SAN FRANCISCO, CA — EnerNOC's Gregg Dixon compares the competition between on-site renewable energy generation versus reducing energy demand to an MTV celebrity death match.
Which is more valuable?
In one corner we have on-site renewable energy projects that tend to carry more sex appeal, largely due to the industry's great job of marketing itself; there's even a renewable girls calendar. In the other corner are demand response and energy efficiency, which many would agree are anything but sexy.
The complex answer is both, Dixon said during a webcast held at GreenBiz.com's VERGE virtual conference. Employing many strategies and technologies are going to ultimately maximize energy management programs, but companies have to find a way to "reduce before they produce."
"If we don't get efficient first, it's the equivalent of not filling the hulls of a ship while replacing the masts and sail," Dixon said.
There is plenty of research supporting that energy efficiency is the single-largest untapped source for energy management, Dixon said. On a relative cost basis, energy efficiency "blows renewable energy out of the water." Some predict solar energy could reach cost parity with the expected electric retail rates within five years, Dixon said, but noted these types of predictions aren't new.
However, a slew of new technologies related to both efficiency and renewables are emerging to fill companies' energy management arsenal. Machines and systems have evolved to have a second power source, such as hybrid vehicles or a plastic injection molding machine which uses both hydraulics and electrical systems, said Michael Wynblatt from Eaton.
"Our view is that this trend is going to redouble in the future," Wynblatt said. "It's going to become increasingly common for systems, whether they're small as hand-held tools and devices, or as large as buildings and campuses, to have not just two, but three or even more power sources, and increasingly including one or more storage devices."
The existence of renewables make multiple power sources even more likely because they're inconsistent and subject to quality issues, he said. Enabling some of the key technologies will be all about power management and optimization, "systems that know how to get the most out of different sources, and know when to store and when to save over complex applications and complex duty cycles."
But how do companies evaluate which energy solution to use? Again, it's complicated, said Diversey's Jeramy LeMieux. Even when evaluating renewable energy projects against one another, competing attributes can muddy the water, such as rival payback periods, carbon reductions or the upfront capital. Then, of course, things can get more complicated when examined through the lens of sustainability (How important is wind energy if it's powering an incandescent light bulb?)
Ultimately, it's important to step away the view of on-site renewable power and energy efficiency project being discrete investments, but rather individual components of a broader strategy.
"A lot of the opportunities and benefits are really sitting staring all of us right in the face," LeMieux said. "It's just a matter of looking at the issues a little bit differently from a broader perspective and leveraging the individual benefits from your site to really maximize the bang for the buck and integrate it into the overall plan of the company."
Here are some general rules of thumb from Dixon on implementing an energy management program:
1. Don't Be a Victim of Green
"Green, clean renewable sources of energy unfortunately tend to polarize people than bring them together."
2. Determine Your Hurdle
Every organization has hurdles by which they make business decisions. "It's important to know that hurdle and make sure you're putting plans or making cases around those hurdles.
3. Do the Things with the Fast Economic Payback First
It may seem like a no-brainer, but often energy efficiency or reducing demand is sometimes not even considered. This will give you the internal currency to champion more sophisticated projects.
4. Reinvest that Currency into the Energy Management Lifecycle
Keep the momentum going!
Image CC licensed by Flickr user Angeloux.
Great article. You are right
Great article. You are right about green polarizing things. We need to step away from right/left green/polluter and focus on the criteria that businesses use to make decisions: risk, profits, and ROI. As for whether renewables or conservation win, I think it is a mistake to view it as an either or situation. Both can be good decisions, and the key is to prioritize projects based on their expected return.
Nice article, Tilde. There
Nice article, Tilde. There are definitely tensions among the various pieces of energy management and the vendors that provide those pieces -- it's definitely a "buyer beware" market. Those who advocate for a more holistic approach are on the right path. I'd also suggest peeling the onion one layer deeper. The most efficient way for a business to reduce its energy costs is to procure energy more efficiently. Advances there are saving customers 7-10% on their energy costs with no upfront payment or risk: http://bit.ly/l7Gctr
That savings is what can then fuel investment in renewables or efficiency measures.
Was the occupant and behavior
Was the occupant and behavior discussed during Dixon's presentation as part of the efficiency equation? In the end, the occupant, their needs and their behavior are key to efficency, both in terms of selecting/designing building or O&M focused energy conservation measures (ECMs) that also meet occupant needs, as well as selecting/designing ECMs, policies/procedures that directly and indirectly guide occupant behavior in a desired direction.
"Ultimately, it's important
"Ultimately, it's important to step away the view of on-site renewable power and energy efficiency project being discreet investments, but rather individual components of a broader strategy."
Exactly! ...and efficiency not only pays first, but most often makes it easier to meet residual demand from renewables. I believe your thoughts also apply to the even broader energy system, not just on-site powergen. Nicely articulated.