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





Oil Slick Musings

1 06 2010

It’s been about a month since I prognosticated and reflected on the BP disaster in the golf.  Let’s see how things have unfolded.  My predictions:

  • Political food fight
  • Underestimated disaster
  • Lack of “what if” on BPs part
  • Where is the outrage?

First, I said politicians would engage in a political food fight while Rome burns.   Sure enough, less than a week after that post, the Senate Energy and Natural Resources Committee assembled a dog and pony show to poke executives of BP, Transocean, and Halliburton with a stick in the eye.  Actually, it was like a dog show alright – a dog fight that is – putting these three executives in a pen and let them go after each other.  Fortunately no one was hurt, physically.

This was purely for show.  They wanted to know how this happened.  What good does that do at this point or certainly at that point a month ago?  These senators probably don’t understand how hot dog cart works, let alone hyper complex deep sea oil drilling and the fluid dynamics involved.  At that early point in the game, the executives probably didn’t even know what exactly happened 5,000 feet below the surface.  They were probably lucky to have time to determine what happened on the rig.

Senator Sessions piles on by describing the spectacle had a lack of candor coming from the corporate execs.  How about this: there was a lack of KNOWLEDGE at that point, you bonehead.  Senator Murkowski said this will affect energy policy going forward.  More on this later.

Second, there would be a tendency to underestimate the enormity of the disaster.  The greatest sin of the federal government is not following their own laws.  After the Valdez disaster, the Oil Pollution Act of 1990 was signed into law to have the federal government equipped and ready for the next disaster.  You can guess what happened as a result of this law: pretty much nothing.  The feds had no fire booms to corral spilled oil and set it afire.  The US went begging around the world for equipment the federal statutes said we were supposed to have on hand.

For the first month, Washington just crossed its fingers and hoped for the best – like shooting the rapids in a canoe.  The worst thing you can do is freeze with the oars out of the water.  That will get you capsized.  Finally, Secretary of the Interior, Ken Salazar, bolts onto the scene declaring the feds will “keep their boot on the neck of BP”, to make sue they “giterdone”.  Now THAT is one thing the feds can do well: put their boot on your neck alright.  What an idiotic thing to say.  He later spews from his oral orifice “if we find out that they’re [BP] not doing what they’re supposed to be doing, we’ll push them out of the way appropriately”.  LOL!  Then what?  We send our fearless congress down to take over?

Senator Nelson of Florida says the administration should “completely take over” the mess.  Colin Powell says the federal government should move in “with decisive force”.   Whadayou talking about man? The government can take over a whacko cult compound somewhere in Texas, but an oil leak? With decisive force?  It seems to me a “decisive force” put the oil rig on the ocean floor.  I think the feds should remove some of their own agencies with decisive force – like the Army Corps of Engineers that has to do an environmental impact study before allowing the construction of berms to protect wetlands from the oil.  How stupid is that?

Lack of “what if” thinking on the part of BP; that water is already far down the stream.  On the flip side of this being such a careless error in design, it will be corrected such that this will never happen again.  Before Valdez, there were hardly any double-hulled tankers.  They are nearly all double-hulled now, with the exception of China, which seems to have trouble keeping lethal quantities of benzene out of its rivers.  Back to my Nuclear Navy experience; Why is the organization so hyper anal about safety?  Aside from the obvious reasons of getting people hurt or killed, if there was a nuclear accident, it would end the program.  Now that is WHAT IF foresight.

Where is the outrage?  It’s starting to grow exponentially.  I believe what held initial outrage down is that the president is Mr. Obama, the guilty private sector company is based overseas, and the great Satan, Halliburton, was actually trying to direct BP away from the course events on the rig that lead to the disaster. The usual villains weren’t present.  If it was Bush, Exxon-Mobil, and Halliburton…hoooo.  Hellfire and brimstone before the thing even sank.  However, this disaster is outliving the politics.  The Democrats are starting to eat their own with Exhibit A, James Carville.

Do I criticize the administration’s performance?  Not so much but they ought to shove federal bureaucrats out of the way and lock them up till this is over; or better yet, maybe lock them up until they are eligible for retirement.  A major problem with the country is people think the government should ride to the rescue for everything that goes wrong.  If we want the government to handle everything well, it will do nothing well.

Another thing that will be a mistake at best and a fiasco at worst is turning Eric Holder loose on a witch hunt in the region before the oil stops flowing.  Who is he going to pursue?  Probably engineers and their supervisors who know more about this particular situation than anyone on planet earth, which incidentally may not be Holder’s home.  This is just what we need – the people who need to spend every waking hour working to find a solution will be harassed by Holder, who has the demonstrated competence of Barney Fife and the subtle charm of a rabid bat.

Unfortunately my next prediction, actually a guarantee, is the feds will of course impose more regulation on the oil industry.  You may be thinking “damn right”.  But wait a minute.  We already had an entire agency (Minerals Management Service) with two missions (1) oversight to prevent disasters like this from happening and (2) to make sure the feds get their cut of the oil revenue.  Well guess what, these guys were going to ballgames and taking gifts on the largess of the companies they are supposed to be regulating.  And while they’re not at the ballgame, they were watching porn at work (not making this up).   So I ask, do we just need more of this, or another agency to look over the agency who’s supposed to be policing all this?  Oh wait, we already have that.  It’s called the Department of Interior.

One solution already has been to split the MMS into two: (1) a fee collecting arm and (2) a safety arm.  Why?  Because collecting money and safety are at odds with one another; it’s a conflict of interest.  Think about that.  What private sector business doesn’t have the same “conflict of interest”?  Go to nearly any manufacturing or labor/machinery intensive facility or even retail and you will see signs of xx days without a work-related injury.  As visitors, we have to even sit through safety training courses prior to going on site at some places.  Aside from caring for workers, injuries are just plain expensive and money losers.  And since when do these vagarious chums care about federal revenue?  What is in it for them?  Are they getting kickbacks?  Does the mafia control MMS?  Safety is number 1 out here.

Like the “solution” to this disaster, we will get laws that punish everyone but the guilty, ala Sarbanes Oxley as a result of Enron.  Nevermind that Enron broke a million laws already on the books.  But like doctors who fill prescriptions, legislators write bills, and a lot of really bad ones, because after all, they have to do something.  Innocent bystanders who follow the rules pay for the sins of the guilty to what end?  In this case everyone who uses transportation or buys things gets hit.  I.e., everyone but the Amish.

What will prevent this particular accident from ever happening again:  (1) BP pays for the cleanup, (2) determine what failed and/or failed to work, and (3) develop a method that is 99.9% assured of killing a well, with five more backups of equal probability of success in series.  This type of disaster will not happen again, if for no other reason, it will take billions out of shareholders’ hides to clean up this colossal mess.

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





Energy Star Black Eye

6 04 2010

For years, beginning in the 1990s through just a few years ago I considered ENERGY STAR® to be fluffy foo foo feel good goo – kind of like eating meringue smothered in corn syrup after chopping wood all day.

Then they introduced the ENERGY STAR rated homes and ENERGY STAR rated commercial buildings.  Both of these seem to be solid “programs”.  ENERGY STAR for commercial buildings is based on energy intensity, which is energy consumption per square foot, climate region, type of facility and a few other things.  To “earn the ENERGY STAR” commercial buildings must be in the 75th percentile of energy efficiency by energy intensity AND buildings must be inspected by a licensed professional engineer to ensure the occupants or owners aren’t cheating by starving the building of fresh air, sufficient lighting, or comfortable temperature and relative humidity conditions.  This is solid.

Then the ENERGY STAR label for appliances started to carry some weight with me, although I have an ENERGY STAR rated dehumidifier that won’t shut off automatically anymore and I otherwise have no idea what about it saves energy.

Unless you’ve been cryogenically frozen like Austin Powers for the past 30 years and were thawed out yesterday, you know the government has been throwing money at ENERGY STAR rated appliances as fast as the presses at the US mint can churn out $100 bills.

Recently some ENERGY STAR warts were exposed.  The famous electric space heater with feather duster and fly strips passed as an air purifier.  This is ironic because electric resistance is the most wasteful source of space heat and a feather duster kicks up dust, just sort of moves it around – not good at air purification.  The other infamous example that passed was the gasoline-powered alarm clock.

For an organization that has eight pages of how and how not to use their brand, including how to use ENERGY STAR properly in a statement, and how to use the logo, this is a major scandal.  The insouciant reaction to this fiasco is unfortunately not surprising to me, as this is the federal government we are talking about.  An ENERGY STAR spokeswoman states the approvals of these bogus products did not pose a problem for consumers because the products never existed. There was “no fraud”, and she said she doubted that many of the 40,000 genuine products with EnergyStar status had been mislabeled.

Come again?  These ridiculous examples get through the “screening” process, but don’t worry, the 44,000 products with the label are all ok.  I think this woman needs to take a statistics class or maybe some taekwondo six sigma courses.

This is another blithe example of no accountability at the federal government.  If something like this happened in the private sector some big heads would roll.

Snooty congress people haul all sorts of people they don’t like in front of them to call the kettle black.  Examples: Mark McGuire, Jose Canseco, Roger Clemens (why their “crime” rises to a federal level is beyond me), Bill Gates, Steve Ballmer and half of Microsoft, automotive executives, and most recently, evil corporations who are going public with the hit they will take to earnings due to the passage of the healthcare bill – reporting which ironically congress made them do in their kneejerk reaction to Enron with the passage of the millstone known as Sarbanes Oxley.

The problem is the government has a horrible record of policing itself.  I went into this in an earlier rant, or maybe it was while I was in a deep sleep one night; the purpose of government is to protect people from being ripped off.  When they start delivering products and services, in this case ratings, who’s going to oversee that?  Look at this ENERGY STAR scandal.  The government didn’t protect us from getting ripped off, but instead was complicit in it.  I don’t know of a single energy efficiency program in the US that is administered by a state agency – except for Wisconsin, which controlled the energy efficiency purse strings for a while and then, you guessed it, they stole the money to fill budget gaps they were too cowardly to fix the right way.  Programs are administered by utilities, consultants, and/or non-profits and overseen by state agencies.  Yes.  This is how things should work.

This guy says to scrap the ENERGY STAR immediately.  I don’t know if I would go that far.  As mentioned above, I think the intent is very positive for consumers.  Instead it should be privatized, turned over to a non-profit or consortium to manage and police.  This is how commercial equipment is rated.  Organizations include the Air-Conditioning, Heating and Refrigeration Institute, and the American Gas Association.

If the ENERGY STAR “program” were turned over to the private sector and a scandal of these proportions broke, you can bet the executives of the organization administering it would be singing to Henry Waxman right now.

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