2016 NYAE Q2 Recap: Smart Buildings & Grid Modernization

New York Advanced Energy’s Stakeholder Breakfast brought together major players in energy optimization and building efficiency, from utility providers to building owners, to identify the gaps in the industry and find actionable solutions. The New York Advanced Energy Stakeholder Breakfast featured Charlie Marino, NY Director of Energy Services, AKF Group; Eric Davis, ConEdison Demand Response; Diana Sweeney, Chief Operation Officer, Energy Watch; Jim McDonald, Director of Environmental Impact, PowerSecure; William Vasquez, General Manager, 3 Bryant Park, Callahan Capital Properties; and H.G. Chissell, Founder and CEO, Advanced Energy Group. Panelists spoke about the evolving Con Edison Demand Response Programs, the strategic importance of optimizing energy supply and demand-side strategies and the overall value of greater coordination among stakeholders. With all of these major stakeholders at the table, there was a marked interest in developing viable cost saving, and revenue generating energy projects supported by the right type of utility incentives programs.

According to the panelists, there exist a number of macro-level trends affecting the energy industry, such as New York Governor Cuomo’s 50 by 2030 target, which assumes a tripling of energy efficiency directly affecting Con Edison’s strategies. Eric Davis of Con Edison emphasized New York City Mayor Bill De Blasio’s 80 by 2050 target is very ambitious and requires greater focus on energy efficiency and energy flexibility in buildings. More importantly, Davis stressed the issue of rising electric demand due growing heating and cooling loads, and the necessity of cleaning upstream generation. Mr. Davis underscored the importance of policy on the macro level as well as nodal needs and opportunities, like the peak demand issues at Brownsville substations serving Brooklyn/Queens.

Pertinent to the conversation of reducing emissions in accordance with EPA and local pollution targets, Director of Environmental Impact, Jim McDonald from PowerSecure talked about the company’s new Tier 4 certified clean power system and ability to retrofit certain existing diesel generators for continued participation in well-paying demand response programs. McDonald emphasized sustainability, supporting long-term ecological balances, and resiliency. In an effort to meet REV and other NYC goals set by NYC Mayor De Blasio, Jim McDonald spoke about the benefits of ultra clean diesel as a way to meet compliance standards. He stressed the importance of diesel as a better fuel economy option because of the increased efficiency compared to other fuel types, and the ability to acts as a zero-emission spinning reserve resource that can produce kWs - MWs within seconds of startup. Finally, McDonald asserted that taking into consideration line losses and utility portfolios, on-site ultra clean Diesel generation can lead to anywhere between a 10-40% reduction in GHG emissions over traditional centralized power distribution systems.

Jim McDonald and Charlie Marino

A major part of the conversation was geared towards cost-savings, capital investment and incentives, all of which are integral in making buildings more efficient. Charlie Marino, Director of Energy Services for AKF Group opened with a demand management program case study of 1211 Avenue of Americas’ chiller plant upgrade. As a leading design engineering firm with a sizeable energy and sustainability group, AKF is a key stakeholder offering a different perspective in the conversation surrounding building efficiency and viable engineering projects. 1211 Ave of Americas is a 45-story building boasting of 1.7m sq. ft, whose base building systems include four electric centrifugal 1,750 ton chillers, which had surpassed its average service life of 25 years. After analyzing the chiller logs and interval data, AKF’s team proposed that the building’s chiller plant be retrofitted with four new 1,400 ton electric centrifugal chillers with variable speed compressors along with a thermal storage ice plant. Even though the estimated peak demand savings and available incentives by including a thermal storage ice plant were significantly higher, the estimated capital investment required may have been short-term deterrent.

From a management perspective, William Vazquez, General Manager of 3 Bryant Park / 1095 Avenue of Americas, asserted that long-term ongoing efficiency upgrades lead to a 10-15-year ROI with continuous cost reductions. “Lowering operating expenses is key”, stressed William Vazquez. The number of watts per square foot and the number of people contributing to energy usage all contribute to overall operating expenses. Finally, Vazquez put emphasis on the need for landlords to incentivize deals, either through sub-metering, providing unique IP addresses to track and monitor reductions on particular floors, or through other means. This need to promote efficiency on all levels should be a driver for future initiatives, agreed Mr. Vazquez.

The experts on the panel also effectively highlighted the current landscape of demand response programs. Con Edison’s demand response program works with buildings to reduce peak loads through incentivizing building owners to invest in assets and technology that can provide reliable, responsive load reductions, i.e. virtual peak power services, including Real Time Energy Management (RTEM). Finding a way to provide an adequately long term and stable price signal to spur utility-scale consumer sided investment in distributed energy resources (DERs) is important, acknowledged Eric Davis. Energy efficiency programs and the scaling up of peak load programs is currently happening. Con Edison is committed to maximizing win/win solutions for consumers to assist with deferring infrastructure investments ultimately paid by ratepayers. For example, Con Edison, through recent program updates, focused on providing greater payment for high performance and reduced consumer exposure to costly penalties for non-compliance.   

Working with real-estate owners can also lead to an increased focus on simplifying energy monitoring, asserts Diana Sweeney, Co-founder and Chief Operating Officer of EnergyWatch. Online data management platforms deliver reports on line losses and margins, while cross referencing consumer rates to determine projected savings. Ms. Sweeney explained that in looking at NYC Retail Electricity Supply Components, roughly 35% of account pricing is comprised of capacity. NYISO’s transmission data shows that in UPNY/SENY for every two-thirds of demand for capacity there is only one-third of generation. In terms of reducing demand, she suggested that cost savings on the supply side may not always be equal to cost savings on the demand side. She argued that shifting consumption will not necessary lead to benefits from fixed pricing without strategic rate design, as long-term deals might not be able to properly leverage short term benefits. Finally, the Energy Watch COO asserted that the best approach is Measurement and Verification (M&V). Such a model focuses on pre-project rates, post-project rates, and interval data. Her final remarks emphasized the need for due diligence and a greater emphasis on exploring the many technological benefits for the grid.

Finally, New York Advanced Energy Executive Director and Founder/ CEO of Advanced Energy Group, H.G. Chissell underscored the need to further optimize energy efficiency and load flexibility while maintaining reliability and resiliency as core prerequisites. Acting as moderator, Chissell argued that with aging infrastructure, increasing population growth and NYC’s $1+ billion rising annual peak demand costs, these energy issues are highly interdependent across all key energy stakeholders.

The New York Advanced Energy Stakeholders Breakfast reveals an important evolution in the conversation regarding energy optimization and building efficiency. By bringing together, utilities, building owners and managers, engineers, and solution providers, diverse perspectives are shared, which proves necessary to create viable new energy projects that are both economical and sustainable. With REV and other programs causing a continuous shift in the regional energy landscape, bringing together leaders from different sectors is necessary to optimize the move towards smarter New York City. It is apparent that cost saving structures and incentives are hurdles that need to be overcome on the demand side. As the conversations continue, it will be interesting to see how these gaps are filled in innovative ways by the stakeholders.