How to save energy and reduce your heating bill23 February 2016 | Hampden Park

Workshop aim

To provide you with the skills and tools to:

• Establish your own organisation’s heating

energy use

• Identify opportunities for improvement

• Build the business case for measures

Today’s agenda

09:15 Welcome & drivers for resource efficiency

09:35 Understanding your current energy usefor space heating Exercise 1 and Q & A

10:35 Thermal Efficiency

11:10 Networking Break / Meet Suppliers

11:30 Heating distribution and control

11:50 Boiler replacement and fuel switchingExercise 2

12:30 Making a business case

12:35 Case study (Green Network for Businesses)

12:50 Q & A and Next Steps

13:00 Networking lunch + Museum Tour

Why resource efficiency?

What are resources?

Water Energy Raw Materials

A global downturn?

Oil Copper Cotton Soya

23% 68% 18% 16%

Global growth rates

Critical resources arerunning short

Silver <30 yearsIndium <10 years Zinc <40 years

• Landfill Tax Regulations 1996

─Currently £80/tonne

• Waste (Scotland) Regulations 2012

─paper, card, plastic, glass and metal

• Climate Change (Scotland) Act 2009

─80% reduction in GHG emissions by 2050

• CRC Energy Efficiency Scheme

• Climate Change Agreements (CCA)

Legal drivers

Growth that doesn’t cost the earth

Increasing energy prices and market

volatility

Rising material and waste costs

More demanding customers

Increased efficiency &

profits

Improved staff morale

+ recruitment

Green credentials + increased sales

Resource efficiency drivers

FINANCIAL PRESSURE

IMPROVED COMPETITIVENESS

Understanding your current energy usefor space heating

Types of heat

What is thermal comfort?

• Different for every person

─Air temperature

─Radiant temperature of surfaces

─Relative humidity

─Air movement

─Metabolic heat / Activity level

─Clothing

─Well being

What are sources of heating?

• People

• Thermal mass

• Insolation

• IT

• Cooling equipment

• Process equipment

• Heating system

Understanding the units

Electricity Example

A 1-bar electric fire has a

power rating of 1kW

Running for one hour

uses 1kWh

Assuming 13p per kWh

= 13p per hour

Gas Example

A 27kW domestic gas boiler

runs at a duty rate of 30% on

a cold evening so the average

power rating is 8.1kW

Running for one hour uses

8.1kWh

Assuming 4p per kWh

= 32p per hour

Energy is measured in kWh – kilowatt-hour

One kWh is one unit on an electricity or gas bill

A kilowatt-hour is the energy used by a 1000 watts appliance

running for an hour

What data should you collect?

• Record kWh and cost from each quarter or monthly bill

• Collect at least 1 year of data, preferably 3 years

• Estimate that around 10% of heating will be used for hot water

What about electric heating?

• Some buildings will use direct resistive heating either for direct panel heaters or air-conditioning units

• If you only have one electricity bill then you can make a quick estimate that 50% of electricity is used for heating and 50% is used for all other electricity needs

• Some electrically heated sites will have a separate circuit supply storage heaters on a cheaper rate.

Worked example

• Average gas cost for last 3 years is £6,300

– how many kWh of gas is being used if last billsays the unit rate is £0.04?

• Answer gas kWh = [gas cost £]/[unit cost in £/kWh]

= £6,300/£0.04

= 157,500 kWh

Worked example

• We know that 5 x 2kW electric bar fires are also being used as supplementary heating for 8 hours on 100 days per year.

• How much is this costing compared to the gas?The unit rate for electricity is £0.12/kWh

Answer: kWh of electricity = 10kW x 8 x 100 hours

= 8000kWh

Answer: Cost of electricity = 8000kWh x £0.12/kWh

= £960

Smart metering

• Smart metering is due for all SMEs between 2015 and 2020

• Many already have ‘Advanced Meters’ which provide daily or half-hourly data

• A smart metering trial found that giving organisations good data resulted in a 5% reduction with no other input (Carbon Trust Smart Metering Trial 2007)

Measuring and monitoring spreadsheet

Using graphs and charts

External factors

Identify other influences on your data:

• Cost

• Outside temperature or weather conditions e.g. degree days

(www.eci.ox.ac.uk/research/energy/degreedays.php#degreeday)

Benchmarking

• To allow comparison between buildings it is useful to compare kWh/m2/year (kilowatt-hours per square meter per year)

• So for a 20m x 50m factory = 1000m2

• Considering the previous example with 157,500kWh

• Consumption per m2 = 157,500/1000 = 157.5kWh/m2/year

Benchmarks for heating(CIBSE TM46)

Building type Fossil-thermal typical benchmark kWh/m2/year

General office 120

Large non food shop 170

Bar, pub 350

Hotel 330

Workshop 180

Fitness and Health Centre 440

Storage Facility 150

Use benchmarks to...

• Understand your current space heating costs

• Set targets for reduction

• Estimate savings potential

• Discuss options with senior management

• [Larger organisations should consider degree-day benchmarks]

Exercise 1

Exercise 1 (20 minutes)

You work for a small manufacturer. Your site has two buildings:an office heated with electric storage heaters; and a gas-heated engineering workshop.

You want to reduce your space heating bill. Based on the information below, which building would you say has the greatest savings potential?

Key information:

General office Heating Electricity cost Y1: £3,450Heating Electricity cost Y2: £3,250Heating Electricity cost Y3: £3,400

Unit cost: £0.08/kWhOffice size: 200m2

Workshop Gas cost Y1: £4,500Gas cost Y2: £4,900Gas cost Y3: £4,700

Unit cost: £0.04/kWhWorkshop size: 600m2

Helpful hints

• Step 1 – Find the average energy bill for the last 3 years

• Step 2 – Find the kWh usage

─ Either read from bill (data not presented in example) or calculate from cost

─ Energy [kWh]= Cost [£] / Unit cost [£/kWh]

─ Take off an estimated % for non-heating use.

• Step 3 – Find the kWh per square meter

─ Energy per square meter [kWh/m2] = Energy [kWh] / Area of premises [m2]

• Step 4 – Compare Energy per square meter with benchmarks

• Step 5 – What is your conclusion about where savings could be made?

• Step 1 – Find the average energy bill for the last 3 years─ Office 3 yr average = £3,367

─ Workshop 3 yr average = £4,700

• Step 2 – Find the kWh usage

─ Either read from bill (data not presented in example)or calculate from cost

─ Energy [kWh]= Cost [£] / Unit cost [£/kWh]• Office = 42,083.33 kWh

• Workshop = 117,500 kWh

─ Take off an estimated % for non-heating use. • Workshop reduced usage = 105,750 kWh

• Step 3 – Find the kWh per square meter

─ Energy per square meter [kWh/m2] = Energy [kWh] / Area of premises [m2]• Office = 210.42 kWh / m2

• Workshop = 176.25 kWh / m2

• Step 4 – Compare Energy per square meterwith benchmarks

Benchmark

(kWh / m2)

Our Site

(kWh / m2)

General office 120 210.4

Workshop 180 176.3

Thermal Efficiency

• Heat loss calculation

─ Boiler sizing

─ Back-up heating requirements

• Identify improvement opportunities

• Prioritise options

Quantitative understanding

• Roof

• Walls

• Floor

• Windows

• Doors

Fabric elements

Energy = Power x Time

Watt-hours = Watts x Hours

This is what we need to find out

• Measurement of the rate of heat transfer

• Standard values available to look-up

• Manufacturers / installers should be able to provide value

• U-Value = W / m2 / K:

/ square meters / KelvinWatts

U-Value

• Heat loss through walls

─ You have a solid walled building, with external wall area of 250m2.

─ You heat the building to 21oC and the average external temperature is 3oC

─ What is the heat loss through the walls?

Worked example

Heat Loss (Watts) = U-Value x Area x Δ T

250m2

21oC - 3

oC = 18

oC

Worked example

Heat Loss (Watts) = U-Value x Area x Δ T

250m2

21oC - 3

oC = 18

oC

2.1

Worked example

2.1 x 250m2

x 18oC = 9,450 Watts

9,450 ÷ 1,000 = 9.45kW

Worked example

A caveat!

These calculations are based purely on structural elements.

What else will impact on heat loss and energy demand?

Other factors

Ventilation heat loss

Hot water demand

Internal heat gains – power appliances (PC,

photocopier)

Internal heat gains – process

People

Lights

Solar gain

Boiler Efficiency

Rebound effects – the ‘Comfort Factor’

Improve the thermal performance of building fabric

• Loft insulation

• Under roof insulation

• Beware of asbestos

• Cavity wall insulation

• Check condition of wall for exposed locations

Improve the thermal performance of building fabric

Reduce uncontrolledair leakage

• Doors

• Windows

• Other draughts

• Check ventilation levels

are correct for current

activities

• Consider LEV (local

extract ventilation) for

dusty or fume filled

environments to

reduce heat losses

Reduce uncontrolledair leakage

Consider mechanicalheat recovery

• Air-to-Air heat exchangers can save up to

50% of heating consumption

Heating distributionand control

What do we mean by heat distribution?

• The system that delivers heat from sourceto point of use

• Usually ‘wet system’ with radiators

• Or air source heat pump

• Offers good potential for savings via improved controls

• Insulate pipework─ In plant rooms (easy fix velcro attachments

are available for awkward flanges and bends)

─ Consider insulating distribution pipework if itdoes not contribute useful heat

• Keep space around space heaters free─ Avoid files, desks and furniture up against heaters

─ Leave 15cm between radiators and furniture

• Record your heating system settings─ Use a simple record sheet to record date and change made─ Put dates in the diary (clock changes), Xmas holidays to change

settings as needed

Warm air distributionsystems

• May be HVAC system with gas boiler or ASHP

─Some HVAC systems can be adapted to make use of free cooling (cold outside air) and excess heat internal to the buildings (e.g. server rooms)

─Consult a specialist

• Consider VSDs (Variable Speed Drives) for HVAC and circulation pumps

• Ensure a dead band of 4 degrees C is set between heating and cooling

Typical heating controls

• Time clocks

• System thermostat

• Localised thermostats such as thermostatic radiator valves (TRVs)

• Zone controls (BEMS)

Types of time control

• Time clock

─Set start and finish times each day

• 7 day timer

─Set for earlier start on Monday morning

• Optimised heating controller

─Uses inside and outside temperature sensors

─Learns your building heat up time for different temperatures

─Switches on as late as possible

• Switch your heating off early

─Many buildings store heat effectively

─People and IT can maintain the buildingtemperature from mid-afternoon

─Try moving your switch off time back an hour

• Consider hot-desking

─Heat from occupants is concentrated in one area

─Switch off heating earlier in un-occupied areas

• Make sure colleagues understand controls

• Set appropriate temperatures

─Office / low activity 20°C

─Workshop / high activity 16-18°C

─Turning down setpoint by 1°C could save circa 8%

• Locate thermostats carefully

─Not near doors

─Not in sun

Control heat gains

• In shops

─Large heat gains from display lightingand refrigeration

• In offices

─From occupants and electrical equipment

• In factories

─From processes such as cooking, welding

• In many lightweight buildings

─Solar gains through thin walls and glazing

De-stratification fans

• Useful for high ceiling premises with a large variation in temperature with height and a reasonably well insulated and air tight building

• Interlocked heating controls

• Fast opening roller-shutter doors

• Air curtains

• Flexible doors

Boiler replacement and fuel switching

Boiler replacement and fuel switching

• Understanding boiler efficiency

• Knowing when to upgrade your boiler

• Fuel switching and Renewable Heat Incentive (RHI)

Boiler Efficiencies

• Many SMEs use smaller domestic style boilers

• Check your boiler’s efficiency at www.ncm-pcdb.org.uk

• All new boilers have to be A-rated (>90% efficient)

• Any boilers pre 1997 are likely to be inefficient –consider replacing

Condensing Boilers

• Have the highest efficiencies (>92%)

• Recover extra heat from flue gases

• Operate at lower flow temperatures (may need larger radiators)

• Need careful installation in order to make sure they can operate in condensing mode

• Need a condensate drain

Understanding boiler efficiency

• What do we mean by boiler efficiency?

(The % of input energy (fuel) that is

output as useful heat)

• What is a good/bad efficiency rating?

Knowing when toupgrade your boiler

• How efficient is my boiler?

• Age?

• Condition? Maintenance Costs?

• Specialist analysis

Fuel switching

• Consider switching if you are using a high

price fuel such as oil (but has reduced

recently), LPG or electricity (day tariff).

• Alternatives are

• Natural gas

• Biomass

• Heat Pumps – Air, Ground or Water –

source.

Biomass

• Burns wood in one of three forms

• Logs (Large scale, low fuel costs)

• Chips

• Pellets (Smaller scale, higher fuel

cost)

• High level of automation

• Very low carbon factor

• If sustainable fuel!

Biomass– free procurement guide

Heat Pumps

• Air Source – coefficient of performance (COP)of 2 to 3

• Ground Source – COP of 3 to 5

• Move heat rather than

create it

Renewable Heat Incentive

• Government funded subsidy for renewable

heat projects

• Paid quarterly per kWh of heat produced

• Rate fixed at commissioning and then paid

for 20 years (index linked)

• Helps pay for higher costs of renewable

equipment

• Typical paybacks around 8-12 years

Hotel:Oil to biomass conversion

Installation of biomass boiler without RHI:

Cost of system = £110,000 Fuel saving = £5380 (£14,620 oil - £9,240 wood pellets)Payback = 20 years (£110,000/£5,380)

Installation of biomass boiler with RHI:

Cost of system = £110,000 Fuel saving = £5380 (£14,620 oil - £9,240 wood pellets)RHI (6.8p/kWh heat generated) = £11,615 (170,820 kWh X 6.8p)Payback period = 6.4 years (£110,000/(£5,380+£11,615)

Radiant Heat

• Heat surfaces not space

Exercise 2

Exercise 2 (15 minutes)

Your organisation has a gas boiler that was installed in 1990.

Your gas engineer estimates your boiler’s efficiency at 70%.

The engineer recommends upgrading to a gas condensing boiler with an efficiency of 92%, at a cost of £10k.

• How much energy and money would you save each year if you upgraded?

• How many years would it take to for the investment to be repaid?

Key information: Gas costs: £0.04/kWhCurrent annual gas consumption: 150,000 kWh

Exercise 2 – Helpful Hints

• Step 1 – Calculate current gas annual cost

─Annual cost [£] = Annual gas consumption [kWh] x Unit Cost [£/kWh]

• Step 2 – Calculate the current annual heating demand

─Annual heat demand = annual gas consumption [kWh] * Boiler Efficiency

• Step 3 – Calculate the new boiler consumption

─New Annual consumption [kWh] = Annual heat demand [kWh] / New Boiler Efficiency

• Step 4 Calculate the gas kWh saving, cost saving and payback

Exercise 2 - Answers

• Step 1 – Calculate current gas annual cost

─Annual cost [£] = Annual gas consumption [kWh] x Unit Cost [£/kWh]

£6000

• Step 2 – Calculate the current annual heating demand

─Annual heat demand = annual gas consumption [kWh] * Boiler Efficiency

105,000 kWh (so 45,000 kWh per annum is currently going up chimney!)

Exercise 2 - Answers

• Step 3 – Calculate the new boiler consumption

─New Annual consumption [kWh] = Annual heat demand [kWh] / New Boiler Efficiency

114,130 kWh

• Step 4 Calculate the gas kWh saving, cost saving and payback

35,870 kWh and £1,435 and 7 years

How much CO2?

Rule of thumb:

(see DECC carbon factors for exact conversion factors)

£100Saved on oil, gas or

electricity

500kg of CO2

0.5t of CO2

or~~

Making a business case

Two questions from your finance department/boss/MD:

1.How much is all this going to cost us?

2.When do we get our money back?

And the other questions they should be asking:

1. Any other H&S considerations

2. Any other benefits?

Building the business case

1. How much is all this going to cost us?

• Rough estimate – price books on the internet

• Resource Efficient Scotland or specialist survey

• Quotes from contractors or suppliers. Resource Efficient Scotland can help you to review quotes and any assumptions made

Building the business case

PAYBACK

INTERNAL RATE OF RETURN

NET PRESENT VALUE

2. When do we get our money back?

Building the business case

Building the business case: payback

Simple Payback Period:

• The amount of time in years that it takes for an investment to be repaid by the savings it achieves

• Ignores maintenance costs

• Ignores savings through improved longevity (as long as the payback period is less than the expected life of the equipment)

Building the business case: Net Present Value

Net Present Value:

• Better for large investment or longer term projects

• Sums the cash flows in each year

• Discounts the value of money in the future

Simple Payback =Period

Cost of measure

Savings achieved per annum

= X Years

Building the business case: payback

Building the business case: Net Present Value

• Useful for large investments and/or long payback periods

• Useful for comparing projects with different lifetimes

• Choose the number of years that you evaluate a project over

Year Cashflow YearDiscountedCashflow

Year 1 -6000 Year 1 -6000Year 2 1300 Year 2 1300

Year 3 1300 Year 3 1235Year 4 1300 Year 4 1173Year 5 1300 Year 5 1115

Year 6 1300 Year 6 1059Year 7 1300 Year 7 1006

Year 8 1300 Year 8 956

Year 9 1300 Year 9 908

NPV 2751

-£7,000

-£6,000

-£5,000

-£4,000

-£3,000

-£2,000

-£1,000

£-

£1,000

£2,000

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9

Discounted Cashflow

NPV

Building the business case: worked example

Existing New

Gas Cost £6,000 £4,250

Boiler Efficiency 70%(estimated)

92% quoted

Gas consumption 150,000 114,000

Heating Demand 105,000 105,000

Boiler cost £10,000

Gas unit cost £0.04 £0.04

SAVING £1440 + maintenance cost improvement

Simple Payback period 6.9 years

Replace gas boiler for a single-shift factory 50 wks/yr 5 days/wk

Improvement measure: Gas Boiler Replacement

• Rationale

• Description of the measure

• Costs including quotes

• Payback or NPV

• Any other benefits

• Any H&S considerations

Building the business case: summary

Get funding

• Advice and support on 0808 808 2268

• Free Guide ‘Sources of finance - How to fund your resource efficiency Projects’

• Upcoming webinar

Green Network for Businesses

• Opportunity to connect with a green business that has already implemented

• Help cut waste, water, energy and raw material costs

• More than 170 members

• Lead by example and showcase best practise

Green Network for Businesses

• Online search tool – find a business near you

• Read case studies and watch videos

• Book a visit

• Connect by phone/email

Heating –Member experiences

• Heat pumps, biomass and energy efficiency

• Range of sectors and locations

• Haldane – Fife─ Manufacturer of timber products

─ Lots of waste and a cold factory

─ Saving £4,000 per annum on energy bills

─ Saving £9,000 per annum on waste

─ RES SME loan

Heating –Member experiences

• Heather Hills Farm - Perth─ Freezing working conditions and rising energy bills

─ Polyurethane spray foam insulation

─ Double glazing

─ 18 KW wood-pellet boiler

• Film City – Glasgow─ Historic building, 25 tenants

─ 10 year energy bill predicted at £1million

─ Programme for Sustainability, ‘Green Wardens’

─ Mineral wool insulation

─ Insulating curtains

─ Zonal controls

─ Decrease in electricity usage, gas usage halved

Q&A and Next Steps

Q & A

Barriers to resource efficiency

Helping you overcome the barriers to resource efficiency

Helping you overcome the barriers to resource efficiency

Helping you overcome the barriers to resource efficiency

Helping you overcome the barriers to resource efficiency

Helping you overcome the barriers to resource efficiency

How much can you save?

£12,264 £15,992

£42,651

£26,788

£43,750

£39,183

£45,469

£60,930

<10 10 - 49 50 - 99 100 - 149 150 - 199 200 - 249 250 - 499 > 500

Average savings per business size

Number of employees

£19.5kAverage savings

per business

• Free online training for your environmental team

• Bite sized modules teach latest resource efficiency knowledge and practice

• Certificate on completion

• Ideal lunchtime learning

E-LEARNING Green Champions Training

'Great course for businesses that want to learn about resource efficiency at their own pace. I highly recommend this course”Seamus CorryAssistant Manager | Cloybank

The Resource Efficiency Pledge

Helping your business to plan, inspire and take action, so that you can reap the benefits of improved resource efficiency.

motivate your staff and senior management, and bolster their commitment to achieving your business’s environmental goals

focus your efforts on a clear set of achievable performance improvement actions

get the recognition you deserve from employees, customers and wider stakeholders

"By committing to a Resource Efficiency Pledge, we believe we will reduce our carbon emissions, costs and generally be a more sustainable

business.“ Richard Carr, | Webhelp UK

“The pledge will encourage us to keep our staff and clients engaged and inspire us to keep investigating best practice and new innovations.”

Sarah Potter | Film City Glasgow

How it works