might be a standard loan, or a second mortgage.  These options are likely to incur the least overall cost.  The problem with loans is that they come with financing fees and might have relatively high interest rates. 

There are no-up-front fee leases that provide a certain amount of power each year for a fixed monthly or annual fee.  The leasing company owns the solar system and therefore receive the tax credits.  They also own any additional energy that the array makes and sell it back to the utility company.  At the end of the lease period (typically 15 years), they own the array and you can either reapply for the lease, pay for the array, or have the array removed (which may or may not create an additional fee).  While the leasing approach seems attractive because there are no up-front costs, the leasing company takes care of any repairs (which are unusual and under warranty by the equipment suppliers), and the cost of the lease is less than the cost of power (and doesn't increase as the cost of electricity increases) it is expensive.  The down side is that these companies often base their rates on the high end of the installed costs, and the lease is equivalent to very high interest rates (on the order of 25% or higher).  A personal loan, or a second mortgage, have the same benefits of no (or very low) upfront costs, immediate price reductions, and "locked in" payments - but these are usually 7 to 10 year loans, and at the end of that period there is no longer an electrical bill or lease payments.  I highly advise being very careful about choosing a lease option, it is easy but can be extremely expensive.

A third financing option is through PACE funding.  Basically, this involves obtaining a loan that is attached to your property tax and is paid off as part of the annual property tax payment.  The main benefits of this type of financing is that it is extremely easy to qualify for, and doesn't negatively impact most people's credit ratings (because it becomes a "tax" and not a "loan").  The down side is that while there are no upfront finance charges, there are a lot of upfront fees paid for by both the homeowner and the solar installer.  In addition, the interest rates are typically equal to or greater than commercially available loans of similar size and duration.  Another upside is that since it is paid for as a tax, it might be deductible from income taxes. I would recommend that this financing option be investigated closely to make sure that the benefits outweigh the costs.

- How do solar systems save money? Residential solar systems in California enjoy an arrangement with the electrical utility that is called "net metering."  This means that even though you have solar, you are still using utility supplied electricity.  When you use more than you make (such as at night or on a cloudy day), the meter turns in the normal direction measuring how much power you are using.  When you make more power than you use, then the meter goes the other direction - subtracting from the amount that you used.  At the end of the year (at the "true up" time), you get a bill for the difference over the past year.  If you used more than you made, you get a bill for the difference.  If you made more than you use, you get a credit or cash for the extra power (but at wholesale rates rather than retail rates). 

Perhaps the biggest value is that the solar production changes the rates being charged by moving you into a lower energy rate tier.  In California, residential electricity is sold on a tiered basis where the first tier has a lower rate, the second tier has a higher rate and so on. As the month progresses the charge per kilowatt hour (kwhr) of power increases as you move from tier to tier.  Solar systems offset the amount of power used, so that it is all in the first tier rates.  Therefore, even if the solar might not be sized to achieve "net zero" it can significantly decrease energy costs by preventing payment at the higher tier rates.  In California, the current tier costs are $0.164, $0.187, $0.275 and $0.335 per kwhr for an average rate of about $0.25/kwhr.  Just moving to the lower tier not only saves the amount of electricity used, but can cut the rate of electricity by as much as 70% - depending upon energy use.

Another major advantage of solar is that it effectively caps the utility rate at the cost of the loan or investment rather than continually escalating with the utility rates.  In PG&E territory, the 30 year annual rate increase is greater than 5% a year.  When this is included in the "pay back" calculations for a solar investment, it often results in a "payback" time of seven years or less.  This means that if you do nothing, within seven years or less you will spend the same as you will if you install solar. At that point the solar can be considered to be "free."  Anything beyond that is free power.  If you decided to expend the loan period to ten years or more, the annual payments will be much lower than without the solar. 

- How long do solar systems last? There is no way to determine ahead of time how long a specific system will last, but history has some interesting examples for comparison.  I discussed this issue with the group at Sandia National Laboratories (a facility that does extensive short and long term testing on solar equipment).  They told me that they aren't sure about the expected lifetime of solar panels because they only have 45 years of history. Their expectation that newer solar panels should be expected to last longer than that.  They typically come with a ten year warranty on the panels and a 25 year warranty on the panel output.  The 25 year warranty is for less than 1% degradation in output per year, meaning that a 260 watt panel will still produce at least 195 watts after 25 years of service.  Sandia's history indicates that a more reasonable expectation is a 1% decrease for each of the first three years, and then a level output for the remainder of their live.  Therefore, a 260 panel is likely to produce 257 watts after a year, 255 watts after the second year and 252 watts after the third year and beyond.  A very reasonable design option is to size the system based upon 252 watts rather than 260 watts to ensure that the power will be sufficient - this amount of oversizing a 20 panel array means an extra 1/2 of a panel. 

The second major component that might need to be replaced over time is the inverter that converts the DC power from the array to AC power for the house.  For a 20 panel array (5kW) the inverter will cost about $2200 for a single large inverter, or $3200 for 20 microinverters.  The warranty for the $2200 units are typically about ten years, at which point it is often necessary to purchase a new inverter.  The warranty on microinverters is typically 25 years at which point it might be necessary to replace one or two inverters.  There are reasons beyond replacement costs and warranties to consider using microinverters that will be discussed in the next section of this discussion.

- How do you select components?  The selection of components is a definite "it depends..." 

I highly recommend microinverters, one small inverter mounted directly under each panel.  They are about a third more expensive, but have many redeeming values.  The first advantage has to do with array efficiency.  Using a single inverter requires up to ten solar panels (or more) to be wired in series - like batteries in a flashlight.  Each panel adds to the voltage of the string. 

Since each panel operates at about 35 volts, a string of ten will have about 350 volts.  Often they are connected to produce up to 600 volts.  The high voltages decrease wire size requirements, but increase safety concerns because 600 volts DC is extremely lethal, and there is no way to turn off this power in the event of a daytime fire or other emergency except to cover them with an opaque material (very large blanket).  On the other hand, using individual microinverters limits the dc voltage to 35 volts and the AC voltage to 240 volts (normal residential power).  The AC portion of the power can easily be turned off at the main breaker panel.

In addition to enhanced safety, microinverters do a much better job of controlling the panels typically yielding as much as 5-10% greater output than a single inverter.  If any portion of a panel in a string get shaded, then the output of the entire string is decreased.  This is a major issue because even a small shade patch (as small as 4 inches in diameter) can decrease the output of the entire string by well over 50% (sometimes as much as 90%)!  Shade is NOT compatible with string inverters.  However, even if and entire panel gets shaded with microinverters, the output of the array is only decreased by the amount of the shaded array, in this case being 1 out of 20 or 5%.  Microinverters often add a very significant effectiveness bonus over string inverters.

Solar panels have become a commodity and are all pretty similar across the board.  Some claim to be extra efficient, but they also tend to be extra expensive.  The more streamlined and "pretty" styles tend to be more expensive both for the panel and the racking hardware. There is a strong tendency that "invisible," "seamless," "integrated into the roof" also mean "more expensive."  These are issues of taste rather than engineering values.  The same goes for translucent panels that would make a nice shade structure over a patio or other place.  Some panels look very nice and clean from underneath, but they tend to be two to three times as expensive as the "normal" panels. 

- How much solar access is required to make a solar array "worthwhile?" Solar access refers to orientation, tilt angle and shading for a site.  An important thing to keep in mind is that sun is only effective when it is less than about 45 degrees from the perpendicular of the array.  This has some surprising results.  For example an array facing due south is only effective from about 9:00 am to 3:00 pm - even though it appears to be in the sunlight for many more hours than this.  The problem has to do with the reflectivity of the glass surface, and the decreasing size of the effective array size.  The only part that counts very much is the 90 degrees from the orientation of the array meaning that the south facing direction is not very important. 

The "best" orientation for an array in the Sacramento Valley is facing south with a tilt angle of about 25 degrees.  If the array cannot be faced due south, the production will be reduced by up to 10% if facing east or west instead of south.  For a 20 panel array, this can be made up by adding an additional 2 panels.  Back in the time when solar panels cost upward to $20 a watt instead of today's $1 a watt, that made a big difference in price.  However, that difference is now not nearly as important (expensive) and therefore many more roofs get adequate sun exposure.

The best tilt angle is about 25 degrees, but even laying flat on a horizontal surface only decreases the annual harvest by about 5%.  It really makes very little difference. 

While this is true for stationary arrays, the numbers are different for tracking arrays.  Those can increase the overall harvest by about 25% above a stationary array.  While this seems large, it can be matched by a 25% increase in the number of panels (five extra panels in the case of our 20 panel system).  At $800 a panel, this increases the cost by $4000 to match the output of a 20 panel tracking array.  However, solar trackers typically cost a lot more than that, and because they have mechanical components, they require maintenance.  Cost, convenience and lack of maintenance usually mean that a tracking system is not worth the investment for small systems.

The next big issue with solar access has to do with shading, which can be significant and costly.  A small amount of shading can be accommodated by using microinverters so that only the shaded parts are effected.  However, careful shade measurements and calculations are necessary if shading is possible, especially if the shading extends into the months of March through October.  Shading in the winter months is not as important because the sun is dimmer, there are more cloudy months, and usually the tilt angle is optimize for summer months and is very poor during the winter for a grid tied system.  (Off grid systems might turn this optimization upside down to maximize the power production during the winter months at the expense of the summer months.)

- How do I get solar hot water?  Back in the days when PV solar was extremely expensive, hydronic solar hot water panels (those containing a liquid that is heated in the sun) were the only affordable option.  However, they are expensive, complex and prone to leaks and degradation of various sorts.  With the new lower price of PV it is my opinion that it is much better, easier and cheaper to just add enough PV solar to heat the amount of water needed, and use well insulated, standard electric hot water heaters.  They are very inexpensive, highly dependable, and require little or no maintenance.

It is my opinion is much better than going "on demand" hot water because those devices are very expensive, and have other problems.  In order to get "instant" hot water, I recommend using multiple small electric hot water heaters located close to the demand.  If they the hot water tanks are well insulated, they have very low standby loses.  I installed a propane instant demand hot water heater for my house.  It still has long pipe runs so takes a lot of time (and water) to get hot water to the faucet.  In addition, it won't turn on with low flow faucets (such as low flow shower heads).  The water heater requires a significant flow of water to turn on the heater (to keep the heater from overheating).  The only way that I can accomplish this is to turn on the sink hot water as well as the shower hot water.  That gives me a warm shower, but wastes all of that hot water down the sink drain!  I will soon remove that device and install two smaller electric hot water heaters, one for the bathroom end of the house and the other for the kitchen end.

   

Run on the Banks

I was talking to my brother about the "state of the world" and had an epiphany that we are in the midst of something closely akin to a run on the banks.  Several times in our history banks ran out of money during panicked mass withdrawals of funds not because there is anything inherently wrong with the banks, but because people lost confidence that their money was safe.  It is well known that banks do not maintain enough cash to cover the total amount of deposits - they invest depositor's cash to make a profit.  That means that if all of the depositors withdraw their savings at the same time, many will end up short when the reserves run out.  A few, or even a lot, of depositors can safely withdraw the cash, but if people start to panic thinking that it they wait they will lose their money - then all hell breaks loose.  The fear that a bank may become insolvent turns into a self-fulling prophecy whereby the fear turns into a panicked withdrawal by the depositors, that in turn causes an otherwise healthy bank to enter into instant bankruptcy - with the result of large scale negative impacts on the depositors, the community and if the event spreads in a chain of events to other banks, it can cause the collapse of the banking system and the overall economy. This has happened several times in history, including being one of the primary causes of the "Great Depression."  It is also a large part of the reason for the sudden financial collapse during the "Great Recession" starting in 2007.

My epiphany has to do with the current "mad scramble" for natural resources.  One obvious example includes the amazing increase in oil and natural gas production in North America (including Mexico, the United States and Canada).  The United States has recently become the worlds largest producer of oil and natural gas.  That's amazing.  Even more amazing is what we are doing with it - we are sending it overseas to our "competitors," selling it at rock-bottom prices.  We are madly drilling, digging and refining with the apparent goal of removing all of our accessible supplies as quickly as possible.  At the same time, the other producing countries are buying up our resources at record low prices because we have created such a glut on the market as to crash the prices to less than half of what they were just a year ago. Those countries see very clearly that there is no hurry - if they conserve their resources we will eventually be forced into buying from them at very high prices, and they will maintain their "energy security."  We (the United States) are in an apparently insane process of destroying our reserves in a rush to create very large short terms profits for a few international and European corporations. 

It appears that oil companies are panicked that they will be blocked from using up the free natural resources provided to them by the citizens of North America.  They appear to be operating from the fear that if they don't get it all right now it won't be available in the future.  Fracking is an example of a short term, high profit technique that is likely to be shut down soon because of the known wide-spread environmental destruction that it causes.  As soon as regulations prohibit the practice, then those resources will no longer be easily and cheaply available, so the best option for gas and oil producers (they are actually miners, not producers - they don't produce anything) is to get as much as possible as quickly as possible.  This rush has the feeling of being a rush on the deposits very simlar to a run on the banks.  The fact that fracking results in hundreds of millions of gallons of water tainted with toxic chemicals being pumped into under ground aquifers at a time of great climate uncertainty when those bodies of ground water may be critical for our survival has no impact on the desire to get as much as possible before the deposits run out.


Another example that I have talked about in my blogs has to do with the sudden rush to drill new water wells in the Sacramento Valley.  We are in what appears to be a protracted drought related to climate change.  The drought is causing a rapid decline in the quantify of ground water contained in the ancient aquifers of the valley.  Currently, there are no restrictions, regulations, monitoring or charges for water pumped from the aquifers by agricultural wells in the Valley.  Surface water from snow packs in the mountains is regulated and billed, but not underground water - it is freely available to anyone with the money to drill wells are run the pumps.  There seems to be a great fear that the aquifers will soon fail naturally or become unavailable because of new regulations, meaning that the "bank" will run dry.  This fear seems to be fueling a great run on the banks of our underground water - everyone attempting to get their part before it runs out.  What are they doing with the water?  They are growing things - mainly things like almonds that are almost all sold in Asia.  We are mining our water to make non-nonessential crops that are shipped to our competition so that they (the Asian countries that purchase the almonds) can reserve their precious water supplies to be used for growing essential crops and other uses. California is often called "the breadbasket of the world" - meaning that we are using up our natural resources to ship food around the world, which is the same as shipping our water around the world in the form of food.  Maybe there is a better way.

In both of these examples (mining for hydrocarbons and mining for water) the basic resource is free (or almost free), all that needs to be done is get it.  These are two examples of important resources that are part of "the commons" - those important natural resources that are not owned by anyone, but which are needed by everyone.  Water, air, good weather, buried resources, fish, ocean resources, species diversity, and all the other elements of "the environment" are part of these commons.  There appears to be a growing fear that the resources in the commons are soon to be depleted, restricted, regulated or otherwise made unavailable as a "free" resource to anyone who can get them - and this fear is fueling a run on the resources similar to a run on the banks.

In the 1920's, prior to the Great Depression, there was a steady and troubling series of small bank failures across the United States (and around much of the"western world").  These failures were small, locally disruptive, but not troublesome enough to be noticeable by most American's.  In fact it was a time of great prosperity and fun.  It was the "Roaring Twenties" in America and the "Golden Age Twenties" in Europe.  However, there was also a slow uptick in the failure rates of banks that sharply increased starting in early 1929, followed by a great increase in stock values, culminating in the crash of the market in the Black Tuesday crash of October 1929.  This was followed in short order by a worldwide run on the banks as people panicked that if they didn't get their money out in time they would get nothing (which turned out to be true once the panic was underway).  We all know the results of the panic.

The crazy and inexplicable run on many of our essential natural resources (particularly in petroleum products, water and ocean fisheries) has the feel of a panic that the resources will be lost by those who don't grab first.  I have been confused by what is happening because it makes absolutely no sense from the prospective of sustainability, of fairness, of planning for the future, of husbanding resources, of directing short and long term investments for humanity and the environment, or anything else that I can think of.  However, it makes PERFECT sense if it is driven by a panic similar in cause to a run on the banks.  From that perspective, it all makes perfectly good sense - it is a reasonable response to the fear that the freely available resources in "the commons" will soon be lost if they are not grabbed right now. 

  

Open letter to Governor Brown, State of California

I wrote the following letter to California's Governor following his State of the State message outlining many things, including energy improvement and rooftop solar programs.  While I was pleased to hear him set these goals, I am concerned that there are a few major roadblocks that could prevent achieving these goals.  Having no place else to turn, I decided to write to the Governor in the hopes that I might be a slight influence toward making the necessary changes.  You might find some of these words helpful in understanding what is preventing obvious advances from being made.

 ______________

 

Honorable Governor Brown,

As an energy engineer, general contractor and owner of a small company in the home energy efficiency improvement business I want to applaud and thank you for several of your comments during your “State of the State” message. Your targets of doubling the efficiency of existing buildings and of expanding the installation of rooftop solar and microgrids appear to be the quickest, and cheapest, avenue for dramatically reducing our global carbon footprint.  Bringing existing homes to “net zero” through a combination of efficiency improvements and rooftop solar can potentially save enough energy to allow the State to meet its energy needs without using fossil fuels or the expansion of environmentally destructive large scale solar or wind “farms.”  Once homes and most businesses achieve net zero energy use, California will have sufficient energy resources from existing or readily achievable “renewable” energy sources such as bio-fuels made from waste products and other carbon free sources such as hydroelectric and geothermal to eliminate our need for energy sources that create Green House Gases. 

There are a couple of major roadblocks to achieving your goals that need to be rectified to clear the paths to the desired solutions.  As an engineer/contractor doing business in both “rooftop” solar and building energy efficiency improvements I find the following issues to be significant impediments to reaching the goals that you outlined in your message.

1) Rooftop Solar –

There are four significant problems that keep getting in the way of higher solar use. These are:

Utility company posturing – The large utilities, such as PG&E, keep making it sound like net metered, distributed, solar is unfair to the poor people who can’t afford it.  Many studies have shown conclusively that this is not true.  Their negative ads and posturing inhibits many people from buying in because they don’t want to be thought of as unfairly taking advantage of others.

            Solutions:

- Promote the fact that roof top solar decreases the price of electricity for all utility            customers by decreasing the cost of overhead, facilities and production required to produce power from fossil fuel sources.  Roof top solar is not just good for the fat cats, it helps everyone by reducing electricity costs.

- Promote the fact that net metering customers are helping the environment, helping to reduce the carbon footprint, and are reducing the overall electrical costs for all customers.  

Cost-benefit uncertainty – The utility companies keep lobbying to add a surcharge or otherwise increase costs for net metered customers.   This creates an uncertainty concerning the future benefits from solar installations.  Many people are unwilling to invest in the face of this uncertainty.

           

            Solutions:

- Pass laws that prevent the utilities from adding a surcharge to net metering customers.

- Remove the limitation whereby net metering customers are prevented from installing solar systems providing more than 110% of their previous year’s electrical use. Many customers are interested in adding additional solar for future use such as purchasing electric cars or by changing from gas appliances to electric ones, but are prevented from doing so because of this restriction.

Availability of money to finance solar installations - Homeowners and owners of small businesses are finding it difficult to obtain affordable funding that does not impact their credit rating and line of credit. 

            Solution:

- Create a government financed revolving fund to provide low interest, or no-interest loans collateralized by the solar system itself.  The loans should be of sufficient duration to reduce the annual payments to 20% or less than the current cost of electrical power.

Fear of not being able to recoup the solar investment when selling a building. – Many potential customers are afraid that they will not be able to recoup the cost of their solar investment when they sell their home or property because they feel that the home appraisal will not clearly separate the selling price of the home from the cost of the solar investment.

            Solutions:

- Provide a means to identify the loan on the solar system as a separate loan that is not part of the value of the property.  This will allow property assessments to be separated from the solar investment and not become mixed into the overall value of the property. 

The original solar owner will have benefited from reduced energy costs during their ownership. The remaining portion of the solar loan should pass on to the new buyer with minimal fees, without impacting the appraised value of the building.  In situations where the original homeowner self-funded the solar system, there should be an easy affordable way for the new owner to finance the value of the solar system.

The current practice of companies providing solar through extremely expensive leases (with interest rates often well over 25%), or high priced loans underwritten by counties and municipalities is supporting financial investment companies rather than the customer or the common good.  This approach of depending upon private funding to cover the cost of investments does not adequately or fairly address the energy problems in the State.  We need affordable sources of low, or zero, emission energy - not well financed and funded investment corporations.

Instead of subsidizing high cost installations that carry extremely high interest rates, the State should be lending low interest money for the installation of vast amounts of distributed, net-metered, electrical generation (“roof-top solar”).  While it is true that the loan companies are saving customers some money, they are overpricing that service and taking large amounts of money out of the economy in the form of government sponsored tax rebates, expensive solar installations, and high interest rate loans in the form of lease agreements.  These profits should go to the State and the building owner, not to large investment corporations.

2) Increased efficiency of buildings –

Increased efficiency of buildings, especially residential buildings, is easily achieved because of the huge inefficiencies that are built into these structures, even when complying with the “strict” requirements of the Title 24 energy code. 

The solution to improving the energy efficiency of small buildings such as residential properties and small businesses is pretty straightforward.  There are three major problems with the vast majority of homes and small businesses.  These problems include:

Poor insulation – There is usually very little, poorly installed, insulation in the ceiling spaces.

Solution: Require adequate insulation for new construction and appropriate remodel projects, including a requirement to inspect to ensure proper insulation installation.  Provide incentives in the form of no-interest loans and cash rebates for improving insulation.

Excessive Air Infiltration – There is a significant energy loss from buildings because of the lack of adequate air sealing between the ceiling space and the occupied zones. 

Solution: Provide incentives in the form of no-interest loans for improving buildings that have been tested to have too much air infiltration (are too leaky).  Rebates or other incentives for these types of projects should be prorated value upon the difference between pre-retrofit leakage rates versus after-retrofit leakage measurements (“test-in, test-out”).

Improperly sized HVAC systems – In most residential and small business installations the heating and air conditioning systems are not matched to the needs of the building.  They are usually oversized and operate at less than 50% (often much less) of their advertised efficiency because of the mis-match between the loads and the size of the unit.  

Solutions:  Require new HVAC systems to be designed and installed to match the needs of the building.  Provide incentives in the form of no-interest loans to retrofit poorly designed and installed HVAC systems.

Ensure that the HVAC system is properly design and installed requires that the following tasks be completed:

- The building is modeled to determine the thermal loads for each conditioned room or space and for the building as a whole. 

- The HVAC system components are selected to provide heating or cooling in each room or space within a small fraction of the design values (for example within +-10% of the design).  Any recognized engineering approach to doing the design calculations should be allowable, but submitted for review by the building department.  The total design approach must ensure that loads for the building are approximately equal to the total energy loads as determined by using the appropriate version of CBECC (California Building Energy Code Compliance) software. 

There are many tools for doing load calculations.  The design engineer needs to be free to use whichever approach they believe meets that needs of the building.  However, to ensure that the overall HVAC sizing calculations comply with the appropriate Title 24 energy requirements, they need to be compared with the accepted standard practice in California. If the sum of the individual room loads equals the CBECC standard for the total building, the method used to calculate the individual loads is approximately correct.

- The measured energy provided to each conditioned space as determined by supply air temperatures and air volume measurements must match the design loads to within a small variation.

- The size of heating or cooling equipment should not be more than 0.5 tons (12,000 BTU) larger than the calculated loads. (The reason for the 0.5 ton bracket is to allow equipment manufacturers to only have to provide a reasonable number of size options.)

- Bypass ducts returning supply air directly back to the return (bypassing the building’s conditioned spaces) should not be allowed.

The current version of Title 24 requires that a flawed SEER level criterion be used: Title 24 requires minimum SEER and HSPF ratings for HVAC systems.  However, the test protocol for determining these values does not match the needs of California’s relatively hot, dry climate.  The SEER ratings envision hot, humid climates that require dehumidification to achieve comfort within the buildings.  Dehumidifying air in California wastes vast amounts of energy as “latent heat,” and results in unhealthy dry air in the building.  For a properly designed system in California, the air flows, and supply air temperatures are very different from what is measured by the SEER ratings. 

Because manufactures are required to pass the SEER testing protocol, they only design systems to meet the energy requirements meeting the SEER testing protocol for humid climates.  Therefore, almost all residential HVAC systems sold in the United States are designed to not work properly in California – creating an efficiency penalty of 50% or more while making it extremely difficult to purchase equipment that meets the load profiles of small buildings in the California climate.

Solutions: There are three possible solutions for this problem. 

      (1) Convince HVAC manufacturers to produce certified systems that match the design       requirements for California’s climate,

      (2) provide for the prediction of system SEER and HSPF from systems designed        using “mix-and-match” components (heating unit, heat pump, fans, heat transfer coils         and air handler), or

      (3) create protocols for testing installed systems that the flexibility to mix-and-match   components.

Availability of funds to finance HVAC retrofits or improvements: Replacing or improving a working HVAC system in existing buildings is an expensive endeavor.  In most cases, building owners are unwilling to make that kind of investment until the existing system fails and needs to be replaced.  Based on an average service life of over 15 years for this type of equipment, updating and replacing existing equipment will take a couple of decades.  In order to achieve the goals of doubling the energy efficiency of existing buildings in the near future it is necessary to implement the necessary changes at a cost that can be covered by the value of the avoided energy. 

Solutions: Provide low or no interest loans to cover the cost of improving or retrofitting HVAC systems at a cost that is significantly less than the cost of energy without the retrofit.  The energy savings potentials and associated cost savings potentials should be predicted by performing before-and-after comparisons of total building energy use using the CBECC tools. 

3) Poorly structured energy incentives:

The current approach to providing investment incentives on “big ticket” energy improvements through tax reductions is highly regressive and does not work for fixed income home owners.  For example, a high income homeowner can now be receive tax incentives of up to 60% of the cost of a roof top solar installation by financing the cost of the improvement through a PACE program.  They get a 30% rebate out of their income taxes, and since the PACE financing gets treated as “property tax” they can deduct those payments from their taxable income, achieving an additional 30-38% savings for a total incentive of well over 60% financed by tax dollars and only 40% financed by them, with no upfront out-of-pocket investment.  On the other hand, a fixed income home owner (such as a baby boomer that has paid off their home and is living on social security and their investments) does not have enough income to generate income taxes sufficient to benefit from the government tax incentives.

Therefore, the current practices of providing government incentives in the form of tax savings is only beneficial to those high income people who could afford the improvements without the incentives.  The people who really need the incentives to make energy efficiency improvements affordable cannot get the government incentives and therefore can’t implement the energy savings improvements that are required to meet your goals.

The use of tax savings as the means of providing government funded incentives eliminates a vast number of homeowners that would otherwise be extremely willing to make the investments to reduce their energy costs.  Included in this group of people are the coming flood of “baby boomers” that are beginning to reach retirement age.  The vast numbers of these people have small or non-existent company or union sponsored retirement plans.  They have planned for the retirement years by reducing expenses by paying off their homes, setting aside small personal investments such as IRA or 401K plans, and hoping for continued Social Security payments.  They have little, or no, taxable income – therefore they cannot make use of the income tax based incentives.  However, they are very interested in reducing their costs of energy and are looking for inflation protection that can be achieved by installing solar systems to eliminate their electricity bills.   

The best way to achieve a fair, and useful, government sponsored incentive program is to provide direct re-imbursement for energy efficiency investments rather than tax breaks for upper income people.  In order to eliminate the need for large up-front investments, the government can provide low or no interest loans to cover the cost of the investment.  The use of direct cash re-imbursements instead of tax breaks costs the tax payers the same (not receiving taxes costs taxpayers the same as receiving taxes and giving them back as incentives), but has a dramatically different impact on the ability of low or fixed income homeowners to be able to afford the investments.  The government should provide funds for the loans rather than relying upon private investors in order to reduce costs to the homeowner.  For example, the current PACE programs charge 6-10% in initial fees, and then charge interest rates on the order of 8%.  This creates very expensive loans that are only affordable because the payments can be deducted from income taxes as property tax payments.  There should be very low fees (1% or less) and very low interest (comparable with savings account interest returns) loans to fund energy efficiency improvements.

Taxes are once again subsidizing corporations to make very expensive loans to those people who have high enough incomes to benefit from the tax incentives.  The government should make the loans at zero or very small cost if the goal of increased efficiency in all homes is to be achieved.  Energy improvement investments for homeowners is not the place to be subsidizing loan companies that charge extremely high interest for extremely low risk loans.   

SUMMARY:

The goals of doubling the energy efficiency of existing residential and small business buildings can be achieved with existing technology at an annual cost that is much less than the cost of not making the changes.  However, there is a problem with funding the initial investment.  Very low interest loans are the most likely way to provide the necessary funding for the up-front investments required for equipment and labor.  Ideally, the money will be in the form of loans and cash rebates rather than tax reductions. Revolving funds created for this purpose are paid back and become available for use for improving other buildings.  Providing tax reduction incentives works for people who have enough income to enjoy the tax breaks and have enough cash to fund the work, but are not useful for low income people.  However, there are many building owners that have neither – they need help in getting the necessary upfront funding that will immediately lower their energy costs. 

Once a building has been upgraded to minimize energy use, then it is often quite affordable to add sufficient solar generation to bring the building to “net zero” use making as much energy over the period of a year as it uses.  Net-zero energy use should be the minimum goal for all residential and small business buildings in California.   

Respectively,

Charles Hoes

President, Hoes Engineering, Inc.