Energy Background: Energy Background Rising Costs & Price Volatility
Fuel Supplies Less Reliable
Weather Concerns
Instability in Oil Producing Nations
High Demand
Greenhouse Gas Issues
Managing Your (Rising) Energy Costs: Managing Your (Rising) Energy Costs Energy Costs have risen dramatically over the past couple of years
Commodity Pricing (without transmission charges)
Crude Oil – NYMEX Crude Futures around $67/bbl for January 2006 delivery. Average prices for 2001 were around $22/bbl
Natural Gas – NYMEX Futures around $12.50/MMBtu ($1.25 per therm) for October delivery. Average industrial user pricing for 2001 was $5.1/ MMBtu ($0.51/therm) and $3.91/MMBtu ($0.39/therm) for 2002.
Electricity – New Jersey Industrial User Average Pricing for June 2005 - $0.987/kWh, June 2004 - $0.836
Source – Energy Information Administration Website (www.eia.doe.gov)
Future Energy Pricing Uncertain: Future Energy Pricing Uncertain Forecasts for the near term future are trending upward
Tight refinery capacity makes it difficult to predict the next event that could impact pricing
Rising energy costs erode profits for companies Crude Oil Spot Prices Natural Gas Futures Source – Energy Information Administration Website (www.eia.doe.gov)
Where does our energy come from?: Where does our energy come from? Understanding the risks associated with fuel supply requires and understanding of where fuel comes from.
Top 10 Suppliers of U.S. Crude Oil Imports for 2004*: Top 10 Suppliers of U.S. Crude Oil Imports for 2004* * Source – Energy Information Administration Website (www.eia.doe.gov)
Risks to Crude Supply: Risks to Crude Supply Approximately 2.4 million Barrels per day or 24% of imported crude oil comes from the Persian Gulf
Venezuela and Nigeria produced approximately 2.4 million barrels per day or 24% of imported crude
Nearly 48% of imported crude comes from regions of risk due to political instability * Source – Energy Information Administration Website (www.eia.doe.gov)
Refinery Capacity: Refinery Capacity World Demand is at an all-time high due to economic growth over the past couple of decades
US demand is at all time high. Lack of investment in new refinery capacity has caused production bottleneck
Hurricanes - Katrina & Rita have highlighted the risks to Gulf of Mexico Production and Refining Facilities
Natural Gas Imports/Exports: Natural Gas Imports/Exports In 2004, approximately 15% of US gas consumption was from imports, mostly from Canada.
Demand for natural gas is increasing beyond North American production rates, so LNG imports are growing. Trinidad, Algeria, Qatar and Nigeria provided 95% of LNG imports from 2000-2004.
Continued increases in demand will tax the capacity of transcontinental pipelines, requiring increased LNG imports to meet demand in northeastern US. Source – Energy Information Administration Website (www.eia.doe.gov)
US Electric Generation Fuel Sources: US Electric Generation Fuel Sources Source: Energy Information Agency Quickstats (http://www.eia.doe.gov/neic/quickfacts/quickelctric.htm)
So here we are…: So here we are… Today’s energy crisis is different than that of the mid 1970’s, which turned out to be a short term event.
Increased demand for crude oil and natural gas will be met by foreign sources
US continues to lack a comprehensive energy strategy to reduce dependence on foreign supplies, therefore;
Reliability and pricing concerns of our energy supply will likely be with us for the long haul
So what can you do about it?
Before you get started…: Before you get started…
Get upper management involved. You cannot succeed without senior management support for an energy reduction program (formal program that has targets in senior management objectives – Novartis recently signed off on Kyoto Protocol – 5% reduction in greenhouse gases from 1990 levels by 2008 – 2012)
Collaborate with others in your industry. This will allow you to take advantage of the ideas and lessons learned by others. (PMON, NJP&FEUG, NJLEUC, NJAEE)
Engage different user groups (maintenance, manufacturing, environmental, others) on site to brainstorm opportunities. This is especially important for sites where manufacturing operations are energy intensive.
Before you get started…: There are many resources to help you develop your plan. Two good resources are:
Energy Star (www.energystar.gov)
US Department of Energy – Energy Efficiency and Renewable Energy (http://www.eere.energy.gov/)
Both websites have good information on strategies and case studies to learn from
If you lack the resources, time or expertise, consider engaging a consultant with expertise in energy reduction programs Before you get started…
Energy Star Steps for Energy Reduction Program: Energy Star Steps for Energy Reduction Program Make a Commitment - Organizations seeing the financial returns from superior energy management continuously strive to improve their energy performance. Their success is based on regularly assessing energy performance and implementing steps to increase energy efficiency.
Assess Performance - Understanding current and past energy use is how many organizations identify opportunities to improve energy performance and gain financial benefits. Source: Energy Star Website (http://energystar.gov/index.cfm?c=guidelines.guidelines_index)
Energy Star Steps for Energy Reduction Program cont..: Set Goals - Performance goals drive energy management activities and promote continuous improvement. Setting clear and measurable goals is critical for understanding intended results, developing effective strategies, and reaping financial gains.
Create Action Plan - With goals in place, your organization is now poised to develop a roadmap to improve energy performance. Source: Energy Star Website (http://energystar.gov/index.cfm?c=guidelines.guidelines_index) Energy Star Steps for Energy Reduction Program cont..
Energy Star Steps for Energy Reduction Program cont..: Implement Action Plan - People can make or break an energy program. Gaining the support and cooperation of key people at different levels within the organization is an important factor for successful implementation of the action plan in many organizations.
Evaluate Progress - Evaluating progress includes formal review of both energy use data and the activities carried out as part of the action plan as compared to your performance goals. Source: Energy Star Website (http://energystar.gov/index.cfm?c=guidelines.guidelines_index) Energy Star Steps for Energy Reduction Program cont..
Energy Star Steps for Energy Reduction Program cont..: Recognize Achievement - Providing and seeking recognition for energy management achievements is a proven step for sustaining momentum and support for your program. (Novartis uses HS&E success stories and Energy Awards.)
Reassess – As you move forward with your plan, changes in your site or the energy marketplace should be considered, and adjustments made to your plan to keep it appropriate. Source: Energy Star Website (http://energystar.gov/index.cfm?c=guidelines.guidelines_index) Energy Star Steps for Energy Reduction Program cont..
Strategies: Strategies Collect data on consumption – utility company bills, internal distribution metering. Look at the past couple of years to determine trends and identify areas of opportunity. Tracking will be important to identify opportunities, establish a base case for financial analysis of energy opportunities and verify savings, identify metering deficiencies early and how information should be presented early on.
Many facilities have sophisticated Building Management Systems that could be better utilized to reduce energy consumption. System integrators are typically not tasked to provide optimal operating programming up front, and, over time individuals may have altered programming for convenience. Take a systematic approach, as each opportunity arises, see where else it can be applied in a campus environment.
start with how your facilities are currently operating
Strategies: Maintenance of systems – properly maintained systems utilize less energy to perform the same work.
Look at your Building Management Systems
Check space temperature setpoints. Verify that they are acceptable. Adjust as required to reduce energy consumption while maintaining comfort.
Check calibration of key parameters like outside and interior temperature sensors. Also check flow meters and differential pressure sensors where a central chiller plant is supplying multiple
Verify that time of day/week occupied/unoccupied settings are correct and functional
Optimize start/stop of systems Strategies start with how your facilities are currently operating
Strategies: Make sure that you change HVAC filters regularly – added pressure drop = increase to fan energy. Novartis has standardized on an extended bag filter that fits most air handlers, reducing change-out frequency and pressure drop
Perform vibration analysis on all equipment 5 HP and above (less for critical systems). Novartis performs this as part of commissioning to avoid inheriting problems, and routinely so as to shift from preventative to predictive maintenance. Before / after repair testing demonstrates energy savings.
Evaluate chiller plants, compressed air systems and boilers using third parties specializing in these systems. Strategies start with how your facilities are currently operating
Start with the biggest users of energy : Start with the biggest users of energy
Determine where your buildings are operating relative to similar buildings. Energy Star Portfolio Manager can help, however labs and manufacturing buildings have not been benchmarked. Labs 21 (http://www.labs21century.gov/toolkit/benchmarking.htm) can help with laboratories and clean rooms
Use auditing tools to identify opportunities to improve energy performance
Take care not to delay starting obvious initiatives (maintenance, BMS system adjustment) while waiting for a comprehensive review, which may take up to a year depending on the size of your facility. your buildings
Slide24:
Check space temperature setpoints. Verify that they are acceptable. Adjust as required to reduce energy consumption while maintaining comfort.
Verify that time of day/week occupied/unoccupied settings are correct and functional. Utilize “intelligent” programs to start/stop and sequence systems Look at your Building Management Systems
Slide25:
In the past, projects were performed only considering the additional energy needs of the project
Where it makes sense, larger projects can provide a good opportunity to increase the energy effectiveness of a facility. Increases to on-site energy generation can be considered to meet capacity and increase efficiency.
Architectural Masterplans should be complemented with an Energy Master Plan. The Energy Masterplan should maximize the return on investment of systems utilizing energy. Lifecycle costing of systems should be performed to verify the true low cost system. Novartis is performing energy modeling of new facilities.
Some sites are reducing the number of buildings or changing from manufacturing to office, lowering energy demand. This can lead to oversized and potentially inefficient on site energy plants. Novartis recently reduced energy consumption by converting old labs and manufacturing space to office space. Facility Renovations, Expansions and Contraction
Slide26: Take advantage of rebates to buy more efficient equipment in your construction projects.
Replace older, less efficient equipment.
Look at replacement options – like for like replacement may not improve efficiency as much as technology change.
Upgrade controls and sequence of operations
Take advantage of incentive $’s for renovation and new projects – NJ Smart Start Program Energy Reduction Program
NJ Smart Start Program: NJ Smart Start Program Incentive program for utilizing equipment meeting efficiency requirements – see NJ Smart Start website for details (http://www.njsmartstartbuildings.com).
Design Support
Design Incentive $’s
Brainstorming Session (Up to $1000)
Energy Simulation Incentive ($0.10/sq.ft. up to 50,000 sq.ft., $0.03/sq.ft. for area over 50K sq.ft.)
Measure Design Incentives for incremental cost of design of more complicated energy saving measure for Lighting (Max $2,000), HVAC and Envelope (Max $2500), and Motors and Other (Max $500)
Electric Chillers [Water-cooled chillers ($12 - $170 per ton), Air-cooled chillers ($8 - $52 per ton)]
Gas Cooling [Gas absorption chillers ($185-$450 per ton), Gas Engine-Driven Chillers (Calculated through Custom Measure Path)]
Source – New Jersey Smart Start Program Website (www.njsmartstartbuildings.com)
NJ Smart Start Program cont…: NJ Smart Start Program cont…
Desiccant Systems ($1.00 per cfm - gas or electric)
Electric Unitary HVAC
Unitary AC and split systems ($73 - $92 per ton)
Air-to-air heat pumps ($73 - $92 per ton)
Water-source heat pumps ($81 per ton)
Packaged terminal AC & HP ($65 per ton)
Central DX AC Systems ($40 - $72 per ton)
Dual Enthalpy Economizer Controls ($250)
Ground Source Heat Pumps [Closed Loop & Open Loop ($370 per ton)]
Gas Heating [Gas-fired boilers ≤ 4000 MBH ($1.00 - $2.00 per MBH), Gas-fired boilers > 4000 MBH (Calculated through Custom Measure Path), Gas Furnaces ($300 per unit)]
Source – New Jersey Smart Start Program Website (www.njsmartstartbuildings.com)
NJ Smart Start Program cont…: Variable Frequency Drives [Variable air volume ($65 - $155 per hp), Chilled-water pumps ($60 per hp)]
Natural Gas Water Heating [Gas water heaters ≤ 50 gallons ($50 per unit), Gas-fired booster water heaters > 50 gallons ($1.00 - $2.00 per MBH), Gas-fired booster water heaters ($17 - $35 per MBH)]
Premium Motors [Three-phase motors ($45 - $700 per motor)]
Prescriptive Lighting
T-5 and T-8 lamps with electronic ballast in existing facilities ($10 - $20 per fixture)
Hard-wired compact fluorescent ($25 - $30 per fixture)
Metal halide w/pulse start ($45 per fixture)
LED Exit signs ($20 per fixture)
T-5 and T-8 High Bay Fixtures (New Fixtures meeting requirement 8.1 on application) $50 per fixture
T-5 and T-8 High Bay Fixtures (New Fixtures meeting requirement 8.2 on application) $75 per fixture Source – New Jersey Smart Start Program Website (www.njsmartstartbuildings.com) NJ Smart Start Program cont…
NJ Smart Start Program cont…: LED Traffic Signal Lamps
Lighting Controls
Occupancy Sensors [Wall mounted ($20 per control), Remote mounted ($35 per control), Daylight dimmers ($25 per fixture controlled), Occupancy controlled hi-low fluorescent controls ($25 per fixture controlled)]
HID or Fluorescent Hi-Bay Controls [Occupancy hi-low ($75 per fixture controlled), Daylight dimming ($75 per fixture controlled)]
Source – New Jersey Smart Start Program Website (www.njsmartstartbuildings.com) NJ Smart Start Program cont…
NJ Smart Start Program cont…: Other Equipment Incentives*
Performance Lighting ($1.00 per watt per square foot below program incentive threshold, currently 20% more energy efficient than ASHRAE 90.1-1999 for New Construction and Major Renovation and 10% more energy efficient than ASHRAE 90.1-1999 for Existing Facilities.)
Custom electric and gas equipment incentives (not prescriptive)
*Equipment is based on type, efficiency, size, and application and is evaluated on a case-by-case basis. Contact your utility for details. Source – New Jersey Smart Start Program Website (www.njsmartstartbuildings.com) NJ Smart Start Program cont…
Slide32:
Manufacturing processes tend to be very energy intensive. There may be an opportunity to shift work to have more energy intensive operations on off-hours with lower electric rate
Work with representatives of manufacturing to identify opportunities to reduce energy usage. They will resist, so be prepared to encourage them with potential energy savings
Minimize air exchange rates. Novartis has been able to reduce air exchange rates in pilot plants and lab buildings by carefully considering requirements and working with all stakeholders well in advance. Manufacturing
Slide33: Once you have look at your buildings, focus on your on site energy generation
Boiler Plant
Chiller Plant
Compressed Air Plant
Cogeneration
Tools for Maximizing Plant Efficiency Site Energy Generation
Slide34: Regularly test boiler efficiency – tune and adjust to maximize efficiency
Tune boilers to specified excess air levels. Utilize O2 trim control where possible
Consider back pressure turbines for reducing pressures for larger quantities of steam
Evaluate flue gas economizer and blowdown heat recovery
Evaluate water treatment program – bad water treatment reduces heat transfer efficiency
Load matching – operate at best efficiency point
Replace oversized equipment with appropriate boiler sizing to avoid unnecessary cycling and low load operation
Multi-fuel capability – also consider alternate renewable fuels (like biofuels)
Steam Trap Maintenance
Verify that steam traps are operating properly, repair or replace malfunctioning traps.
Consider remote monitoring capability
Novartis commissioned a steam trap survey which identified 5% of traps at the East Hanover site were plugged or passing steam (industry average is around 10%). The energy savings more than offset the repairs and the cost of the survey Boiler Plants
Slide35: Utilize controls system to optimize operation of chillers
Base load most efficient units
Consider replacement of older, less efficient equipment
Consider diversification of fuels, with a mix of electric, steam (absorption or turbine) and gas fired to hedge against changes in fuel costs and to avoid time of day and demand charges
Employ some metrics to determine if chiller plant is running optimally throughout the cooling season, and to direct maintenance activities in the winter months. GE Betz offers a program called Chiller Check for a fee. Existing Chiller Plants
Slide36:
Do not oversize the plant unnecessarily. Operating chillers at partial load can reduce efficiency. Select module sizes to maximize loading based on anticipated load profiles, while also considering redundancy
Consider diversification of fuels, with a mix of electric, steam (absorption or turbine) and/or gas fired absorption to hedge against changes in fuel costs and to avoid time of day and demand charges
Consider the use of heat machines, or comparable equipment, to take waste heat from the condenser and utilize it for free heating in reheat or other lower temperature systems
Consider the use of thermal storage systems to reduce plant size. This strategy will minimize time of day and demand charges.
Optimize your chilled water distribution system to minimize pumping costs
Utilize VFD control for chillers, pumps and cooling tower fans
Utilize controls system to optimize operation of chillers
Base load most efficient units New Chiller Plants
Slide37: Compressed air systems - Assess the efficiency of the compressed air plant. Older plants that have been incrementally enlarged may operate inefficiently. Consider strategies to address:
Compressors controlled from a central controller to maximize efficiency
Enlarging the compressed air receiver to reduce run time for compressors
Pressure and demand matching
Perform regular inspections of system to verify the leakage is minimized. When possible, add manual and/or automated valves to shut off air flow when user equipment is shut-off. This is particularly important with packaging equipment
Interconnecting separated systems, where possible, to minimize the number of compressors required to operate
As with all other systems – good maintenance will go a long way to improving performance of the system Compressed Air Systems
Slide38: Model each on-site utility generation system to develop operating scenarios that maximize plant efficiency
Know the implications of changes to fuel prices on selection of generation equipment to run
Weather plays a part – non-process HVAC loads are typically proportional to outside temperature. This may allow you to model your systems as a function of outdoor conditions giving operators the most efficient operating configuration in advance Optimize Utilization of On Site Generation Assets
Buying Your Energy: Buying Your Energy Strategies – Buy your energy smarter
Bid energy contracts – beware of entering into long-term contracts at peak price points
Take advantage of buying power. Aggregate your facilities to buy energy in larger quantities to reduce price.
Be part of an energy buying consortium to buy energy with others, particularly if you don’t have an energy manager tracking the market
Consider longer term buying horizon to gain some surety of pricing. Novartis is working toward a 24 month rolling buying horizon.
Requirements: Requirements Provide sufficient capacity (electric / thermal)
Assure reliability (normal grid / outages)
Achieve Cost savings
Minimize Cost volatility
Meet or exceed emission standards
Earn LEED credits
Key Particulars: Key Particulars Hybrid (Multi-Fuel) Cooling/ Heating Systems Baseload Cogeneration “Sized to the Thermal”
Peak Power Purchase from Grid Conventional/ Renewable Electric Energy Blend
Demand Response / Standby Generation
On-Site Renewable supply where feasible and economical
Integrated Electric Supply Approach: Integrated Electric Supply Approach 1 Wholesale generators
2-4 Transmission owners
5-6 LDC
7 Consumer
On-site generator
Energy Services
Provider
Facility Audits and Benchmarking: Facility Audits and Benchmarking Strategies – Audit and Benchmark Your Facilities
Use auditing tools from Energy Star, DOE, AEE, or other reputable source.
Start with big users of energy first.
Involve manufacturing and environmental compliance representatives
Make sure you find all big users of energy. Items like thermal oxidizers can use large quantities of energy
Facility Audits and Benchmarking: Once you know where you are – develop goals for where you want to be, along with a road map for getting there.
Goals should be achievable and in concert with corporate priorities. Timelines must be monitored and long term goals adjusted to reflect changes in energy use patterns, energy costs and changing corporate priorities.
Many large companies already have corporate goals for energy conservation and emissions reductions.
J&J - greenhouse gas emissions – “4% reduction by 2005 and a 7% reduction by 2010, in absolute terms with 1990 as a base year.1”
Novartis – “The Group has adopted energy- efficiency targets for 2004–06, calling for each business unit to improve energy efficiency by 2% a year. Half of this reduction, 1% of annual consumption, should come from concrete energy-saving projects.2” Novartis recently signed the Kyoto Protocol thereby committing to reducing the company’s GHG emissions 5% below 1990 levels in the time period 2008 - 2012 1 Source – J&J Corporate Website – Climate Friendly Energy Policy
2 Source – Novartis Corporate Website – Corporate Citizenship Facility Audits and Benchmarking
Recent Audit Project: Recent Audit Project Example – Audit of a 250,000 square foot pharmaceutical manufacturing facility with office and warehouse space
Audited June 2005 – Identified opportunities for energy savings
Direct Fired Thermal Oxidizer - add heat recovery to extract waste heat from 1500oF exit gas temperature, recovering over 65% of input heat
Add VFD’s to chiller and pumps
Revise operation of boiler plant
Add 1.2 MW of photovoltaic electric on site
Reduce electric consumption over 2,000 MWh per year
Once changes are implemented, energy savings are estimated at approximately $750K per year at current utility rates, for an IRR of approximately 15%
Estimated 3,500 metric tons per year reduction in CO2 emissions
HVAC Controls Systems Upgrades: HVAC Controls Systems Upgrades Examples
VAV Laboratory Systems with Occupancy Sensors – reduced airflow (as much as 60% over constant volume) = reduced energy $’s
VAV system optimization – Allow control system to adjust AHU discharge temperature to minimize reheating
Chiller Plant Optimization
Monitoring of generation and usage parameters – interpret trends and adjust operations to address changes
Below Radar Screen Energy Savings: Below Radar Screen Energy Savings Flywheel UPS vs. Battery UPS
Must be combined with reliable backup power generator
Very reliable link to standby generator
Provides sufficient energy ride through time to initiate generator start online
Environmentally Friendly - Battery free, therefore no battery chemicals
Reduced maintenance, smaller footprint and much less weight
Does not require dedicated air conditioning of room
Saves Energy
Efficiency Cost Savings Example 300 kVA System: Efficiency Cost Savings Example 300 kVA System Battery UPS (avg. 93% efficiency):
$15,824 = $.08/kw X .07 efficiency loss X 300 kva X 8760hrs/yr
.93 efficiency
Flywheel UPS (avg. 97% efficiency):
$6,502 = $.08/kw X .03 efficiency loss X 300 kva X 8760hrs
.97 efficiency
Energy Cost Savings = $9,322 per year, not including savings from reduction of HVAC load
EPRI Power Quality Study (USA): EPRI Power Quality Study (USA) 2 Yr Study, 300 Sites, 24 Utilities 97.2% under 30 sec.
96.3% under 10 sec.
93.0% Under 2 sec Yearly Events
On Site Generation: On Site Generation Advantages
Base load power needs are provided on site
Steam or hot water for facility heating and/or cooling provided from waste heat
Improved reliability – grid backs up on-site generator
Emissions lower when compared to electricity generated by the utility company
Economic payback can be achieved
Disadvantages
Increased maintenance
Takes up real estate that may be more valuable when utilized for manufacturing space
Emissions tagged to site
Fuel cost not always linked. Cogen economics are dependent on relative cost of fuel burned to electric utility rates
On Site Generation: On Site Generation Site Electric and Thermal Loads Need to be Compatible
Equipment typically sized to base load of electrical and thermal loads
Heat recovered by HRSG is used to displace fuel for boiler operations resulting in energy savings and a reduction in plant emissions
Slide54:
* Reproduced from NJ Clean Energy Program Website On Site Generation
Slide55: Example:
Take a 1.0 MW Gas Turbine Generator with Heat Recovery Steam Generator
Assume Implementation Cost About $2.5 Million
Level II Incentive = $1.00/Watt to Max 30% of Project Cost, or $750,000 - Other NJ Smart Start Incentives for Balance of Plant
Reducing project cost by 30% can take a 10% IRR project to 15% On Site Generation
Larger Scale Cogeneration: Larger Scale Cogeneration Pharmaceutical Mfg. Campus – 2004 Study – Project Being Implemented 2005/2006
4.5 MW On-Site Generating Capacity
14,000 PPH Steam from HRSG
Implementation Cost Estimate $8 million (Includes Ancillary Work Outside of Cogen)
NJ Clean Energy CHP Program Rebate estimated at $1 million
Estimated Savings $1.4 million
IRR around 15%
Estimated CO2 Reduction – 6,200 Tons/year
Small Scale Cogen – Sterling Engine: Small Scale Cogen – Sterling Engine Revenue with PPA at $0.05/kWh Payback – 55KW Stirling Engine Including Installation,
Tax Credit Incentives and O&M Costs
Renewable Fuel Sources: Renewable Fuel Sources Consider Renewable Fuel Sources
Solar – photovoltaic
Biofuels
Digester and Landfill Gas
Wind Power
Geothermal
Waste Stream Recovery
Many states have generous incentive programs for projects using renewable fuels – New Jersey and California are leaders
Renewable Fuel Sources: Solar – Photovoltaic Power Generation
True renewable fuel source
Incentive program in NJ for installation (see Chart on next slide)
Federal Incentive Tax Credit of 30% of implementation cost
Generate Solar Renewable Energy Credits which can be sold, providing revenue
Net Metering Provision in NJ - Systems < 2 MW of capacity can reverse the electric meter when site demand is less than solar generation, effectively selling electricity at the price you pay! Renewable Fuel Sources
Solar Power Incentives : Solar Power Incentives * Reproduced from NJ Clean Energy Program Website NJ Clean Energy Program – Renewable Energy Financial Incentives
Solar Renewable Energy Credits (SREC): Solar Renewable Energy Credits (SREC) NJ’s Renewable Portfolio Standard (RPS) requires electricity suppliers provide a percentage of their electricity sales from solar generation.
1 SREC = 1000 kWh of power generated by solar energy
You can sell SRECs through NJ SREC Program
Values have been averaging between $160 - $178 per MWh since August 2004
[ex. 100kW system operating an average of 10 hours per day for 250 days per year with SREC $160/MWh ($0.16/kWh) would generate SREC sales of $40,000 per year]
Recent Solar Energy Study: Recent Solar Energy Study Recent Study for Solar Project in California
Nominal 1200 kW Ground Mounted Tracking System
Implementation Cost Approximately $8 Million Before Incentives, Tax Credits
Incentives and Tax Credits Reduce Implementation Cost by Approximately $3.5 Million
Estimated savings of 1.9 Million kWh per year
Estimated IRR of Over 13%, not including SRECS
Summing Up: Summing Up You can improve your energy performance by:
Operating your existing facilities more effectively by maintaining and tuning existing systems
Developing and Implementing and Energy Reduction Program
Auditing and Benchmarking Your Facilities
Taking Advantage of Incentive Programs to Implement Efficiency Upgrades
Optimize Operation of On Site Generation Assets
Educating Colleagues About Ways They Can Help
Making Energy Efficient Operations Part of Your Job