Oh Behave

14 06 2011

I swear we were introduced to the food pyramid when I was in grade school but a little web searching gives me just a couple – the one from 1992 and the new and improved one in 2005.

The 1992 edition is shown below.  If you can’t read it, good.

1992 Food Pyramid

The 2005 vertical colorful edition with the stickman and skewers for hands and feet follows.

2005 Food Pyramid

For 2011, the USDA has switched to this brilliant “plate” that looks like a pie chart developed by a group of kindergarteners employed by Microsoft, except I really don’t think anyone would want their brand tied to this thing.

2011 Food Pyramid

The purpose of these things is supposed to improve the health of Americans.  In 1992 the obesity rate in the US was nearly all below 14% for every state in the union.  Only six states had higher rates, Wisconsin being one of them – fried cheese curds and bratwurst.

Due to its success in 2005, they rolled out an improved version.  By this time only four states were as good as Wisconsin was bad thirteen years prior.  Let me try a different angle on that.  By 2005, all but four states had MORE than 20% obesity.  We improved from only six states with more than 14% to all BUT four states ABOVE 20%.

By 2009, the last year for which data are available, only Colorado is below 20%.  Thirty-four states are over 25% and nine of those are over 30%.  It appears that since these brilliant tools rolled out that obesity rates increased from 10-15% to 25-30%.  Progress.  A picture is worth 742 words.  Data are depicted in the nearby US Obesity Rates chart.

This is the brainchild of the USDA, the same organization that floods schools with subsidized fat-bomb food.  Meanwhile, there wages a war against soda and salty snack foods companies but the real culprit is the USDA that peddles this crap.  Surprise!

Despite being bombarded with data, having nutrition labeling on everything, including in some jurisdictions (NYC) on menu items served by mom and pop restaurants, the trend continues.  Why?  Americans on average don’t give a hoot or maybe they just don’t want to change; don’t want to give up anything.  Give me pills, sugar free this and that, fat free this and that, none of which work.  For most people, the solution is simple. Eat less and lower fat and sugar filled crap.  And get more exercise.  What good is a cartoon chart or for that matter, more nutrition information?

And so it will be with energy efficiency.  The smart grid and smart meters are anticipated to be the second coming of Jimmy Carter for energy efficiency.  There’s a problem with this mentality.  People have to give a hoot.  We can bombard people with information at every turn but one has to give a hoot to save energy.

Consumer behavior programs are important to the EE business, but as far as I know this primarily only includes turning stuff off or turning it down.  Nearly every single EE technology, retrofit, replacement, upgrade, and modification requires a strong element of behavioral discipline.  About the only thing I can think of that may lack behavior to avoid snapback (erosion of savings due to behavior change) is a refrigerator and freezer.  I can’t imagine people standing in front of the refrigerator with the door open thinking, “I’m going to look at this stuff in the refrigerator a little while longer because I have an ENERGY STAR® refrigerator now.”

EVERYTHING else can have snapback and erosion of savings over time, if not immediately.  Efficient lights use no energy so leave them on all the time.  I have an efficient furnace now so I’m going to maintain a New Delhi climate in my house.  I have trouble keeping it cool in this building so I’m going to turn the chiller down to 40F and not bother to change it back.  Never mind that chilled water temperature may not even be the problem.

At Michaels’ La Crosse office, we have about three acres of west facing glass that unfortunately does not have good thermal characteristics.  Anybody who knows anything about EE knows solar loads on cooling systems are huge.  Yet our high quality three acre’s worth of roller blinds are only about 30% deployed on average as the solar energy pounds away.  I’ll report back to see if this shaming worked.  If not, I’ll list the names of everyone sitting closest to unprotected windows.  I’ll see if threats work!  No.  I take it back.  I want to isolate the shame effects from the threat effects.  I’ll report on the shame effects in a month and if that doesn’t result in 100% compliance, I’ll do the threat test the following month.

Here is a really twisted perversion of energy efficiency: some technologies often result in more energy consumption, consistently.  Consider occupancy sensors for automatic lighting controls.  The first thing I did on my computer when we moved into our offices downtown was go to wattstopper.com to find information for the sensor on my wall to see how I could neuter it, and I did so immediately.  I set it to be manually switched on and auto off.  My overhead lights are used about 20 minutes per year – sometimes in the winter when I’m gathering up my stuff to go home, and sometimes for meetings with old bats who can’t see.  Otherwise the high pressure sodium streetlight outside is plenty.

I’m hard wired to shut stuff off when I’m not around or using stuff.  However, I’ve been trained by our occupancy sensors in other rooms to leave stuff on.  We even have a sticker on one switch that says Leave the Lights On!  More progress!  I would just as soon fix these with a 34 inch Louisville Slugger.  Occupancy sensors are clearly meant for users who don’t give a hoot.

On top of all this, occupancy sensors punish hard work.  I was told years ago that if you sit absolutely still for the delay period (adjustable from maybe a minute to a half hour), the lights may go out.  Bull.  You have to do a fourth quarter Bucky jump around to keep the lights on.  It isn’t easy working while jumping around.

Jump around, jump around, jump around

Jump up, jump up and get down

Jump! Jump! Jump! Jump! Jump! Jump! Jump! Jump!….  (thank me for seeding this inspiring tune in your head for the rest of the day)

In case you haven’t attended a Wisconsin Badger football game, be sure to check it out.

Programmable thermostats are probably the worst thing that ever happened for energy savings.  We’ve inspected hundreds of these things for program evaluations.  They don’t save energy because in order to save energy you have to give a hoot.  If you give a hoot, a programmable thermostat is a nuisance.  A classic example included a recent verification of an installed programmable stat in a church.  Prior to the installation, they turned their manual stat back for all but a handful of hours needed for occupancy each week.  Post implementation, the heat is on 8-5 every day of the week.  The program implementer should be fined but even so, what was wrong with the manual stat in this case?  And if you’re sitting there, thinking, “I have a programmable thermostat and it is programmed according to my actual schedule, saving energy.”  Really?  Obviously you give a hoot.  Go home and replace it with a manual one and save more.  BTW, people who don’t give a hoot just put these in manual override all the time.  So unlike occupancy sensors, they provide no benefit whatsoever to anyone.

Our industry has an awful lot to do.  This is another reason I am not in favor of in-your-face mandates.  We’ve got to sell people on energy efficiency, or else their obstinance will undo the good deed.  People have to give a hoot and behave!

written by Jeffrey L. Ihnen, P.E., LEED AP

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Choose Solutions, Not Facts

19 04 2011

State and federal budgets are headed for the cliff to varying degrees with few exceptions.  Here in Wisconsin, we’ve had the Battle Royale fight to the death cage match with the repubs on one side and the unions on the other while the dems were hiding out in a witness protection plan.

Meanwhile at the federal level, we are on a dangerous trajectory unseen in my lifetime.  People have whined about the deficit and debt since my adolescence – the Miracle on Ice days against the Soviet Union.  I kept saying, “It’s not a problem.  It’s not a problem.”  Why?  Because the debt as a percentage of our economy was reasonable, and flat but very few people consider this metric – the one that matters most.  They just clobber each other over the head and call each other names and we have Jay Leno fodder like “pay-go”.

However, this all changed since the meltdown Lehman Brothers in the fall of 2008.  The debt as a percentage of our economy really IS becoming a major concern.  We are staring at $1.6 trillion deficits for as far as the eye can see.  Personally, I think the word trillion should be banned because it sounds inconsequential.  How about $1.6 million million, or $1,600 billion?

Do we cut spending, take away grandma’s pharmaceuticals, sell her home, and set her and her senile dog up in a tent under the bridge, or do we fleece “the rich”.  See, I’ve always believed when politicians talk about “the rich” they mean households with incomes of two freshly college-educated people, say an engineer and a nurse or a school teacher and pharmacist.

As a rational person, I did a little Saturday morning research and some pretty simple math to prove my point.  The chart below containing data from the IRS paints a pretty clear and grim picture for those expecting a free ride from “the rich”.  What it shows is total incomes and numbers of returns (households) by income bracket.  The average income of those in the top 1% is $1.2 million and the next 4% the average drops sharply to $220,000.  My analysis goes like this: suppose we just took everything these people made above $100k, $250k, and so on.  Taking everything in excess of $100k from the top 10% of earners is “only” $2.4 trillion – $800 billion more than the deficit.  I.e., if the government confiscated all household income above $100k, we would have an $800 billion surplus.  But almost no one in this country considers $100k to be wealthy.

So let’s move to $250k, which apparently according to the President is the line between the rich and not rich because he’s said ten thousand times he’s not touching the piggy bank of anyone making less than $250k.  Well guess what; if we take everything in excess of $250k, it doesn’t even balance the budget.  Everything!  Of course if we tried this, no one would make more than $250k.  If we took 90%, there would be very little income over $250k and so on.  Lastly, if we take everything in excess of $1 million, you know, stick it to the rich, it has practically a negligible impact on the deficit.  Hello Pesky!  And remember, this is EVERYTHING above $1 million.

I conclude with facts that raising taxes on “the rich” is akin to fixing the weather-stripping on a large commercial building that is hemorrhaging energy waste.

And so it goes for energy savings.  One has to ask themselves, what can I expect for savings to pay for a renovation I want?  Start by considering you can’t save more than the building or a piece of equipment is using.  Sound pretty ridiculously simple?  Some end users could learn from this.

If you are on a buildings and grounds committee, you should know a few basic rules of thumb.  I will use schools as an example here.  New construction costs around $150 per square foot.  The cost of lighting and HVAC for the building is probably 20-30% of that cost with HVAC costing $20-$35 per square foot.  People should consider their own energy costs per square foot, but it’s most likely going to be in the $1-$2 per square foot per year.

So put some numbers together to get a SWAG (scientific wild ass guess) of what your return on investment may be for an HVAC system replacement.  At Michaels we call such a limit of savings or return on investment a bracket or a bracket calculation.  For example, if you are paying $1.50 per square foot per year and a new HVAC system costs $30 per square foot, your best possible return is a 20 year payback – that is if you save ALL the energy being consumed now.  It is safe to say that actual payback is twice that long.  Ditto for adding a variable speed drive to a pump.  One of our engineers may consider a variable speed drive for a pump and I may pull out my calculator and within thirty seconds conclude it’s never going to fly.  The motor uses $750 electricity at most, and installing a drive is going to be at least $2,000.  After screwing around with more detailed data and analysis, it will be a 12 year payback and that’s going nowhere.

Imagine being hired to analyze options for an HVAC replacement, considering several alternative systems.  Wouldn’t you know it! The payback was infinite because the new system would cost more to operate in energy than the 90 year old steam system that provides no ventilation and no air conditioning.  The board is shocked at the price tag and doesn’t want to pay for the study!  They were “misled”.  Wha?  I would call it an introduction to the real world, circa 2011.

This is like going to the optometrist because the patient can’t see very well, thinking they need a $100 pair of glasses.  The doctor does his series of tests and he diagnoses cataracts.  The exam costs $150 and the cataract surgery costs $7,000.  Otherwise, the eyes are fine.  The patient is enraged and refuses to pay for the exam.  The patient still wants the eyeglasses – prescribed by said optometrist!  This is a perfect allegory to a real story.

You may be able to choose among solutions, but you cannot rewrite history, pick your own reality, or defy the arithmetic.

Tidbits

Checking in after my rant No Brazil Syndrome, how many radiation-related deaths have occurred as a result of Fukushima’s damage sustained in March 11’s massive earthquake?  Zero.  Meanwhile, in the same period, probably more than 3,000 Americans have died in car crashes and deaths from the tsunami in Japan alone exceed 13,000.

Like most other things, you (you) have infinitely more control over your well being than that thing poses.  Stay out of the sun or wear strong sunscreen, don’t smoke, keep your BMI within better than recommended limits, skip the red meat, wear your seatbelt/helmet, exercise, don’t break the speed limit, check your cholesterol and blood pressure, get your colonoscopies…

written by Jeffrey L. Ihnen, P.E., LEED AP





Don’t Mess with the Stapler

5 04 2011

We, as an industry, have our work cut out for us in coming years.

Months ago an industrial energy efficiency consortium that puts on training events held a two-day workshop on motors.  Motors!  Talking about the common Swingline stapler for two days would be more interesting.  The efficient motor uses less energy in the amount of the difference in the reciprocals of old minus new.  I.e., (1/eff – 1/eff).  Multiply by nameplate horsepower then by 0.5 (don’t ask, just do it) then by annual hours of use.  Bingo!  There are your savings.  Two days!

There are more complex issues that may not be addressed.  One of these issues is, what is it that makes a motor more efficient?  Tighter windings and closer tolerances – I think.  I don’t care because the impacts are infinitesimally small compared to what end users ought to be doing.  This results in less slip, which means the efficient motor actually runs faster.  Here is the dirty secret:  An efficient motor may be three percent more efficient but as it runs faster on a constant speed fan or pump it would increase shaft power – power transferred to the impeller / fan wheel by 9%.  Increasing the load by 9% but doing it more efficiently by 3% does not save energy.  Quite the opposite, actually.  If one changed sheaves, which isn’t going to happen, or if the equipment is properly controlled by a variable speed drive, it may actually save energy.

On the whole, it is highly possible that efficient motors result in greater energy consumption.

Recently, we were meeting with regulatory staff and the topics of lighting and motors surfaced.  Apparently, the investor owned utilities are clinging to, and concocting ways to hold onto savings for efficient motors and lighting; minimum efficiencies for which thanks to the benevolent federal government are being ratcheted up by fiat.  Clinging like Milton and his beloved stapler.

Give me a break.  If programs are still relying on savings from motors, there is a major problem in Denmark.  How about considering what the motor is turning?  The load on the motor could probably be reduced by 50%, while they are going to “save” 3% with a stupid new motor that runs faster and uses more energy.

I can see what is going to happen.  Some utilities are going to whine to the regulators that all their savings opportunities are going away because the feds have ratcheted up standards.  Regulators should respond with the equivalent of “Gee, that’s really unfortunate.  Since you’ve installed all these motors that use more energy over the years, I think we will raise your savings target by one additional percentage point.”  Ironically, I learned that negotiating tactic from a utility.  “You think the penalty is too harsh?  I’ll add 50%.  Would you like to counter that again?”

Ironically, on the same day as the meeting with the regulatory staffer, I received information I had asked for purposes of evaluating the potential for retro-commissioning of a mid-size high school just over 250,000 square feet.  I had asked for the energy records.  The facility is using at least 50% more electricity than it should and 50% more natural gas than it should – easy.  It is using as much energy off peak as on peak.  The power factor is lousy.  With these symptoms, I bet I can call three top, major energy saving opportunities given the types of systems they have.  I’ll just leave it at that because it’s intellectual property available for a price.

I’ll bet my house that we can reduce their energy consumption by at least 30% with well under a five year payback.  It could be one year or three years, depending on what needs to happen to fix the causes of the waste.

Trust me when I tell you, efficient motors and new lighting will not be part of the 30% solution.

Tidbits

On the nearly useless EE front, see which internet browsers are most efficient.   However, the impact on battery life is worth noting.  If you don’t use the overpriced internet during air travel, kill the browser.

The president says federal vehicles will all use “clean” fuel by 2015.  What does that mean?  One percent of the fuel will come from reconstituted plastic grocery bags recovered from a landfill?   Meanwhile, the federal vehicles excluding military, guzzled 7% more gasoline than the previous year, using 322 million gallons of gasoline.  Congratulations.  I’m always pleased to be told how to live by hypocrites to whom no rules apply.

written by Jeffrey L. Ihnen, P.E., LEED AP





Burnin Down the House

29 03 2011

Some things in life you have to fully commit yourself to or they will end in colossal failure, or immeasurably small success.  When I was a kid I played Evel Knievel by setting up ramps of 2×12 planks and concrete blocks.  I jumped my bike across maybe a five foot “canyon”.  Note, this was before mountain bikes.  Gary Fischer may have been developing his mountain bike in his garage but there was nothing available on the market.  I used a purple girl’s bike, single speed, no shock absorbers, no foot clips, and certainly no helmet.  Why the girl’s bike?  The consequences of failure on a boy’s bike were brutal.  Hitting the ramp at half speed would end in disaster.  I’m sure similar consequences exist for crazy stuff like ski jumping, doing flips on/with anything.  Even when you have an easy play in sports, you have to let it fly or you’re bound to choke.  There are many things you can’t half do.

Fifteen years ago utility deregulation was the rage.  Deregulation has been a boon to consumers in many industries including airlines, and telecommunications.  It’s been brutal to product and service providers that weren’t prepared for the “free market”.  Plenty of airlines went bust and are gone; Eastern, TWA, PanAm, and Braniff to name a few.  It did allow innovative companies like Southwest to enter the market and develop new niches and business models.

Electric utility deregulation had varied results, mostly in different shades of failure.  The darkest shade of failure, pitch black, was probably California where, you guessed it, they hit the ramp at half speed and crashed and burned badly.  They deregulated wholesale prices but capped retail prices to end users.  The fools who approved this are clueless with respect to how markets work.  You have to have price response to the point of use or the system will collapse.  Healthcare anyone?  Consumers kept buying relatively cheap power, while companies like NRG Energy and Enron held all the aces and could charge what they wanted to the utilities.  Result: bankruptcy across the board for the utilities, an Austrian immigrant body builder took over as the Governator in a recall election.

Deregulation didn’t work for electricity for a number of reasons in my opinion.

  • First, the system was built over many decades on a monopolistic, captive consumer, model.  The cost to enter the market as a provider is huge, at maybe a billion dollars for a 500 MW plant.  Smaller plants would be more costly per unit output. …not exactly like starting a coffee joint.
  • It’s instantaneous production and sale, which means producers can charge the same price – so who would build peaking plants, when base load plants can charge the same as plants that are used much less often?
  • The entire economy was built on consistently low-cost power and therefore the “strike price” (say uncle) would be much higher because power is THAT important to doing business.
  • Finally, generators can’t just pick up and move to where demand is highest.  If generators could package their kWh in six packs, cases, or in bulk quantities to distribute to retailers, grocery stores, drug stores, convenience stores, and Amazon.com for consumers to take home and use as needed, deregulation of electricity would work.

Like all these half baked efforts from child stuntmen to electricity deregulation, end users can’t half do an energy efficiency project and expect decent results.  You can’t replace an HVAC system and put in crap for controls or not commission the system and expect results.  You can’t put in a completely different but proven refrigeration system, skip design review by the EE consultant, skip VFDs, skip heat recovery, and skip functional testing of the system and expect more than barely perceptible impacts.  End users may spend 20% extra to implement a new concept but skip the 1-2% needed to make sure it really works and another couple percent on enhancements to capture much of the savings.

This presents a major untapped opportunity with EE programs.  The above refrigeration case was for new construction.  Based on experience in several new construction programs providing services, evaluating programs, and doing retro-commissioning after the fact, I conclude new construction programs generate very little return on program dollar.  The “savings” are relative to essentially an arbitrary baseline.  But what is the market doing all by itself?  Actual attributable savings are relative to what the market, not a consensus reference point developed for something else (energy codes, which aren’t enforced anyway).

We will be doing a new construction market baseline study as part of a major utility program evaluation this summer.  I’ve been in this business long enough to bet a lot of money that most “savings” associated with new construction programs are happening anyway in absence of any program.

So what should programs be doing?  Burn down the house and start over.  Erase 70 years of one bad idea piled on another and start from scratch with a clean slate.  Rather than nibbling around the edges with some stupid occupancy sensors, daylighting sensors, extra insulation, and an efficient chiller (all of which are good but very limited ideas), develop means to completely raze and rebuild (pun intended) building and system designs.

Look, A&E firms are reticent to incorporate changes that make a difference.  Once an A&E team has been selected, they will want to charge exorbitant prices to make significant changes.  To some degree, I don’t blame them.  They charge double in part because of fear of the unknown and in part because they don’t want to do it.  It’s also due to the cheap and crappy market that consumers have been demanding for decades.  They don’t get paid enough to change and programs can’t afford meaningful change either.

Buildings need to be built with systems that are much simpler, low cost, and inherently difficult to dork up.  I have little to no doubt that we can develop a refrigeration and HVAC systems for grocery stores that will reduce energy consumption by about 40% compared to today’s status quo, for both gas and electricity.  The systems would be simpler, with fewer compressors, fewer condensers, fewer fans, less piping and less refrigerant loss.  It would be rugged and difficult to screw up.  If stores were built with this design en masse they would cost no more than the crap that goes in them now.  How?  Because of the simplicity.  Think of it this way.  Look at the power transmission systems built in the 1960s and earlier.  The towers are built as trusses with a bazillion small pieces of iron all bolted or riveted together with a bazillion times 100 fasteners.  What are they made of now?  One giant hunk of steel containing probably no more steel than the old ones.  They are cheaper to build, transport, install, and maintain, and they are probably stronger than the over-designed kludges of the past.  I’m saying something very similar can be done with building design.  

And you can’t develop the concept, hand it over to a contractor and not look at it again until the non-performing results start to come in.  It has to be shepherded through the design/development and commissioned.  THIS is what new construction programs ought to be doing.  But it takes a customer that wants to hit the ramp at full speed, and quit nibbling a little here and a little there with some LED lights and super duper low-e windows and a white roof.

Soon, we will be releasing a white paper that discusses the evolution, or I should say devolution of building design over the past 100 years, and what I am promoting going forward.  Get ready for that.

Tidbits

In an update on A Frivolous Novelty, the all-electric Nissan Leafs are flying off lots at the brisk pace of about 70 per month.  No need to check the decimal point.  That is correct.  About two or three per day, worldwide.  The average Nissan dealer probably sells two Altimas per day, by noon.  Save yours today!

written by Jeffrey L. Ihnen, P.E., LEED AP





Biscuit Discipline

15 03 2011

Like any respectable pets, our dogs Bailey and Atlas have us trained, very well.  I roll out of bed on the weekend, slog downstairs to make a strong mug of coffee, light a fire (in the wood stove), sit in my chair to read the paper and then the dogs position themselves in their kennels with their entitlement look.  They were trained since puppyhood to like being in their kennels so when they kennel up, they get a b-i-s-c-u-i-t.  We have to spell certain things out or use aliases to avoid undesired reactions.  For example, we say “There is a bushy tailed mammal on the bird feeder” lest we get the dogs going bazookas scratching up the wood floor, knocking things over, and ruffling floor rugs into piles.

Everything that has resulted in kenneling in the past is now used to leverage a biscuit for the entitlement dogs.  After taking them outside for a wiz, they get in the kennel for a biscuit.  Don’t get a biscuit?  Whine incessantly.  When I come down the stairs in the morning to put on shoes for work, they get in their kennels.  After their morning and evening meal.  In the kennel.  When I come in from filling the bird feeder.  In the kennel.  Their willpower is staggering.  Crack open a beer on the weekend, WOW.  Get the food out or prepare for the consequences – barks with a pulse wave that will take out a communications system.  It is time to eat, NOW.  After the meal, it’s time for a rawhide – NOW.  The rawhides are like their post-meal cigar.  Lastly, to get them to go outside for a late night wiz before bed, they won’t budge from wherever they’re snoozing unless I break out the ice cream bucket.  You remember faking sleep as a kid?  That’s what they do for the ice cream.  They each get a “bite” of ice cream, which I don’t think touches their digestive system until it lands somewhere in the middle of their small intestine.  They have a pneumatic ingestion system – like a vacuum cleaner.

As I have been in the energy efficiency business for some fifteen years, I am coming to the conclusion that nearly all energy efficiency measures have a strong behavioral component.  Almost nothing escapes the effects of behavior.

In Upside Down Consequence of EE, I expanded on the fact that in many cases, energy efficiency actually increases total energy consumption on a global basis.  There is rebound effect, which refers to consumers using energy efficient equipment much longer than they otherwise would because they perceive the thing in question to use a tiny fraction of energy compared to what it replaced would use.

Energy cost is very much like a tax.  The less people pay into local, state, and federal cash infernos, the more they have to use for themselves.  Hardly anyone other than perhaps some survivors of THE Great Depression, buries their money in the backyard or stuffs it under their mattress.  They either buy stuff, which takes energy to produce and deliver to their home or they may invest it in companies that provide goods and services, both of which consume energy.  As you read this you are probably consuming energy because you are employed by the energy efficiency market; otherwise you might be lying in bed, unemployed or out collecting nuts and berries between unemployment checks.  You’ve got office equipment, facility energy consumption, transportation energy to get to work (if you walked, it takes energy to cook the extra oatmeal).  You are a walking, talking testament to this phenomenon.

Actually, I have no problem with these phenomena.  Smart utilities understand this as well.  They know energy efficiency doesn’t mean less consumption, it means getting more from every BTU and Joule.  It falls in the nebulous regime of “saved or created”; one where we would have consumed XYZ if it weren’t for these programs.

More examples.  One of my gripes about the ban on incandescent lights is that I have certain applications where the incandescent bulb is the best solution.  These are applications where I need light for a few seconds to pick stuff out from the shoe pile, closet, or pantry.  My last incandescent flood light burned out in my main thoroughfare to the garage.  Unlike some other anonymous occupant of my house, I am obsessively habitual about turning stuff off when it is not needed.  Since the CFLs take at least a minute to come up to brightness, they are training me to leave them on because I hate dim more than I hate wasting energy.  So instead of having 86 Watts of lights on for five minutes when I get ready to go out for a run in the morning, I have 39 Watts burning for an hour.  Do the math.  CFLs waste energy.  I don’t care about this “little” difference in consumption.  In the garage, due to the same issue, I have a light on a timer that controls a CFL to burn in the morning and evening darkness.  Rather than maybe a 200 Watts for two minutes, I have 26 Watts for several hours.

In addition to loathing of pathetic light levels, and I’m talking about less than 20% of decent office lighting, I have in the back of my mind the fact that turning lights on and off shortens their life, or more formerly speaking, it increases mortality rates.  On top of that, I know I cannot or will not just throw CFLs in the garbage.  There is all kinds of crap in there, in addition to mercury.  What is in the big whomping base thing?  It isn’t play dough.

I am a breathing and probably irrationally reasoning laboratory for actual energy efficiency impacts.  Impact evaluator, I’m your worst nightmare.

This article discusses more of these issues and as I read it, I thought this would get a lot of blowback from many in our industry.  But I think there is a lot of truth to it, except driving more because a gallon a gasoline goes further.  Driving enjoyment or tolerance and gas mileage are inversely proportional.  Who wants to take a Prius out for a tire-screeching exuberating drive on the winding roads in the beautiful countryside around here?  That’s just wrong.  You need at least something like my tiny Acura which gets a respectable 30 mpg.

Darn.  I didn’t get nearly as far as planned.  I will have to continue this discussion with an extension to nearly every other measure and technology, later.

Click here to see the cartoon version of this week’s Energy Rant.

Tidbits

If you have read this blog, you know I don’t support ramming energy efficiency down the public’s throats.  I was not in favor of the ban on the incandescent bulb, and you can see why above.  (Yes, I can buy a more expensive halogen)  However, I would not move to repeal the law, if that makes any sense.

I have had a great interest in politics and macroeconomics for over twenty years, essentially since college.  There is decent policy, really bad policy and everything in between.  I’ll just say that I’m all in favor of gridlock and government shutdowns because if they aren’t passing laws, they aren’t damaging the country.

As they say, good policy makes for good politics.  A law may be extremely unpopular to some but if it’s good policy, the opposition will melt away over time.  Then there are bills that are just stupid.  They are nothing more than antagonizing the other side; a stick in their eye, and they make for really bad politics.  Which brings me back to the repeal of the incandescent ban.  Take a look at these incredibly stupid comments by Rand Paul.  That will land you on the island of political loons.  Who knows – they may push this through, but it wouldn’t be good politics.  Appealing to just 20% of your most rabid constituents and otherwise only talk radio people or far out bloggers is really moronic and self defeating to one’s overarching objectives.

written by Jeffrey L. Ihnen, P.E., LEED AP





Nicht Tee Kugel, Dos

8 03 2011

This week I am testing an additional medium for the The Energy Rant; the cartoon.  Click here to try it out.  Send email comments with your thoughts regarding this mechanism to me at jli@michaelsenergy.com.

Major barriers to EE for large commercial and industrial end users include;

  • Lack of time
  • Lack of expertise
  • Lack of capital
  • Risk aversion

If you don’t think end users are short on availability, just ask them.  Most end users don’t have time to commit to energy efficiency projects and most of the rest think they don’t have time.  The ones who really don’t have time get seven paid holidays and two-three weeks vacation while the latter group gets eleven paid holidays and six weeks vacation, if you know what I mean.

Most commercial building owner/occupants think of lighting retrofit, adding roof insulation and replacing windows or maybe replacing a boiler they think is 60% efficient.  Lighting may be ok but the rest of this stuff is almost always going to have a negligible impact on energy consumption.  Efficiency to most industrial end users means, just keep it rolling – widgets per shift, less maintenance.  Many times increasing widgets per shift and reducing maintenance is accompanied by energy efficiency, especially when EE is the primary reason to do project.  However, there are bails of cash on fire in many places that are invisible to folks who focus solely on keeping things going.  In other cases, we’ve seen industrial end users think they’re going to meet their 10% reduction goals by turning lights off.  Pssst.  Your lights only consume 4% of your energy bills.

Not enough money.  I’ve investigated commercial real estate from both an owner’s and leaser’s perspective.  The owner makes the tenant pay the utility bills in many/most cases, so there is little incentive for the owner to do anything.  The tenant’s perspective is “I have a three-year lease, this isn’t my building, and I don’t even know if I’ll be here after three years.”  For industrial end-users, capital is very precious and can take force majeure to get.

Then there is a real risk that savings won’t transpire as indicated.  Lighting is about the only measure customer’s can count on with high probability.  This is unfortunate because it doesn’t need to be that way.  It’s just that there are a lot of schlocks who make assumptions like an old boiler is 60% efficient.  As my boss says, if a boiler is really 60% efficient, turn and run as fast as you can because it may be about to blow.  We’ve seen schlock estimates indicating over one therm per square foot savings by adding insulation.  You might achieve these savings if one of the walls on your facility was missing prior to implementation.

Now we arrive at the subject of this week’s rant: efficiency bid programs.  We see a lot of efficiency bid programs, some of which are delivered by clients of ours.  They are typically an alternative to conventional custom efficiency incentive programs provided side by side.  They work like this: develop a project with cost and savings estimates and submit a proposal to the utility for an incentive.  The incentive is always greater than the standard custom efficiency incentive or why bother with the development and bid?  The program is purportedly competitive – i.e., a “free market” for incentives to maximize bang for the program buck.  If it’s competitive, somebody must lose.  This isn’t tee ball.

I cannot see how these programs don’t get slaughtered in a net to gross analysis.  Net savings are actual savings attributable to the program.  Gross savings are actual savings, period.  What’s the difference?  Net includes the effects of the program.  Did the program influence the customer’s decision to move forward with an EE project?

Let’s get back to the barriers now.  Time.  It takes just as much time for a customer and a contractor and/or consultant to develop the project for bid as it does to develop the project for a standard incentive.  And it takes more time to shepherd the thing trough the bid process.  Efficiency bid takes MORE time.  Which leads me to…

Risk.  As mentioned, there is risk the project won’t generate savings because the energy analyst is a schlock.  But for efficiency bid, there is risk, presumably, that there won’t even be an incentive after thousands of dollars are spent developing the project.  Remember, if this program is competitive, somebody loses.  Who is going to spend gobs of time not knowing whether they will get an incentive?  If the standard custom efficiency incentive is the consolation prize and it’s enough for a “go”, then why would the program waste money on a premium efficiency-bid incentive?

True story, last week we considered pursuing one of these bids for an industrial customer for which we had done a study.  We decided against it because (1) we only had a month to get it submitted and in that month you need to get the customer on board and a month is a nanosecond for a capital intensive corporation to allocate (2) extremely scarce capital, and therefore, (3) it was too big a risk for even us, the consultant, to get the whole thing pulled together in a month, at the mercy of the corporate bean counters.  There is far too little upside for our risk of getting something we have almost no control over to happen.

Somebody has to lose if this is competitive.  Most likely only the biggest customers are going to pursue these projects.  A major customer spends a bunch of time to put a bid together and then is told, sorry, you lose.  Now the utility is faced with a colossal PR disaster with a major customer that will raise Cain all the way to PSC’s office.  OR, the customer takes the standard custom incentive as a consolation prize, in which case the whole bid thing was a ruse to get extra program money – a free rider.

These efficiency bid programs probably look great on the surface but if one really understands market barriers and how large end-users allocate and budget capital, it seems like a big free rider program to me.  They take more time, not less.  They add risk rather than decrease risk.  They potentially provide more capital assistance, but at what I see is a disproportional addition of risk.

Tidbits

  • Ameren Missouri says they will pare back EE programs because they are costing shareholders return on investment.   Wow – although I consider it unfortunate, it’s understandable and refreshing to some degree to get straight talk from a utility that actually believes this.  I think a good portion of utilities really think this way but lead on as though they are saving the universe.   Do what it takes to look good to the regulators but with minimal real impact.  Come to think of it, these utilities may be like The Firm.  Once a partner in the EE programs and made aware of the scam, you’re stuck unless you want your car to accidently explode when you leave for home.  BTW, programs can be developed for utilities to make money on EE.  Just call 608.785.1900.
  • Don’t look now, the Chevy Volt has even less than the advertised 40 mile battery range – like about 40% less during cold weather as batteries don’t work well in cold weather.   Not only that, as mentioned in “A Frivolous Novelty” it takes about 5 kW to heat the cabin of the vehicle.  I “mistakenly” thought this was a big deal.  Not really.  At about 0.5 mile/kWh, the battery juice is consumed in less than a half hour.  That’s 50 kWh for 25 miles of driving but only 2.5 kWh for heating.  Who is going to pay $40,000 to be limited to 25 miles between charging?  Raise your hand.  Not all at once, it may make the planet wobble.
  • In one last bit of refreshing honesty, this guy provides a good assessment of plusses and minuses of the ban on the standard incandescent lamp:   Good assessment – far above average for that matter.

written by Jeffrey L. Ihnen, P.E., LEED AP





Playing with Fire

9 11 2010

I was pretty much like every other 12 year old boy.  I liked fire, explosions, and crashes.  If you think I’m crazy, why are movies sometimes beginning to end filled with the same?  Enough said.  Growing up on the farm there were always plenty of things to burn.  One time I asked my dad if I could burn an old cattle feeder that we no longer used.  No problem.

You never see these things anymore but they were wood structures, like a weekend cabin that could withstand an F4 tornado, except it was all wood, nails and fasteners – solid fuel.  So I loaded it up with 40 or 50 paper feed bags – like the big dog food bags.  This probably would have been enough to get it going and burn it down.  But I’m impatient and I want a big fire.  So I grabbed a milk jug and put some diesel fuel in it and thought, eh, what the heck.  I’ll go half and half with gasoline.  I knew gasoline was risky.

So I sprinkled that all over the pile of paper bags and lit a bag (there was a door on the end about waste high).  I watched the flame creep up the paper until it got into the fuel-soaked portion of the bag.  That started to burn as I watched and then, Fahwoom!  A giant fireball blew up and rolled me back, bass over teakettle like when I was kicked one time by a cow – which may explain my dementia.  Fortunately, I knew I was playing with fire and I was prepared to backpedal real fast.  All I got was singed hair on my arms, knuckles, and eyebrows.  I got what I wanted though!  It was a hell of a fire.

As I mentioned a while back, I’m an efficiency freak, and not just for energy.  I also get riled up regarding economic efficiency and how it could impact our industry.  There are many things that apply the brakes and throw sand in the gears of the economy but I’ll get to that later.

This week, I want to discuss the Federal Reserve (Fed) rather than energy efficiency directly because the stakes are enormous and I think everyone should know what is happening.  For years and years (forever) there has been a lot of concern about the nation’s debt.  Why?  I would guess that 99.9% of Americans think we will need to pay it off sooner or later and that’s going to hurt like a tooth extraction with no painkiller.  If only.

Last week beneath all the election buzz the Fed announced it would buy $600 billion in U.S. Treasuries over the next six or nine months.  This is on top of the $1.3 Trillion it’s already purchased.  These numbers, by the way, are staggeringly incomprehensible.  See what a trillion dollars looks like.   I did a little “measurement and verification” on this and it appears to be fairly accurate.  Furthermore, companies in the U.S. have a total of $800 billion cash on hand.  So in the end, we are talking 2.5x companies’ cash on hand.

What is the Fed?  It’s a mysterious central bank with twelve regional banks run by appointed egg heads who are accountable to no one.  Typically, these people have spent their entire lives in academia, politics, think tanks – i.e., a parallel universe.  They set the federal funds rate – the rate central banks charge one another for overnight loans.  When they talk about cutting or raising interest rates, this is it.  The Fed’s mission is supposed to be monetary stability; to avoid extreme fluctuations in inflation, deflation and the exchange rate of the dollar.  If you have an interest bearing money market fund or certificate of deposit, you already know these interest rates are zero.  Controlling the federal funds rate is all they normally do, but they are now going crazy.

Real lending rates (personal/business loans) for all of us track interest/yield on federal Treasury bonds.  For example, the 30-year mortgage tracks in step with the 10 year Treasury bond (I think).  The 15 year mortgage tracks the 5 year Treasury and so on.  “Real” interest rates are set by the marketplace by buying and selling bonds and other debt.

Never think you can’t lose money in bonds.  Bond prices and interest rates move in opposite directions.  For example, a thousand dollar bond may be issued at 5% interest.  Consider the $50 payout fixed.  In this simple example, it would pay $50 per year in return for your cash and risk.  When interest rates go up to 7%, the value of your bond drops because it’s paying you only $50 per year and the bond price will adjust to reflect the current 7%.  The value of the bond would drop to something probably in the $70s.  The opposite would occur if interest rates drop.

It’s all supply and demand.  If there is tremendous demand for bonds, the bond price is high relative to the interest rate.  Enter the Fed.

The nearly $2 trillion in bonds the fed will own will be purchased with freshly printed money.  They are buying U.S. bonds with funny money.  Why?  To “stimulate” the economy.  By sopping up bonds like crazy, they get very low interest rates.  The borrower (U.S. Treasury) wants to sell bonds with the lowest possible yield and as long as they have the Fed throwing gazillions at them, it’s easy.

Many of you have probably refinanced your homes at unheard of rates lately as a result of this Fed activity.  That’s great and you should do it but don’t for a minute think the ball-peen hammer isn’t coming around.

Here is the risk.  The huge gamble the Fed is making is artificially driving down the cost of borrowing to spur the economy so people buy stuff.  They hope the economy will get going and people will pay taxes to lower the deficit/debt and have money to invest in U.S. bonds, rather than the Fed doing it all with funny money.

Injecting all this cash into the world economy and “monetizing our debt” is driving down the dollar.  Supply and demand.  More dollars floating around, more supply, means the value declines.  All you have to do is watch commodity prices for the results.  Comparing to a year ago:  Gasoline up 10%, Gold up 23%, Silver up 42%, Copper up 27%, Corn up 55%, Soybeans up 22%, Beef up 13%, Cotton up 117%.  Do you think this escalation is due to supply/demand (although cotton, used to make the greenback is really up)?  No.  They are up in large part because of a weak dollar.  It’s inflationary for us.  You can easily find information on rising food prices in case your trip to the store doesn’t do it for you.

A weak currency is good for trade to a certain extent.  A week dollar generally means a strong yen, euro, franc, pound, etc.  Strong currency means people from these countries can buy American goods for cheap because they exchange their highly valued currency for a lot of our currency and buy our stuff.  The opposite is true for us.  Imports are expensive, which also puts upward pressure on inflation.  This is great until the people buying our debt start to squeal.  Go back to that thousand dollar Treasury bond.  If that is purchased with Japanese yen and the dollar subsequently drops 20% against the yen, the Japanese guy is stuck with crappy dollars so when he cashes out, he gets 20% fewer yen than he would without the devaluing.  Or he can just keep his crappy dollars and hope for the best.

So what the fed is doing is very dangerous.  They are devaluing the dollar.  The Fed can’t keep printing money to buy bonds.  Sooner or later the debt will need to be financed with real money from real investors seeking what has been the safest investment on the planet.  Continuing to use printed money, the currency will continue to fall until foreign investors that are buying like 40% of our debt give us the middle digit and pull out.  Then what?!!  Trillions of dollars will be lying about.  Everyone has cashed out and the U.S. dollar won’t be worth anything because nobody wants them and there are gazillions of them.  Compounding the problem, interest rates will go sky high because the Treasury can’t find people to buy their debt that melts faster than a Klondike Bar in downtown Bagdad on a summer day.  Inflating our way out of debt is easy but devastating.

The Fed and the government have to stop treating employers and investors like lab rats.  We are not stupid.  We can see the lunacy.  And they wonder why they can’t “create jobs”.

I’ll be out buying gold bullion at $1,400 an ounce to hide in an undisclosed location.  Once it takes a grocery cart full of cash to buy a loaf of bread, I’ll be able to buy the bakery with an ounce of gold.[1]

Epilogue

There are other very negative consequences of buying debt with printed money.  First, it takes a lot of pressure off free wheeling congress to control the deficit.  Second, what is the Fed going to do with all these bonds that pay extremely low yields once interest rates start rising?  They are going to lose a gazillion dollars selling worthless bonds, that is if the economy ever gets going.  Who will take that hit?  Sounds a bit like Fannie and Freddie to me.  Taxpayers will be stuck with that bag.

Since we lab rats won’t behave like they do in a text book, things may not pick up for years and years.  See Japan which has tried this for what, 20 years?  They have enormous debt.  Government tried to stimulate the economy about a dozen times.  People aren’t spending due to deflation.  Stuff just keeps getting cheaper as they sit on their cash.  This with the Fed’s activity has dropped the value of the dollar by 15% against the yen since April of this year.

U.S. officials are being lectured around the world about these reckless policies.  The death spiral of 2008 was all due to ruthless, evil banks, we are told.  Well the Fed has had interest rates very low for a long time, in addition to congress pushing home ownership onto people who can’t afford them.  We had a stock market bubble in the late 1990s.  A commodity bubble just before the 2008 collapse and the housing bubble just popped.  Another commodity bubble is building and I would say the late stock market run-up is building a bubble as well.  Stocks are rising as companies are improving earnings by slashing costs – laying off people.  This won’t last as companies have limited costs to cut.

When will these people look at past policies and the ensuing results and learn from history, rather than their bogus theories?  The economy is not like physics where there are laws like gravity, speed of sound, and conservation of energy.  The economy has a huge macro human element.  The most accurate prediction of what will happen can be found by looking back at history.  I remember as I sat on the sidelines in the late 1990s while people were paying insane prices for stocks.  Valuations were far, far outside historic norms.  But we were in a different era.  Sure, Sonny.  The NASDAQ composite has gained minus 50% since then.

Thinking hyperinflation could never happen here is short sighted and dangerous.  Nobody imagined 9/11, the submersion of New Orleans, or last summer’s unstoppable oil spill.  The Fed didn’t prevent the 1930s from happening and they won’t stop the next one either.  In response to the 1929 stock market crash and recession, Hoover did exactly what gave us 10 years of misery; raised taxes sharply to cut the deficit and Smoot Hawley to cut off trade with the rest of the world.  We are trending toward the same thing all over again.  HELLO!

Lastly, I’ve said before that we need a strong economy and demand for energy to have a strong EE industry.  We’ve done ok through this recession but no one will care about EE when the dollar isn’t worth the paper it’s printed on, or we spend the rest of my career in a grinding contraction like Japan.

Tidbits

Back in March I railed against daylight savings time because it doesn’t save energy.   National Geographic referenced reports saying the same.  But one study claimed there was savings: The Department of Energy.  The hell you say!  It saves precisely 0.02% total energy consumption.  This reminds me of predicting CO2 levels by viewing 500 year old tree rings.  The reported precision is about 1000X greater than they can possibly measure or calculate with confidence.  I wonder how many millions of dollars somebody got to build a model that would support the answer they pulled out of the air to start with.


[1] Do not construe this as investment advice.  Roll your own dice at the casino of the Federal Reserve.

written by Jeffrey L. Ihnen, P.E., LEED AP