Cost Analysis of Energy Usage at Shepherd Universityklaskey/Capstone/MSSEORProjectsSpring18/SUCBA/downloads/...Problem Statement Shepherd University currently has high utility costs

Cost Analysis of Energy Usage

at Shepherd University

Final Presentation

Omed Amin

Chris Hardy

Kathleen Yan

11 May 2018

1

Project Background

• Shepherd University

• Founded in 1871

• Shepherdstown, West Virginia

• 49 buildings varied in size, age, function,

and construction material

• Motivation

• High utility costs

• Not enough studies and strategic plans on campus wide energy conservation

• Interested in campus wide initiatives to reduce the total cost of energy usage

• Inspired by local county public K-12 schools

2

Problem Statement

Shepherd University currently has high utility costs totaling nearly $2 million a

year due to old buildings with outdated utility systems. Therefore, there is a need

for modern, more energy efficient utility systems to reduce annual utility costs.

The Operation & Facilities Department asked the team to perform a cost

analysis on various energy usage domains and recommend a solution. The

recommended solution must pay for its implementation cost and have the

greatest annual utility savings.

3

Project Objective and Scope

Objective: Study various energy conservation solutions and recommend

a solution to reduce the total cost of energy usage to Shepherd University,

including a cost analysis for each solution, detailing their implementation

costs, annual and long-term cost savings, and payback periods.

Scope: East Campus, 21 Buildings

Research Domains:

• Heating, Ventilation, and Air Conditioning (HVAC)

• Building Envelope (Windows, Air Sealings, Insulations)

• Lighting Loads

4

East Campus

Technical Approach 5

Phase 1

Data Collection: Compiled an overview of existing energy

solutions related to the 3 research domains. Identified

parameters to be used in the cost analysis.

Phase 2Cost Analysis: Examined each solution within the domains to

calculate initial implementation costs, annual utility savings, 20-

year cost savings, and simple payback periods.

Phase 3Decision Analysis: Compared solutions based on different

attributes to determine the best recommendation to Shepherd

University.

HVAC Cost Analysis Summary

• Only 4 buildings on East Campus need HVAC unit replacements.

• The analysis is based on replacing the existing HVAC units with 16 Seasonal Energy

Efficiency Ratio (SEER)1 rated units reducing utility costs by 50% annually.

6

1The SEER rating of a unit is the cooling output during a typical cooling-season divided by the total electric energy input during

the same period. The higher the unit's SEER rating the more energy efficient it is.

Implementation Costs ($):

• $13,200 per building, a fixed cost based on building

size

Annual Savings ($):

• Cost per 1 M British Thermal Units (BTUs) =

($0.11/Kwh * 293)

• BTUs required per building per month =

(Gross Area * 3,000) + 500,000

• Annual cost = 12 * Cost per 1 M BTUs * BTUs

required /1,000,000

• Savings = Annual cost - (Annual cost * % Saving)

Payback Period (yrs.):

Implementation Cost ($)

Annual Savings ($)

20-Year Cost Savings ($):

• Net cost saving in present

value using 2.02% real

interest rate

Building Envelope Summary

• White Roofs

o Painting roofs with reflective paint to save on

cooling costs

• Energy Efficient Windows

o Energy efficient windows are better at reflecting

sun and keeping conditioned air inside

• Air Sealing

o Using weather-stripping and caulking to close

holes where air leaks in and out of the building

• Insulation

o Increasing the thermal resistance of wall areas to

prevent heat and cold air from moving through

7

Calculating Cost Savings – Windows8

Assumptions:

• Electricity percent usage

breakdown

• Number of windows

Market Research:

• Window size

• Window area relative to building

size

• Parameter cost estimates

o Window price

o Labor cost per window

• Percentage savings

Provided Data:

• FY17 electricity costs per building

• Building gross area

Annual Savings ($):

• FY17 electricity cost($) * %

Usage of heating & AC *

%Savings

Implementation Costs ($):

• (Window Price ($) + Labor

Cost($)) * # of Windows

Payback Period (yrs.):

• Implementation Cost ($)

Annual Savings ($)

20-Year Cost Savings ($):

• Net cost saving in

present value using

2.02% real interest rate

Building Envelope Cost Summary

Solution

Total

Implementation

Cost ($)

Total Payback

Period (yrs.)

Total Annual

Utility Savings

($)

Total 20-year

Cost Saving ($)

Product Lifetime

(yrs.)

White Roof $853,821 26.79 $31,867 -$323,250 30

Energy Efficient

Windows$2,190,115 46.04 $47,573 -$1,398,049 25

Air Sealing:

Weather-Stripping$542,804 12.55 $43,248 $177,256 20

Air Sealing:

Caulking$286,811 8.84 $32,436 -$33,577 10

9

• Very costly. Payback period is more than

product lifetime.

• Best implemented when a building is under

construction for incremental cost savings.

Implementation

cost is counted

twice

The negative

value is due to

net present

value

Building Envelope: Insulation10

Wall

Area

(ft2)

Heating

Degree

Days (HDD)

Current Insulation

Thermal

Resistance

Future Insulation

Thermal

Resistance

$ per MBTUBTUs Saved

(Millions)

Annual

Savings

5000 5293 22 40 $32.23 12.99 $418.69

Diminishing returns due to not being

able to completely reduce heat flow

through a wall.

Adding insulation to areas where none

exists has greater cost and energy

savings than adding insulation to

already insulated areas.

Heat Flow = 1/R * Area * HDD * 24

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

0 5 10 15 20 25 30 35 40 45

HEAT FLOW

OVER A

HEATING

SEASON

(MBTUS)

THERMAL RESISTANCE, R

Lighting Analysis Summary

Analysis Area

• Replacing LED lightbulbs only and fixtures

• Interior lights and exterior lights

• Occupation sensors for traditional lights and LED lights

Analysis Focus

• 18 types of lightbulbs

• LED wattage equivalence and savings for each old lightbulb type

• Number of lightbulbs only and fixture + lightbulbs for each building by type

• Part and labor costs for LED lightbulbs and traditional lightbulbs

11

LED Total

Installment

Cost

LED Annual

Energy

Savings

LED Payback

Period (yrs.)

LED Life

Cycle (yrs.)

Old Life

Cycle

20-yr Old

Replacement

Cost

LED

Replacement

Cost

20-yr LED

Replacement

Cost

20 yr. Cost

Saving

$70,009 $8,156 6.80 10.20 1.28 $311,715 $67,740 $137,749 $309,762

Example of LED Cost Analysis 12

Marketing Research

Sponsor provided

$0.11/kwh 40,000 hrs.

lifetime

5,000 hrs.

lifetime

Present value using 2.02%

real interest rate.

Subtract diff. in LED and old

replacement cost

Cost Analysis Summary – East Campus13

Combined analysis for a

few promising solutions

The total annual savings of all individual solutions is 15% of current

annual utility cost of $2M.

Decision Analysis – Attributes and Weights14

Attribute Range Preferred Value Rank Weight

Implementation Cost (IC) $53,000 – $2,190,000 Lower 2 0.19

Payback Period (PP) 1 – 46 yrs. Lower 4 0.10

Annual Utility Savings (AS) $32,000 – $127,000 Higher 1 0.39

20-year Cost Savings (CS) $-1,398,000 – $3,684,000 Higher 3 0.13

Environment Benefits (EB) Low, Medium, High Higher 6 0.06

Ease of Implementation (EI) Easy, Medium, Hard Lower 5 0.08

Product Lifetime (PL) 10 – 30 yrs. Higher 7 0.06

Weights are calculated using rank reciprocal method: Consult with

Sponsor𝑊 =

1

𝑅𝑖

𝑖=1

71

𝑅𝑖

Decision Analysis – Ranked Solution

Solution Utility Score

LED + HVAC 0.82

LED + Occupation Sensors 0.73

HVAC + Occupation Sensors 0.71

LED 0.60

HVAC 0.51

Occupation Sensors 0.49

Air Sealing with Weatherstripping 0.41

Air Sealing with Caulking 0.38

Reflective Roof Painting 0.32

Energy Efficient Windows 0.15

15

Utility Score = 𝑊𝐼𝐶∗ 𝑈𝐼𝐶 +𝑊𝑃𝑃 ∗ 𝑈𝑃𝑃 +𝑊𝐴𝑆 ∗ 𝑈𝐴𝑆 +𝑊𝐶𝑆 ∗ 𝑈𝐶𝑆 +𝑊𝑃𝐿 ∗ 𝑈𝑃𝐿 +𝑊𝐸𝐵 ∗ 𝑈𝐸𝐵 +𝑊𝐸𝐼 ∗ 𝑈𝐸𝐼

Recommended

solution

𝑈(𝑥) =𝐻𝑖𝑔ℎ − 𝑥

𝐻𝑖𝑔ℎ − 𝐿𝑜𝑤

𝑈(𝑥) =𝑥 − 𝐿𝑜𝑤

𝐻𝑖𝑔ℎ − 𝐿𝑜𝑤

where High represents the maximum

value, Low represents the minimum

value, and x represents the value that

is being assessed for a given attribute.

Sensitivity Analysis – Weights 16

AttributesOriginal

Rank

New

Rank

Implementation Cost (IC) 2 2

Payback Period (PP) 4 4

Annual Utility Savings (AS) 1 3

20-year Cost Savings (CS) 3 1

Environment Benefits (EB) 6 4

Ease of Implementation

(EI)5 4

Product Lifetime (PL) 7 4

• LED + HVAC and LED + Sensor are tied in

utility score

• LED has a higher utility score than Sensor +

HVAC

Solution Utility Score

LED + HVAC 0.79

LED + Occupation Sensors 0.79

HVAC + Occupation Sensors 0.64

LED 0.68

HVAC 0.57

Occupation Sensors 0.53

Air Sealing with Weatherstripping 0.47

Air Sealing with Caulking 0.46

Reflective Roof Painting 0.40

Energy Efficient Windows 0.13

Sensitivity Analysis – Cost

Increase / decrease costs by 20% for each solution while others remain constant

17

Solution Cost Change Results

HVAC Increase/decrease implementation cost by 20% No change on any solution ranking

LED Increase/ decrease parts + labor cost by 20% No change on any solution ranking

Sensor Increase/ decrease parts + labor cost by 20% No change on any solution ranking

Electricity

Rate Increase by 20% No change on any solution ranking

Electricity

Rate

Decease by 20% Solution ranking of HVAC + Occupation

Sensors overtook LED + Occupation Sensors

Solution ranking is not sensitive to varying implementation cost by ± 20% since the

annual utility savings has the highest weight.

Recommendations

• A combination of replacing traditional lights with LED lighting and upgrading HVAC

units provides the best overall benefits based on our cost and decision analysis.

o It satisfies all requirements of the University.

o It requires a total implementation cost of $893,000 with payback period of 7 years.

o It has the highest annual utility savings of $127,000.

o It is expected to yield $3.6 million cost savings in a 20-year period measured in

present value.

o LED lights are expected to last for 13 years and HVAC for 20 years.

o It is robust to sensitivity analysis.

18

Assumptions and Limitations

• Extrapolation based on building size and type was used to allocate

electricity cost to buildings with missing data.

• Only open source information was used for cost analysis parameters.

• Savings estimates did not take into account all characteristics of each

individual building.

19

Future Work / Improvement

• More accurate assessment on light usage (hours of usage per day, days of

year, percent of lights in use, etc.) and building conditions

• More market research on labor and part costs

o Getting estimates from local contractors

• Including maintenance cost in the cost analysis

• Research additional energy conservation solutions

o Renewable energy (e.g. wind, solar, etc.)

o Plug loads and better user policies

20

Deliverables

• A final report documenting results, analysis details, and all supporting data.

• A single spreadsheet with linked sheets and cells

o A brief user manual

o Areas to change attribute rankings

o A single sheet to change all calculation parameters including assumptions, parts

and labor costs

o A summary of all solutions

o A building-wide summary of each solution

o Supporting calculation sheets

• A website available for external access, describing the project and providing

to project proposal, final report, and final presentation.

21

Acknowledgement

Special Thank You!

Sponsor - Shepherd University

• Mr. Eric Shuler

• Mr. Dustin Robins

George Mason University - SEOR Department

• Dr. Kathryn Laskey

22

Questions

23

Backup Slides

24

Management Information – Roles

Omed Amin

• Project Management (Schedule)

• Data Analysis

• HVAC Cost Analysis

• Decision Analysis

Chris Hardy

• Communications Management

• Data Analysis

• Building Envelope Cost Analysis

• Website Development

Kathleen Yan

• Project Management (Deliverables)

• Data Analysis

• Lighting Cost Analysis

• Decision Analysis

25

Management Information – Schedule 26

Management Information – EVM Chart27

Overall, we are on scheduled as planned.

Calculating LED Cost Savings28

Provided Data:

• East campus building profile

• Lightbulb type, wattage

usage, counts, LED

replacements in each

building

Marketing Research:

• Parts & labor cost for each

lightbulb type

• LED and old lightbulb

lifecycle

• Electricity Cost

• Long term interest discount

rate

Assumptions:

• Building operational hours per

day, days per year

• Percent of lightbulbs in each

building

Old & LED lightbulb

wattage usage per

building by type

LED annual

energy savings

per building

Old & LED lightbulbs

installation &

replacement cost per

building by type

Old & LED lifecycle

per building based on

usage 20-yr LED cost

savings on East

Campus

LED initial

installation cost

LED & Old 20-yr

replacement cost

Payback period

20-yr net cost

saving in present

value per building

Cost Analysis – LED29

Building NameImplementation

Cost ($)

Payback

Period (yr.)

Annual Utility

Savings ($)

20-year Cost

Saving ($)

Product

Lifetime (yr.)

Boone Field House $28,198 15.45 $1,261 $45,082 23.81

Byrd Center $147,669 8.63 $11,926 $404,475 14.17

Dining Hall $31,912 8.21 $2,609 $138,853 10.20

Entler Weltheimer House $15,695 6.49 $1,588 $77,154 10.20

Erma Ora Byrd Hall $73,097 13.14 $4,118 $167,444 12.15

Facilities Management $13,044 5.55 $1,577 $64,988 10.20

Gardiner Hall $45,032 5.23 $6,266 $164,715 12.96

Human Resources $9,965 8.16 $816 $30,112 13.89

Ikenberry Hall $43,959 8.16 $3,600 $132,831 13.89

Kenamond Hall $38,895 4.04 $6,847 $172,270 12.96

Knutti Boiler House $1,620 6.42 $211 $4,858 10.20

Knutti Hall $66,458 7.54 $6,051 $241,539 12.15

McMurran Hall $10,237 8.16 $838 $30,934 13.89

Reynolds Hall $9,194 7.43 $852 $33,350 12.15

Scarborough Library $70,009 6.04 $8,156 $309,762 10.20

Synder Hall $30,879 8.55 $2,470 $109,985 12.15

Student Center $52,680 6.43 $5,547 $245,145 10.20

Stutzman-Slonaker Hall $51,965 7.94 $4,360 $198,749 12.15

Turner Hall $49,176 8.28 $4,328 $138,419 12.96

White Hall $50,270 7.60 $4,333 $200,928 12.15

Total/Average $839,955 10.80 $77,754 $2,911,594 13

Cost Analysis – Occupation Sensors30

Cost Analysis – LED + Sensors31

Cost Analysis – HVAC 32

Building NameImplementation

Cost ($)

Payback

Period (yr.)

Annual Utility

Savings ($)

20-year Cost

Saving ($)

Product

Lifetime (yr.)

Boone Field House

Byrd Center

Dining Hall $13,200 0.49 $13,537 $212,192 20

Entler Weltheimer House

Erma Ora Byrd Hall

Facilities Management

Gardiner Hall $13,200 0.34 $19,412 $310,009 20

Human Resources

Ikenberry Hall $13,200 0.49 $13,399 $209,893 20

Kenamond Hall

Knutti Boiler House

Knutti Hall

McMurran Hall $13,200 2.07 $3,195 $39,989 20

Reynolds Hall

Scarborough Library

Synder Hall

Student Center

Stutzman-Slonaker Hall

Turner Hall

White Hall

Total/Average $52,800 1.07 $49,544 $772,083 20

Cost Analysis – Reflective Roof Painting33

Building NameImplementation

Cost ($)

Payback

Period (yr.)

Annual Utility

Savings ($)

20-year Cost

Saving ($)

Product

Lifetime (yr.)

Boone Field House $24,965 26.11 $956 -$9,046 30

Byrd Center $78,400 8.50 $9,218 $75,083 30

Dining Hall $100,800 102.86 $980 -$84,483 30

Entler Weltheimer House

Erma Ora Byrd Hall $48,082 15.32 $3,138 $4,163 30

Facilities Management $27,440 163.31 $168 -$24,642 30

Gardiner Hall $46,614 27.75 $1,680 -$18,643 30

Human Resources $14,560 110.67 $132 -$12,370 30

Ikenberry Hall $33,600 86.04 $391 -$27,098 30

Kenamond Hall

Knutti Boiler House

Knutti Hall $78,400 44.30 $1,770 -$48,934 30

McMurran Hall $15,120 27.02 $560 -$5,804 30

Reynolds Hall $10,640 20.96 $508 -$2,187 30

Scarborough Library $128,800 102.75 $1,254 -$107,930 30

Synder Hall $44,800 13.02 $3,442 $12,504 30

Student Center $89,600 19.69 $4,550 -$13,837 30

Stutzman-Slonaker Hall $56,000 133.18 $420 -$48,999 30

Turner Hall

White Hall $56,000 20.73 $2,701 -$11,027 30

Total/Average $853,821 26.79 $31,867 -$323,250 30

Cost Analysis – Energy Efficient Windows34

Building NameImplementation

Cost ($)

Payback

Period (yr.)

Annual Utility

Savings ($)

20-year Cost

Saving ($)

Product

Lifetime (yr.)

Boone Field House $44,580 31.23 $1,427 -$20,816 25

Byrd Center $280,185 20.36 $13,762 -$51,057 25

Dining Hall $115,840 79.18 $1,463 -$91,482 25

Entler Weltheimer House

Erma Ora Byrd Hall $171,725 36.66 $4,684 -$93,731 25

Facilities Management $49,330 196.66 $251 -$45,154 25

Gardiner Hall $166,475 66.38 $2,508 -$124,718 25

Human Resources $25,990 132.33 $196 -$22,720 25

Ikenberry Hall $114,650 196.66 $583 -$104,943 25

Kenamond Hall

Knutti Boiler House

Knutti Hall $177,495 67.18 $2,642 -$133,507 25

McMurran Hall $26,700 31.96 $835 -$12,792 25

Reynolds Hall $24,225 31.96 $758 -$11,606 25

Scarborough Library $368,005 196.66 $1,871 -$336,849 25

Synder Hall $104,610 20.36 $5,138 -$19,063 25

Student Center $249,030 36.66 $6,793 -$135,926 25

Stutzman-Slonaker Hall $123,450 196.66 $628 -$112,998 25

Turner Hall

White Hall $147,825 36.66 $4,032 -$80,686 25

Total/Average $2,190,115 46.04 $47,573 -$1,398,049 25

Cost Analysis - Air Sealing with Caulking35

Cost Analysis – Air Sealing with Weatherstripping36