Screening Analysis for EPACT-Covered Commercial

HVAC and Water-Heating Equipment

Volume 1- Main Report

April 2000

Office of Building Technology, State and Community Programs

Office of Energy Efficiency and Renewable Energy

U.S. Department of Energy

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Contents

1.0 Introduction ......................................................................................................................... 1.1

1.1 Scope of the Analysis ............................................................................................................ 1.3

1.2 Methodology Overview ........................................................................................................ 1.5

2.0 Engineering Analysis ............................................................................................................ 2.1

2.1 Engineering Approach .......................................................................................................... 2.1

2.2 Annual Building and Equipment Space-Heating and -Cooling Loads ....................................... 2.3

2.3 Translation of Annual Loads to Annual Energy Use ................................................................ 2.3

2.4 Representative Building Types .............................................................................................. 2.5

2.5 Climate Locations for the BLAST Simulation......................................................................... 2.6

2.6 Building Heating, Cooling , and Water-Heating Loads ............................................................. 2.6

2.6.1 Building Space-Heating and Space-Cooling Loads.......................................................... 2.7

2.6.2 SWH Loads and Equipment Sizing ................................................................................. 2.8

2.7 Mapping EPCA Equipment Categories to ASHRAE/Industry Equipment Categories ................ 2.8

2.8 Lifetime, Shipment, Baseline Cost, and Relative Cost Data ................................ ................... 2.10

2.8.1 Distribution Chain and Pricing for HVAC/SWH Equipment .......................................... 2.10

2.8.2 Efficiency and Cost Data - Cooling Equipment ............................................................. 2.12

2.8.3 Efficiency and Cost Data - Packaged Boilers ................................................................ 2.18

2.8.4 Efficiency and Cost Data - Warm-Air Furnaces ............................................................ 2.21

2.8.5 Efficiency and Cost Data - Service Water Heaters ......................................................... 2.26

3.0 Energy Savings and Economic Impact Analysis...................................................................... 3.1

3.1 Overview of Methodology ..................................................................................................... 3.1

3.2 Data and Key Assumptions ................................................................................................... 3.2

3.2.1 Energy Prices ........................................................... ..................................................... 3.3

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3.2.2 Energy Conversion Factors ........................ .................................................................... 3.4

3.2.3 Discount Rate .................................... ........................................................................... 3.5

3.2.4 Shipment Forecasts ....................................................................................................... 3.5

3.2.5 Equipment Price Markups .............................................................................................. 3.5

3.3 National Energy Consumption and Energy Savings ................................................................. 3.5

3.3.1 Methodology ................................................................................................................ 3.6

3.3.2 Energy Savings Results ................................................................................................. 3.7

3.3.3 Estimates of National NPV .......................................................................................... 3.11

3.4 Life-Cycle Cost Analysis .................................................................................................... 3.15

3.4.1 Market Segment to National Average Results ................................................................ 3.16

3.4.2 Methodology Used to Compute National NPV .............................................................. 3.20

3.5 Reductions in Environmental Emissions ............................................................................... 3.21

3.6 Summary of Results............................................................................................................ 3.23

4.0 References ........................................................................................................................... 4.1

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Figures

Figure 2.1. Proposed Process for Estimating the Weighted FLEOH .................................................... 2.4

Figure 2.2. U.S. Map Showing 11 Climate Locations (cities) and Corresponding Climate Regions....... 2.6

Figure 2.3. Equipment Distribution Chain ...................................................................................... 2.10

Figure 3.1. Overview of the Energy Savings and Economic Analysis Methodology ............................. 3.2

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Tables

Table 1.1. Commercial Equipment Product Categories: Air Conditioners (AC) ................................... 1.2

Table 1.2. Commercial Equipment Product Categories: Furnaces, Boilers, and Storage Water Heaters 1.3

Table 1.3. Characteristics of Certain Products Analyzed in Screening Analysis ................................... 1.4

Table 1.4. Characteristics of Certain Products Not Analyzed in Screening Analysis ............................ 1.4

Table 2.1. Energy Consumption by Principal Building Activity ......................................................... 2.5

Table 2.2. Building Service Water Heater Load Parameters by Building Type .................................... 2.9

Table 2.3. Cooling Equipment Annual Shipment Data Used in the Screening Analysis ...................... 2.13

Table 2.4. Cooling Equipment Baseline Cost Data .......................................................................... 2.15

Table 2.5. 1999 Contractor Cost Data for Cooling Products by Efficiency Level ............................... 2.17

Table 2.6. Estimated Annual Shipments for Gas-Fired Boilers Used in the Analysis .......................... 2.19

Table 2.7. Boiler Baseline Cost Data .............................................................................................. 2.20

Table 2.8. Gas-Fired Boiler Efficiencies Analyzed (with relative cost above baseline) ....................... 2.22

Table 2.9. Cost Estimates for Gas-Fired Boilers .............................................................................. 2.22

Table 2.10. ARI 1998 Statistical Profile for Year Round Units ......................................................... 2.24

Table 2.11. Standard 90.1 Furnace Design Options ......................................................................... 2.25

Table 2.12. Relative Cost and Efficiency Data for Furnace Screening Analysis ................................. 2.26

Table 2.13. Contractor Costs for Furnace Efficiency Levels Analyzed .............................................. 2.26

Table 2.14. Total Gas and Electric Commercial Water Heater Shipments ......................................... 2.27

Table 2.15. Commercial Water Heater Shipment Proportions and Estimated Shipments .................... 2.28

Table 2.16. Baseline Gas Storage Water Heater Costs ..................................................................... 2.29

Table 2.17. Baseline Gas Instantaneous and Electric Water Heater Costs .......................................... 2.30

Table 2.18. Water Heater Efficiency Levels and Contractor Costs Used in Screening Analysis ............ 2.1

Table 3.1. Electricity and Gas Prices Used for Screening Analysis ..................................................... 3.4

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Table 3.2. National Baseline Energy Consumption and Energy Savings - Space-Cooling Equipment...3-8

Table 3.3. National Baseline Energy Consumption and Energy Savings - Space-Heating Equipment ...3-9

Table 3.4. National Baseline Energy Consumption and Energy Savings - Water-Heating Equipment. 3-10

Table 3.5. NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Space-Cooling Equipment.... 3.11

Table 3.6. NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Space-Heating Equipment .... 3.12

Table 3.7. NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Water-Heating Equipment.... 3.13

Table 3.8. Market Segment Weighted LCC for All Efficiency Levels - Space-Cooling Equipment .... 3.15

Table 3.9. Market Segment Weighted LCC for All Efficiency Levels - Space-Heating Equipment..... 3.16

Table 3.10. Market Segment Weighted LCC for All Efficiency Levels - Water-Heating Equipment... 3.16

Table 3.11. Energy Savings and Carbon Reductions from Adopting ................................................. 3.22

Table 3.12. Aggregated Energy Savings and NPV for Efficiency Levels with Maximum NPV........... 3.20

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1.0 Introduction

The Energy Policy and Conservation Act (EPCA) (P.L. 94-163) as amended by the Energy Policy Act

of 1992 (EPACT) (P.L. 102-486), establishes a role for the U.S. Department of Energy (DOE) to regulate

efficiency levels of certain categories of commercial heating, cooling, and water-heating equipment.

Initial minimum efficiency levels for products falling under these equipment categories were established

in EPACT (Tables 1.1 and 1.2), based on the requirements contained in ASHRAE/IES Standard 90.1-1989

(ASHRAE 1989). EPCA(a) requirements state that, if the American Society of Heating, Refrigerating and

Air-Conditioning Engineers, Inc. (ASHRAE) amends efficiency levels prescribed in Standard 90.1-1989,

then DOE must establish an amended uniform national manufacturing standard at the minimum level

specified in amended Standard 90.1. However, DOE can establish higher efficiency levels if it can show

through clear and convincing evidence that a higher efficiency level, that is technologically feasible and

economically justified, would produce significant additional energy savings.

On October 29, 1999, ASHRAE approved the amended Standard 90.l,(b) which increases the

minimum efficiency levels for some of the commercial heating, cooling, and water-heating equipment

covered by EPCA 92. DOE has conducted a screening analysis to determine the energy-savings potential

of the efficiency levels listed in Standard 90.1-1999. The analysis estimates the annual national energy

consumption and the potential for energy savings that would result if the EPACT-covered products were

required to meet these efficiency levels. The analysis also estimates additional energy-savings potential

for the EPACT-covered products if they were to exceed the efficiency levels prescribed in Standard

90.1-1999. In addition, a simple life-cycle cost (LCC) analysis was performed for some alternative

efficiency levels. This report describes the methodology, data assumptions, and results of the analysis.

Section 2.0 includes a detailed description of the engineering approach used in the analysis, including

the data and cost versus efficiency curves. The methodology used for national energy-savings impacts,

LCC, and national economic impacts is described in Section 3.0. The energy savings, LCC, and net

present value (NPV) results for the various cooling, heating, and water-heating products are also presented in Section 3.0. Section 4.0 is a list of references cited in this report. The details of the building

characteristics data used in the BLAST simulations (Building Loads and System Thermodynamics) and

for the water-heating analysis for each of the representative building types is presented in Appendix A.

Appendix B describes the methodology used to aggregate the engineering results for specific locations

(cities) to a national level. Appendix C contains instructions on how to use the analysis spreadsheet

(a) In this document, EPCA, as amended by EPACT, is often referred to as "EPCA 92."

(b) On June 24, 1999, ASHRAE's Board of Directors provisionally approved revisions to ASHRAE/IES

Standard 90.1, subject to a formal appeal process. Four appeals were filed, and an Appeals Hearing

was held on October 9, 1999. The Appeals Panel recommended that the appeals be dismissed, and

the ASHRAE Board approved the Appeals Panel report in a special meeting on October 29, 1999,

thus concluding ASHRAE's process for amending the standard. The commercial HVAC equipment

efficiencies contained in ASHRAE/IESNA Standard 90.1-1999 will become effective on October 29,

2001, two years after final ASHRAE approval.

1.1

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developed for the screening analysis. Appendix D lists one-page summary results for all the products

(cooling, heating, and water heating) analyzed in the screening analysis.

Table 1 .1. Commercial Equipment Product Categories: Air Conditioners (AC)

and Heat Pumps (HP) (EPCA [as amended] Sections 342 (a) (1), (2), and (3))

Equipment Equipment EPCA Efficiency Levels

Category Subcategory EPCA Section Date EPCA 92 90.1-1999

Small Commercial AC/HP <65 kBtu/h Cooling Eff. 1/1/94 SEER 10.0 SEER 10.0

Packaged Air- Air-Cooled 3-Phase, 342(a)(1)(A) HSPF 6.8 HSPF 6.8

Conditioning and Central-Split System Heating Eff.

Heating Equipment 342(a)(1)(D)

AC/HP <65 kBtu/h Cooling Eff. 1/1/94 SEER 9.7 SEER 9.7

Air-Cooled 3-Phase, 342(a)(1)(B) HSPF 6.6 HSPF 6.6

Central-Single Package Heating Eff.

342(a)(1)(E)

AC/HP 65-135 kBtu/h Cooling Eff. 1/1/94 EER 8.9 EER 10.3

Air-Cooled Central 342(a)(1)(C) COP 3.0 COP 3.2

Heating Eff.

342(a)(1)(F)

AC/HP <65 kBtu/h Cooling Eff. 1/1/94 EER 9.3 EER 12.1

Water-Cooled 342(a)(1)(G) COP 3.8 COP 4.2

Evap. Cooled Heating Eff.

Water-Source Central Water-Source only

342(a)(1)(1)

AC/HP 65-135 kBtu/h Cooling Eff. 1/1/94 EER 10.5 EER 11.5

Water-Cooled 342(a)(1)(H) COP 3.8 COP 4.2

Evap. Cooled Heating Eff.

Water-Source Central Water-Source only

342(a)(1)(I)

Large Commercial AC/HP 135-240 kBtu/h Cooling Eff. 1/1/95 EER 8.5 EER 9.7

Packaged Air- Air-Cooled Central 342(a)(2)(A) COP 2.9 COP 3.1

Conditioning and Heating Eff.

Heating Equipment 342(a)(2)(B)

AC/HP 135-240 kBtu/h Cooling Eff. 1/1/95 EER 9.6 EER 11.0

Water-Cooled 342(a)(2)(A)

Evap. CooledCentral No Heating Eff.

Requirement

Packaged Terminal PTAC/PTHP Cooling Eff. 1/1/94 EER and COP EER and COP

Air Conditioners and Air-Cooled 342(a)(3)(A) vary by capacity vary by capacity

Heat Pumps Heating Eff. (different

342(a)(3)(B) formulas)

1.2

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Table 1.2. Commercial Equipment Product Categories: Furnaces, Boilers, and Storage Water Heaters

(EPCA [as amended] Sections 342 (a) (4), and (5))

Equipment Equipment EPCA Efficiency Levels

Category Subcategory EPCA Section Date EPCA 92 90.1-1999

Warm-Air >225 kBtu/h Gas Fired Eff. 1/1/94 Thermal Efficiency Thermal Efficiency

Furnaces Gas-Fired 342(a)(4)(A) 80% Gas 81% Oil 80% Gas 81% Oil

Oil-Fired Oil Fired Eff.

342(a)(4)(A)

Package Boilers >300 kBtu/h Gas Fired Eff. 1/1/94 Combustion Efficiency Combustion Efficiency

Gas-Fired Oil- 342(a)(4)(C) 80% Gas 83% Oil 80% Gas 83% Oil

Fired Oil Fired Eff.

342(a)(4)(D)

Storage Water Electric Standby Loss 1/1/94 0.3 + 27/Va 20 + 354V

Heaters 342(a)(5)(A)

<155 kBtu/h Thermal Eff. and 1/1/94 Thermal Eff. 78% Thermal Eff. 80%

and V<_ 140 gal Standby Loss Standby Loss Varies Standby Loss Varies by

342(a)(5)(B) by Volume Volume

>155 kBtu/h Thermal Eff. and 1/1/94 Thermal Eff. 78% Thermal Eff. 80%

and V<_140 gal Standby Loss Standby Loss Varies Standby Loss Varies by

342(a)(5)(C) by Volume Volume

Instantaneous V<10 gal Thermal Ef£ 1/1/94 Thermal Eff. 80% Thermal Eff. 80%

Water Heaters Instantaneous 342(a)(5)(D)

10 gal <V Thermal Eff. and 1/1/94 Thermal Eff 77% Thermal Eff. 80%

<140 gal Standby Loss Standby Loss Varies Standby Loss Varies by

Instantaneous 342(a)(5)(E) by Volume Volume

Storage Tanks V >140 gal Heat Loss 1/1/94 Heat Loss 6.5 Btu/h•ft2 Heat Loss 6.5 Btu/h•ft2

Unfired 342(a)(5)(F)

Storage Water Prescriptive 1/1/94 R-12.5, III) R-12.5, IID

Heaters and 342(a)(5)(G)

Storage Tanks

>140 gal

1.1 Scope of the Analysis

The screening analysis examined the efficiency levels specified in EPCA and Standard 90.1-1999 for

the EPACT-covered equipment, as well as more efficient levels, including those associated with the most

efficient products available in the market. For each level above the EPCA standard, the following were

estimated:

1. the incremental national energy and carbon emission savings that would result from a standard set at

that level

2. the NPV that would result from a standard set at that level, as compared with the corresponding

Standard 90.1-1999 and EPCA standards.

1.3

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Table 1.3. Characteristics of Certain Products Analyzed in Screening Analysis

Equipment Type Size Category

Performance

Characteristic Analyzed

3-Phase, Single-Package, Air-Source AC

3-Phase, Split-System, Air-Source AC

3-Phase, Single-Package, Air-Source HP <65 kBtu/h

cooling performance only

3-Phase, Split-System, Air-Source HP cooling performance only

Central, Air-Source AC

Central, Air-Source HP cooling performance only

Central, Water-Source HP ?65 kBtu/h and <135 kBtu/h cooling performance only

Central, Water-Cooled AC

Central, Air-Source AC

Central, Air-Source HP >_135 kBtu/h and <240 kBtu/h cooling performance only

Central, Water-Cooled AC

Central, Water-Cooled AC <65 kBtu/h

Central, Water-Source HP <17 kBtu/h cooling performance only

Central, Water-Source HP 17 kBtu/h and <65 kBtu/h cooling performance only

Packaged Terminal Air Conditioners (PTACs)

Packaged Terminal Heat Pumps (PTHPs) cooling performance only

Small Gas-Fired Steam Boilers <2,500 kBtu/h

Large Gas-Fired Steam Boilers >2,500 kBtu/h

Large Gas-Fired Hot Water Boilers >2,500 kBtu/h

Gas-Fired Warm-Air Furnaces >225 kBtu/h

Gas Storage Water Heaters >155 kBtu/h

Gas Storage Water Heaters <_155 kBtu/h

Electric Water Heaters >12kW

Gas-Fired Tankless Instantaneous Water Heaters

Gas-Fired Instantaneous Water Heaters with Tanks

Table 1.4. Characteristics of Certain Products Not Analyzed in Screening Analysis

Equipment Type Size Category

Performance Characteristic No

Analyzed

3-Phase, Single-Package, Air-Source HP heating performance

3-Phase, Split-System, Air-Source HP <65 kBtu/h

heating performance

Central, Air-Source HP >_135 kBtu/h and <240 kBtu/h heating performance

Central, Air-Source HP >_65 kBtu/h and <135 kBtu/h heating performance

Central, Water-Source HP <135 kBtu/h heating perforinance

PTHP heating perforinance

Water-Source HP >_135 kBtu/h and <240 kBtu/h

Evaporative l Cooled Products

Oil-Fired Warm-Air Furnaces >225 kBtu/h

Oil-Fired Storage Water Heaters <155 kBtu/h

Oil-Fired Storage Water Heaters >155 kBtu/h

Oil-Fired Instantaneous Water Heaters with Tanks

Oil-Fired Small Boilers <2,500 kBtu/h

Oil-Fired Large Boilers >2,500 kBtu/h steam and hot water

Tankless Oil-Fired Instantaneous Water Heaters

1.4

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These products were excluded because of insufficient data describing baseline energy consumption

and cost-efficiency relationships, a small market for the products or lack of product shipment data, or, for

heating performance of air-source heat pumps , absence of a suitable methodology to discriminate their

heating function from that of supplemental heat sources with which they are often used.

1.2 Methodology Overview

This section provides an overview of the methodology used for the screening analysis (with

additional details provided in subsequent sections ), which was divided into five steps:

1. Engineering Analysis

2. National Energy Impacts

3. National Economic Impacts

4. Life-Cycle Cost (LCC) Analysis

5. National Emissions Reductions

The energy end-uses for the various cooling , heating, and water-heating equipment categories at

several different efficiency levels were estimated using a full-load equivalent operating hour (FLEOH)

approach. The details of the engineering analysis are provided in Section 2.0.

The magnitude of heating, ventilating, and air-conditioning (HVAC) and service water-heating

(SWH) loads imposed on equipment depends on the physical and operational characteristics of the

building in which the equipment is used, as well as the prevailing climatic conditions . To capture this

variation of equipment energy use, coil loads for 7 representative building types at 11 climate locations

were estimated, based on a whole-building simulation. Details of this process are presented in

Section 2.0. The mapping of the building loads to normalized equipment loads (for a particular

equipment size) using a FLEOH approach is also addressed.

For each equipment category , the energy usage of a given piece of equipment was estimated based on

a characteristic equipment size for each combination of representative building type and climate location.

The unit energy use was estimated using FLEOH and adjusted for each nominal equipment efficiency

level being considered.

The national energy impacts of higher efficiency equipment were estimated by 1) mapping climate

locations onto regions and 2 ) estimating the fraction of each year's national equipment shipments (by

product category) within market segments, as defined by a representative building type within a particular

region of the United States. Because detailed statistical information related to where and in what types of

buildings the equipment is currently being installed is generally unavailable, an allocation process was

developed. The estimated allocation of national shipments to market segments was primarily based on

information from the Commercial Building Energy Consumption Survey (CBECS) (EIA 1992, 1995)

related to floor space and saturations of generic equipment types for each market segment. National

energy consumption for each equipment category was then estimated at each efficiency level by

multiplying the annual unit energy use in each market segment with the annual shipments expected for

that market segment.

1.5

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The LCC analysis was conducted at the market segment level with region-specific energy prices; and

thus provides some insight on the distribution of LCC cost savings across the building population.

National NPV was calculated as a summary metric of the total national economic impact due to any

chosen level of efficiency standard. This metric combines the influence of the LCC savings per unit, as

well as the projected volume of shipments in each equipment category. This process is explained in more

detail in Section 3.0, as well as the national emissions reductions that can be achieved by adopting higher

efficiency level.

1.6

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2.0 Engineering Analysis

This section describes the engineering approach used in the screening analysis. A discussion on how

the space-heating, space-cooling, and water-heating loads were generated is presented . The method for

selecting representative building types and climate locations used for the analysis and the basis for their

selection are then described , followed by the approach used to estimate the equipment loads and annual

energy use . Finally, the cost data, including the first cost and equipment cost versus efficiency for each of

the products analyzed and the sources of the information , are provided.

2.1 Engineering Approach

The annual load and energy use for the various EPACT-covered heating , cooling, and water -heating

products at different efficiency levels were estimated for the analysis using a FLEOH approach. The

FLEOH is effectively the number of hours that a system would have to run at full capacity to serve a total

load equal to the annual load on the equipment. FLEOH is calculated as:

FLEOH = Annual Load

Equipment Capacity

FLEOH is strictly defined as being related to the equipment capacity , not the peak load on the system.

Because FLEOH is used to generate annual heating and cooling loads irrespective of equipment size, an

assumption is required on how the equipment is typically sized that must be used consistently . For this

analysis, the assumption was that the equipment is sized based on the design -day peak equipment load

with no explicit oversizing:

Equipment Capacity = Design Day Peak Load (2.2)

Substituting Equation (2.1) into Equation (2.2) yields:

FLEOH = Annual Load (2

. 3)

Design Day Peak Load

The FLEOH for a piece of equipment is a function of the relative annual load to the peak building

load. In general, this ratio will vary depending on building construction, building internal loads, building

schedules, and orientation and exposure of the zone that the equipment serves. It was assumed that for

any given building type, the internal-load characteristics and building schedules are constant across the

building.

The FLEOH represents a simplified approach for estimating energy use . The efficiency level analysis

is based on the rated efficiency at the rated conditions [e.g., the energy efficiency ratio (EER) rating for

commercial packaged cooling equipment] as a proxy for equipment efficiency . For example,

2.1

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improvements in rated EER can come from several design modifications, including more efficient

compressor designs, better heat transfer characteristics of the coils, improved refrigerants, or reduced fan

energy requirements. The EER may not reflect efficiency improvements from some design options or

control strategies used to enhance the part-load or off-design performance, such as a multiple-compressor

system designed to improve part-load performance.

The design changes that enhance full-load performance will generally improve part-load efficiency;

thus, improvements in full-load efficiency ratings can be used in estimating a minimum improvement in

average annual efficiency for a product.

Three general caveats should be noted with regard to the FLEOH approach. First, the approach does

not directly address the off-design performance. Second, accuracy decreases when assessing equipment

energy uses that do not scale with the load on the equipment; e.g., the supply fan energy use in packaged

cooling equipment, or the standby loss inherent in a water heater or a boiler. Third, the approach does not

address cycling losses in equipment.

For cooling equipment, the condenser performance (COP) generally increases at off-design

performance. However, this fact is mitigated by the cycling losses that tend to occur in actual use and by

the fact the fan energy use is relatively constant.

A review of package system annual average EER data from simulations of actual cooling systems by

Barwig et al. (1996) showed no consistent pattern as to whether the annual efficiency of packaged airconditioning equipment in a typical building application was over- or under-represented. Annual average

EER variations of -14% to +12% of the nominal EER rating were seen across the building types and

locations modeled.

For boilers and furnaces, the FLEOH approach may somewhat underestimate the annual energy used

in the equipment. For furnaces, the effect is small because the losses during the off-cycle periods are

small, and much of the heat remaining in the heat exchanger during the off-cycle will be picked up in the

building air stream, at least during periods of occupancy.

For boilers, the total annual standby loss is largely a function of the period available for operation

(hot standby period). Because this is an operation issue and is not specific to equipment design and

climate location, the standby loss cannot be accurately captured in a simplified analysis. For this analysis,

the boiler FLEOHs are adjusted by calculating a standby loss factor to account for the standby losses (as

described in Appendix A).

The analysis of SWH equipment was similar to the boiler analysis. The total standby loss of energy

for SWH equipment is a function of the standby loss rating for the equipment being examined, as well as

the number of hours the system is on standby (generally 8760 hours minus actual firing hours). Unlike

the boiler analysis, where the FLEOHs were adjusted to reflect standby losses, the standby losses for

water heaters were explicitly specified.

2.2

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2.2 Annual Building and Equipment Space -Heating and -Cooling Loads

The first step in the process to create the building-level weighted FLEOH was to use a generic threestory, 15-zone prototype building, with characteristics that represent a particular building type to estimate

the coil loads. The generic building coil loads are estimated for each building type and at each climate

location. In addition to the variation in building characteristics, the use of airside economizers and

setback (setup) schedules can significantly affect the space loads. To account for these variations, four

sets of the generic building coil loads were estimated: 1) with economizer and setbacks; 2) with

economizer and without setbacks; 3) without economizer with setbacks; and 4) without economizers and

setbacks. The generic coil loads for each simulation (308 total runs, corresponding to 7 building types, 11

climate locations, and 4 combinations) were scaled to represent an average building (see Appendix A for

details of the building size and shape selections). The four sets of FLEOH for the cooling products and

two sets of FLEOH for the heating products (economizer runs do not apply to heating products) are

tabulated in Appendix A, as well as the weights associated with the fraction of the buildings having

economizers and setbacks/setups. These weights were derived from the CBECS (EIA 1995a).

From the scaled results, FLEOH were generated for heating and cooling equipment for each

representative building. Because multiple building zones exist in the scaled building, the FLEOHs from

each zone are weighted by the design loads in the zone to determine an average weighted FLEOH for that

building. The weights account for higher influence by zones having larger peak loads and a

corresponding larger number of units serving the zone. This aggregation results in a single FLEOH for a

particular building type and climate location. FLEOH are calculated for each class of equipment (heating

and cooling) and for each representative building type and climate location simulated. The process for

estimating the weighted FLEOH by building type and climate location is illustrated in Figure 2.1.

The annual load on HVAC or SWH equipment can be estimated by multiplying the FLEOH for that

representative building type, equipment use (heating, cooling or water heating), and climate, by the output

capacity (i.e., kBtu/h) of the equipment. For this analysis, the assumption was that the equipment is sized

to meet the design-day peak load, consistent with the chosen sizing algorithm.

2.3 Translation of Annual Loads to Annual Energy Use

Equipment efficiency is used to translate annual equipment loads to energy use as shown in

Equation (2.4). For simplicity, the equipment efficiency rating was used in the analysis seasonal energy

efficiency ratio (SEER)/EER for cooling equipment, thermal efficiency for heating and water-heating

equipment) because it is readily available for comparison across equipment categories; hence, for

commercial cooling equipment:

Annual Energy Use = FLEOH x Equipment Capacity

Efficiency

2.3

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Climate Locations

Denver

Detroit

Fresno

• Knoxville

• Los Angel es

• Minneapolis

Phoenix

• Providence

Seattle

• Shreveport

Tampa

Zone Results

Zone FLEOH

Building FLEOH

Building FLEOH =

F• Wt. Zone FLEOH

Climat

lim to

Climate 2

Location 1

Climate

Location 11

sop

3 J Food Services - 3 11 Warehouse -7

Education - Retai l -

Assembly -1 Office - 5

schedules Schedules

Occupancy Occupancy

ventgati.n nantiiatmn

WWR WWR

Lighting Power Lighting Power

Density Density

Equipment Equipment

Power Density Power Density

BLAST Simulation

Office -1

Education -4

Generic 3-Story

Building

• Generic square

building

• 15-Zone, three-story

• 5 independent zones

per floor (core + four

perimeter zones

FLEOH for Each Building Type by Climate Location

Figure 2.1 . Proposed Process for Estimating the Weighted FLEOH

by Building Type and Climate Location

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For packaged boilers and water-heating equipment, the FLEOH were adjusted to account for jacket

losses and standby losses, respectively. Therefore, the calculated annual energy use is the gross

consumption, including any losses associated with the products.

2.4 Representative Building Types

Because the scope of the analysis was to screen the products showing significant additional energy

savings over the Standard 90.1-1999 efficiency levels, the building types to be used in the analysis were

selected to account for at least 75% of the total commercial building energy consumption.

Based on the annual energy use of principal building types from the CBECS (EIA 1995), a ranking of

the building types was developed as shown in Table 2.1. Seven of the top eight building types (in terms

of the magnitude of annual energy use) were used in a previous analysis of efficiency levels for selected

commercial equipment (Barwig et al. 1996). The 7 building types also represent 78.4% of the cumulative

total energy consumption of all commercial buildings. Because they account for more than three-quarters

of the total commercial building energy consumption, the 7 building types were selected as the

representative building types that were simulated using the BLAST software for the present analysis

(BLAST 1991).

Although the health care building type accounts for a significant fraction (10%) of the total

commercial building energy use, it was not chosen for this analysis because comprehensive and accurate

building characteristics were not available. However, the outpatient care/doctor's office segment of the

health care building type was accounted for by using the office building model to represent space-cooling,

space-heating, and water-heating loads. This addition brought the percentage of the energy consumption

captured in the screening analysis up to over 80%.

Table 2.1 . Energy Consumption by Principal Building Activity

Principal Building Activity

Annual Energy Use

(trillion Btu) Percent of Total

Cumulative

Percent

Office 1 ,019 19.1 19.1

Mercantile and Service 973 18.3 37.4

Education 614 11.5 49.0

Health Care 561 10.5 59.5

Lodging 461 8.7 68.2

Public Assembly 449 8.4 76.6

Food Service 332 6.2 82.8

Warehouse and Stora ge 325 6.1 88.9

Other 173 3.3 92.2

Food Sales 137 2.6 94.8

Public Order and Safety 124 2.3 97.1

Religious Worship 104 2.0 99.0

Vacant 51 1.0 100.0

Total 5 323 100.0

Source: CBECS (EIA 1995).

The building activities in bold were used in the screening analysis.

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2.5 Climate Locations for the BLAST Simulation

The national climate variations for the BLAST simulation were represented by the same 11 climate

locations used in the Standard 90.1-1999 analysis , as well as the earlier equipment standards analysis

(Barwig et al. 1996). The 11 climate locations are Providence , Rhode Island; Detroit, Michigan;

Minneapolis, Minnesota; Knoxville, Tennessee ; Shreveport, Louisiana; Tampa, Florida;(a) Denver,

Colorado; Phoenix, Arizona; Seattle , Washington; Fresno, California; and Los Angeles, California.

Climate locations (see Figure 2.2) were selected to represent their influence on energy use in

commercial buildings. The selection process used climate-based criteria to determine the most representative climates. Work performed in developing Standard 90.1-1989 identified 11 climate-based criteria

that were determined to have significant influence on energy use in commercial buildings (ASHRAE

1989). Further details on the selection criteria can be found in Appendix D of Barwig et al. (1996).

2.6 Building Heating, Cooling, and Water-Heating Loads

For heating and cooling equipment, the annual energy use is a function of the heating or cooling loads

the equipment must meet. For a single equipment application, these loads can vary by hour of the day,

Figure 2.2 . U.S. Map Showing 11 Climate Locations (cities) and Corresponding Climate Regions

(dark boundaries), and 9 Census Divisions (shaded area)

(a) We replaced Orlando, Florida with Tampa, Florida because TMY2 weather data used for this analysis

were not available for Orlando.

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day of the week, and time of the year. The variations are driven by factors such as the type of building in

which the equipment is installed; the activities and internal loads (lighting, occupant, and receptacle

loads) in the building; and the buildings' internal and external environmental conditions, ventilation rates,

and HVAC control strategy. Building type is a convenient descriptor for categorizing the nature of loads

the HVAC equipment must meet. For water-heating equipment, annual energy consumption depends on

the demand for hot water. This demand can be also be linked to building type by the activities that create

the demand.

2.6.1 Building Space-Heating and Space-Cooling Loads

The BLAST detailed hourly simulation program was used to calculate the building (zone) loads

(BLAST 1991). Modeling the commercial buildings using the BLAST simulation tool required several

important input assumptions about the buildings' internal loads; key envelope characteristics;

occupancy/activity characteristics; ventilation rates and strategies; equipment control schedules; and

HVAC. Most of these inputs are based on the review of CBECS data (EIA 1992, 1995), and utility

metering studies of real buildings. Appendix A provides a detailed discussion of building load data that

were used in estimating the loads for the representative buildings types selected for the screening analysis.

This screening analysis used a generic three-story, 15-zone prototype building to estimate the coil

loads for all building types. Because of the extreme diversity in building size, shape, and other

characteristics, even within a particular building-type category, it is difficult to identify a single prototype

building that adequately represents the stock of buildings being analyzed. Any specific building plan

selected to represent an office building, for example, will have features that are not appropriate to apply to

all office buildings; e.g., the interdependence of a building's aspect ratio (length versus width) and

window orientation. Few buildings are exactly square or have the same amount of glass on each face. To

address this issue and others, including the economy of BLAST input file development and maintenance,

a single generic building prototype for all building types was used.

The generic prototype(a) was a square, 15-zone, three-story building with five independent controlled

zones on each floor-a single "core" zone and four "perimeter" zones facing each of the four cardinal

directions. For each building type actually modeled (e.g., office buildings), the internal loads, load and

operation schedules, and building envelope were modified to represent the particular characteristics of the

building type. The coil loads from BLAST are used as generic estimates of loads in the zones (core

versus perimeter, ground versus roof) of the different building types.

The generic zone coil load estimates for various building types and climate locations were scaled to

represent the coil loads for an average building of that type. The details of the scaling process are

described in the Appendix B of Barwig et al. (1996). The representative building size and shape (or

average building) for each building type were developed based on CBECS data (EIA 1992, 1995). The

details are provided in Appendix A of this report.

(a) Justification for using a three-story, 15-zone building and scaling loads from the generic building to a

specific building type is described in Barwig et al. (1996); additional details on the 15-zone building

prototype are also described in Friedrich and Messinger (1995).

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2.6.2 SWH Loads and Equipment Sizing

2.6.2.1 Loads

Average and peak hourly loads are based on data provided in Chapter 45, Table 7, of the ASHRAE

Handbook of HVAC Applications (ASHRAE 1995). However, the loads are given in terms of service

units, which were converted to loads per sq ft for this analysis. These conversions were developed for

each building type (see Appendix A, Section A. 11).

2.6.2.2 Sizing

Knowing the peak hourly load is not sufficient to properly size water-heating equipment. The

volume-to-recovery ratio for most commercial storage water heaters is considerably less than one hour,

and commercial buildings with built-up systems often provide storage much greater than one hour.

Chapter 45 of ASHRAE (1995) provides curves that characterize the trade-off between water heater

recovery capacity and usable storage capacity for each building type. For this analysis, the ASHRAE

curves were normalized by expressing storage capacity in terms of storage time rather than storage

volume. With the normalized curves, presented in Appendix A, Section A. 11, the ratio of a given water

heater's peak-load capacity to steady-state capacity in a given application can be obtained from the water

heater's storage time:

Storage Volume

Storage time (hours) =

Recovery Capacity

where storage volume is the actual storage volume in gallons and recovery capacity is the rated recovery

capacity in gallons per hour.

The analysis was further simplified by finding the slope and intercept for each sizing curve in the

small region (Storage Time <1 hour) where all EPACT-covered equipment lies. The slopes and

intercepts, and service unit conversions from Appendix A; the average and peak hourly loads from

Chapter 45 of ASHRAE (1995), Table 7; and other essential parameters (sources noted) are summarized

by building type in Table 2.2.

2.7 Mapping EPCA Equipment Categories to ASHRAE/Industry

Equipment Categories

EPCA, Section 342, as modified by EPACT, includes minimum-efficiency standards for small and

large commercial packaged air-conditioning and heating equipment, packaged terminal air conditioners

and heat pumps, warm-air furnaces, packaged boilers, storage water heaters, instantaneous water heaters,

and unfired hot water storage tanks. Each of these general classes of equipment is broken down by size

and design into categories, for each of which a minimum efficiency standard is prescribed in EPCA.

Most of these original categories are from Standard 90.1-1989.

2.8

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Table 2.2 . Building Service Water Heater Load Parameters by Building Type

Assembly Education Restaurant Lodging Office Retail Warehouse Source

Average Loads

(gph/su) 0 .042 0.050 0.100 0.583 0.042 0.042 0.042 ASHRAE 1995

Peak Load

(gph/su) 0 .4 0.8 1.5 5 0.4 0.4 0.4 ASHRAE 1995

Service Unit Occupant Student Meal Room Occupant Occupant Occupant ASHRAE 1995

Occupancy

(people/1,000

ft2) 16 10.7 11 3.3 3.3 2.2 0.3 Barwig et al. 1996

Service Unit

(su/1,000 ft2) Appendix A,

Density 16 10 19 3.3 3.3 2.2 0.3 Section A.l 1

Average Load

a h/1,000 ft2 0.67 0.50 1.90 1.93 0.14 0.09 0.013 Calculated

Peak Load

x h/1,000ftZ 6.40 8.00 28.50 16.50 1.32 0.88 0.120 Calculated

Appendix A,

Slope -2 .5 -6.7 -3.3 -2.7 -2.5 -2.5 -2.5 Section A.11

Intercept Appendix A,

x h/a h 9.6 18.2 15.0 8.3 9.6 9.6 9.6 Section A.11

Set Point (°F) 120 120 160 140 120 120 140 Barwig et al. 1996

Set Point (°F) 120 120 140 120 120 120 120 ASHRAE 1995

Operation

da / r 365.25 205 365.25 365.25 365.25 365.25 365.25 ASHRAE 1995

su = service units; h = gal per hour; agph = average hourly load and peak hourly load in gal per hour; xgph = peak al er hour.

To update the EPCA 92 minimum-efficiency requirements to be based on those in Standard 90.1-

1999, and to obtain cost data for the appropriate equipment categories, the Standard 90.1-1999 equipment

categories were mapped to those in EPCA. Generally, a one-to-one correspondence existed between the

categories in Standard 90.1-1999 and EPCA. However, in the following instances, EPCA does not

delineate categories of equipment in the same manner as Standard 90.1-1999:

1. where Standard 90.1-1999 splits the EPCA size category into multiple-size categories such as the

EPCA category for water-source heat pumps <65 kBtu/h

2. where EPCA provides a single efficiency level for "water-cooled, evaporatively cooled, and watersource central air conditioners and central air-conditioning heat pumps;" in each of several size

categories identified. Standard 90.1-1999 provides a separate standard for three product categories:

water-cooled air conditioners, evaporatively cooled air conditioners, and water-source heat pumps.

3. where Standard 90.1-1999 has broken both the PTAC and PTHP categories into "new construction"

and replacement market categories

4. where EPCA has two boiler categories-one for natural gas and one for oil-Standard 90.1-1999 has

broken these two boiler categories into several separate categories based on size range (300 to

<2,500 kBtu/h and >2,500 kBtu/h), fuel type (gas-fired, oil-fired, oil-fired [residual]), and either hot

water or steam output.

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2.8 Lifetime, Shipment, Baseline Cost, and Relative Cost Data

This section presents the engineering data that were gathered and used for the screening analysis.

2.8.1 Distribution Chain and Pricing for HVAC/SWH Equipment

To understand cost information on HVAC and SWH equipment, we had to know the distribution

chain and the point in the chain from which a cost was collected. Original equipment manufacturers

(OEMs) have design, development, materials, labor, and overhead costs to produce mechanical

equipment. Based on these costs and other factors, they determine selling prices for various markets and

circumstances. As a product moves through distributors, agents, and dealers/contractors, expenses and

margins are added to the selling price. For any group of costs, we must know the source of each cost and

its level within the distribution chain (see Figure 2.3).

Original

Equipment

Manufacturer

r

National

Accounts

(Distributor or End-User)

Mechanical

Contractor

End-User

End-User

OEM

End-User

OEM.

Distributorships

(Factory Branch or

Independent)

Dealer/

Contractor

Builder

End-User

Figure 2.3 . Equipment Distribution Chain

End-User

2.10

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
While the structure of the distribution chain may vary among manufacturers, several basic levels can

be identified. OEMs traditionally market their products in two ways-through national accounts and

distribution systems. National accounts may be end-users or function as secondary distribution systems.

Distribution systems may be multiple combinations of factory-owned distribution branches,

independently owned distributorships, and manufacturer's agents.

Factory-owned distribution branches and independently owned distributorships usually operate within

designated or franchised territories. Regardless of whether the distributorship is factory- or independently

owned, it represents the OEM in the area and is responsible for delivering the market share considered

appropriate by the OEM.

Manufacturer's agents function similar to independent distributorships. They are the OEM's

distribution representatives within a franchised sales territory responsible for delivering market share.

Agents do not customarily stock products but rather arrange product shipments from the OEM.

National accounts are usually high-volume purchasers developed and serviced by the OEM at the

national level. They tend to cut across sales territory lines and are usually excluded from franchised

distribution agreements. Products are shipped directly from factories to clients at either individual job

sites or warehousing facilities. Some national accounts are end-users while others resell the product for

installation. Manufactured and modular home producers are traditional national account markets because

the ultimate destination of the OEM's product may cross sales territory lines.

Distribution systems primarily serve two groups of contractors-heating and air-conditioning or

plumbing dealers/contractors and mechanical contractors. The heating and air-conditioning or plumbing

dealer/contractor traditionally purchases mechanical equipment from the distributorship and contracts

with end-users to provide and install the equipment. The dealer/contractor is usually a local company that

sells and services one or two equipment brands. In exchange for loyalty to a distributor's brand, the

company may be given a somewhat exclusive right to market that brand in a given area. When quoting

equipment and installation costs, the contract price is usually presented as one figure and does not

separate equipment from other costs. Issues such as system design, installation, start-up, and warranty

make the sale of "equipment only" impractical and unlikely.

Mechanical contractors generally bid to general contractors on construction projects designed by

architects and engineers. The bid must be based on specified or listed equipment approved as equivalent

for each job. The distributorship or manufacturer's agent furnishes quotes on the specified equipment (or

approved alternatives) for each construction project to all mechanical contractors planning to bid on the

project and for other equipment upon request. The mechanical contractor exhibits no brand loyalty and

has no protected sales territory. Equipment sales to mechanical contractors are from the distributorship or

manufacturer's agent and do not go through the dealer/contractor. The mechanical contractor's bid is

incorporated into the general contractor's bid and increased by some percentage as a part of the general

contractor's fee for managing the project. The cost of the equipment is not separated from other costs.

For design-build and other negotiated work, the mechanical contractor may contract directly with the enduser. Even in these situations, the contract price seldom separates equipment from other costs.

2.11

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2.8.2 Efficiency and Cost Data - Cooling Equipment

This section presents the lifetime, shipments, baseline cost, and relative cost for higher efficiency

levels for the cooling equipment.

2.8.2.1 Service Life

Estimates of service life for equipment are based on data in ASHRAE (1995). A 15-year service life

was used for all air-cooled products. A 19-year service life was used for all evaporatively cooled and

water-cooled products.

2.8.2.2 Shipment Data and Characteristic Equipment Size

In 1994, during the development of Standard 90.1-1999 , the Air-Conditioning and Refrigeration

Institute (ARI) provided annual shipment data(a) on most of the cooling equipment categories covered in

this analysis. In November 1999, ARI provided updated 1999 shipment estimates for most of the cooling

product categories in the screening analysis. (b )

In addition, ARI updated a list of characteristic equipment

sizes for each product category to best reflect current industry standards . Table 2.3 shows the 1999

shipment data provided by AR (b) and representative equipment sizes used in the screening analysis.

In the 1999 data, ARI recommended that the PTAC and PTHP equipment categories be broken into

four capacity ranges. It is necessary to examine multiple capacities for PTAC and PTHP equipment

because both the existing EPCA and Standard 90.1-1999 efficiency requirements are stated as a function

of cooling capacity.

Separate shipment estimates for evaporatively cooled air-conditioning equipment were not available

because ARI statistics combine the shipments of evaporatively cooled products with water-cooled air

conditioners. ARI believes that over 90% of these combined evaporative and water-cooled shipments are

water-cooled products.

Shipment estimates for the following five additional categories of equipment were not provided:

1. 3-phase, single-package air conditioners <65 kBtu/h

2. 3-phase, split-system air conditioners <65 kBtu/h

3. 3-phase, single-package heat pumps <65 kBtu/h

(a) ARI provided 1994 shipment data to the ASHRAE Mechanical Subcommittee during

Standard 90.1-1999 development.

(b) 1999 commercial cooling equipment shipment data and supporting letter provided by ARI to DOE,

December 1, 1999.

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4. 3-phase, split-system heat pumps <65 kBtu/h

5. water-source heat pumps >135 kBtu/h cooling capacity.

Table 2.3. Cooling Equipment Annual Shipment Data Used in the Screening Analysis

Category Description

Characteristic Capacity

(kBtu/h)

Estimated

Shipments Source

3-Phase, Single-Package, Air-Source AC, <65 kBtu/h 60 213,728 ADL, PNNL

3-Phase, Single-Package, Air-Source HP, <65 kBtu/h 60 27,773 ADL, PNNL

3-Phase, Split-system, Air-Source AC, <65 kBtu/h 60 91,598 ADL, PNNL

3-Phase, Split-system, Air-Source HP, <65 kBtu/h 60 11,903 ADL, PNNL

Central, Air-Source AC, >65 and <135 kBtu/h 90 165,000 ARI 1999

Central, Air-Source HP, >_65 and <135 kBtu/h 90 17,000 ARI 1999

Central, Water-Cooled AC, <65 kBtu/h 60 700 ARI 1999

Central, Evaporatively Cooled AC, <65 kBtu/h 36 N/A ARI 1999

Central, Water-Source HP, <17 kBtu/h 12 (or pick a reasonable size) 41,000 ARI 1999

Central, Water-Source HP, >17 and <65 kBtu/h 36 86,000 ARI 1999

Central, Water-Cooled AC, >65 and <135 kBtu/h 90 800 ARI 1999

Central, Evaporatively Cooled AC, >_65 and

<135 kBtu/h

90 Included with water-cooled for same

size category

Central, Water-Source HP, >65 and <135 kBtu/h 90 5,000 ARI 1999

Central, Air-Source AC, > 135 and <240 kBtu/h 180 65,000 ARI 1999

Central, Air-Source HP, > 135 and <240 kBtu/h 180 2,900 ARI 1999

Central, Water-Cooled AC, >_135 and <240 kBtu/h 180 600 ARI 1999

Central, Evaporatively Cooled AC, >_135 and

<240 kBtu/h

180 Included with water-cooled for same

size category

Central, Water-Source HP, > 135 and <240 kBtu/h 180 Not Available

Package Terminal AC, <7 kBtu/h 7 18,000 ARI 1999

Package Terminal AC, 7-10 kBtu/h 9 93,000 ARI 1999

Package Terminal AC, 10-13 kBtu/h 12 97,000 ARI 1999

Package Terminal AC, >13 kBtu/h 14 44,000 ARI 1999

Package Terminal HP, <7 kBtu/h 7 16,000 ARI 1999

Package Terminal HP, 7-10 kBtu/h 9 89,000 ARI 1999

Package Terminal HP, 10-13 kBtu/h 12 74,000 ARI 1999

Package Terminal HP, >13 kBtu/h 14 37,000 ARI 1999

2.8.2.3 3-Phase, <65 kBtu/h Unitary Cooling Equipment Shipment Estimates

According to the Copeland Corporation, unitary residential shipments (condensing units) were

roughly 5,639,000.(a) Shipments of commercial 3-phase equipment were 625,000 units, for a total of

6,264,000 units shipped (ARI 1998b). ARI reports shipments by equipment capacity so that out of the

total ARI shipment, 280,134 units were listed as >_65 kBtu/h in capacity. It is assumed that virtually all of

the units >65 kBtu/h use 3-phase motors. If we use the Copeland estimate of 625,000 3-phase condensing

units and subtract the 280,134 unitary equipment shipments >65 kBtu/h capacity, we arrive at 344,860

3-phase units <65 kBtu/h capacity.

(a) Data provided by Mark Kendal of Arthur D. Little (ADL) in e-mail communication in December

1999. Original data published in Air Conditioning, Heating and Refrigeration News, December 14,

1998.

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It was necessary to develop the shipments of single package versus split systems for both air

conditioner and heat pump units. ADL suggests that in 1994, single-package equipment made up

approximately 14% of all 3-phase and single-phase unitary shipments <65 kBtu/h. However, information

from commercial contractors suggests that a much larger fraction (probably the majority) of the

commercial systems in this size range is single-package rooftops as opposed to split systems. For this

analysis, it was assumed that 70% of the 3-phase systems in this size range are single-package equipment.

2.8.2.4 Baseline Cost Data

Baseline costs for cooling equipment were developed based on data collected through mechanical

contractors and equipment distributors in 1999.(') Collected cost data represented the minimum efficiency

products available from a given distributor. The number of data points collected varied from 1 to 7 for

each product analyzed. When more than three data points were collected, the high- and low-cost data

points were removed and the remaining cost data were averaged to reduce the effects of high- and lowcost outliers. In addition, the rated efficiency (EER or SEER) data were collected for as many of the

equipment categories as available.

In all cases, the average EER was higher than the minimum specified by EPCA 92. Thus, the average

of the cost and efficiency data are referred to as the market baseline cost and efficiency. When possible,

the available relative cost versus efficiency data for each product were used to back out the cost for an

EPCA 92 baseline product from the market baseline cost and efficiency data. This was done using

relative cost versus efficiency curves discussed in the following section.

Table 2.4 shows the number of data points collected; the high, low, and average cost without highand low-cost outliers; and the corresponding average efficiency figure for each product. The relative cost

for the higher efficiency level (EER), as compared with the EPCA 92 baseline, is also shown, as well as

the final estimate for the baseline EPCA 92 contractor cost.

2.8.2.5 Relative Cost for Higher Efficiency Levels

In 1994, ARI provided the ASHRAE Standing Standards Project Committee 90.1 (SSPC 90.1) with

relative cost versus efficiency curves for product efficiencies above the EPCA 92 baseline. These curves

were based on data collected by member industries and represented costs for which 90% of the industries

surveyed believed they could manufacture the equipment (relative to EPCA 92 baseline efficiency level).

The data were collected in this manner to preserve sensitive cost information among manufacturers.

Updated relative cost curves based on the average relative cost figures provided by manufacturers,

were unavailable for the present analysis. Thus, the 1994 relative cost curves, in conjunction with the

baseline costs discussed previously, were used as the basis for developing costs for higher efficiency

equipment, except for the 3-phase, <65 kBtu/h single-package and split-unitary systems.

(a) Baseline commercial equipment cost data collected by a) DuPont Dobbs Engineers, LLC, in 1999

under contract to DOE and b) Pacific Northwest National Laboratory staff.

2.14

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Table 2 .4. Cooling Equipment Baseline Cost Data

1994 1999 Cost Data

Estimated EPCA

Cost for No. of Baseline

ASHRAE Data High Low Average Average Relative Relative Cost Contractor

Product Analysis ($) Points Cost ($) Cost ($) Cost ($)^a' EERt't Cosh', Curve Cost ($)

3-Phase, Single-Package, Air- ARI Data for

Source AC, <65 kBtu/hW`< N/A 7 3,760 1,770 2,234 10.04 1.05 CAC Rule 2,128

3-Phase, Single-Package, Air- ARI Data for

Source HP, <65 kBtu/h"< N/A 6 4,640 2,100 2,613 10.07 1.04 CAC Rule 2,513

3-Phase, Split-system, Air- ARI Data for

Source AC, <65 kBtu/h(`) N/A 4 2,800 1,750 2,200 10.15 1.015 CAC Rule 2,167

3-Phase, Split-system, Air- ARI Data for

Source HP, <65 kBtu/h(`) N/A 5 3,280 2,080 2,395 11.20 1.128 CAC Rule 2,123

Central, Air-Source AC, 265

and <135 kBtu/h 3,452 7 7,196 2,587 3,613 9.70 1.131 UACI 3,194

Central, Air-Source HP, >_65

and <135 kBtu/h 3,636 6 8,560 3,200 4,115 8.93 1.006 UHPI 4,090

Central, Water-Cooled AC,

<65 kBtu/h 2,550 4 4,000 2,650 3,536 12.00 1.305 UAC5 2,709

Central, Water-Source HP,

<17 kBtu/h N/A 5 835 632 700 11.03 1.141 UHP3 613

Central, Water-Source HP,

>_17 and <65 kBtu/h 1,655 5 1,200 960 1,127 12.20 1.31 UHP3 860

Central, Water-Cooled AC,

265 and <135 kBtu/h 5,468 5 6,800 3,0 0 4,141 13.07 1.424 UAC6 2,908

Central, Evaporatively(`)

Cooled AC, >_65 and

<135 kBtu/h N/A 1 3,475 3,475 3,475 13.70 1.558 2,230

Central, Water-Source HP,

265 and <135 kBtu/h N/A 6 4,490 3,200 3,557 12.07 1.285 UHP3 2,768

Central, Air-Source AC, 2135

and <240 kBtu/h 5,967 6 9,560 5 163 7 273 9.20 1.07 UHPI 6,797

Central, Air-Source HP, 135

and <240 kBtu/h 7,911 5 1 11,520 6,644 9,526 9.48 1.14 UHP2I 8,356

Central, Water-Cooled AC,

>_I35 and <240 kBtu/h 11,079 5 9,600 5,800 7,830 12.33 L15 UAC4 6,808

Central, Evaporatively(d)

Cooled AC, >_ 135 and

<240 kBtu/h 11,079 2 6,400 5,800 NA NA NA UAC4 NA

Central, Water-Source(` HP,

>_135 and <240 kBtu/h N/A 7 9,078 5 800 7 372 NA NA NA NA

Package Terminal AC,

<7 kBtu/h N/A 5 748 640 710 11.45 1.214 NA 585

Package Terminal AC,

7-10 kBtu/h 808 6 774 660 726 10.62 1.134 pt l 640

Package Terminal AC,

10-13 kBtu/h 834 6 800 680 753 10.62 1.334 pt2 564

Package Terminal AC,

>13 kBtu/h 891 6 840 720 802 9.36 1.119 pt3 716

Package Terminal HP,

<7 kBtu/h N/A 5 832 710 781 11.53 1.204 NA 649

Package Terminal HP,

7-10kBtu/h 905 6 1,054 730 817 10.84 1.157 pt4 706

Package Terminal HP,

10-13 kBtu/h 936 6 1,076 760 842 10.36 1.344 t5 626

Package Terminal HP,

>I3kBtu/h 1,009 6 1,160 780 886 9.20 1.159 pt6 764

(a) After removing high- and low-cost outliers.

(b) Relative cost estimate of market baseline above EPCA baseline.

(c) SEER Rating

(d) Evaporatively cooled products were not analyzed independently from water-cooled products.

(e) Water-source HP >135 kBtu/h were not analyzed.

2.15

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For this equipment, relative cost curves were based on ARI data for single-phase, single-package, and

split-system air conditioners and heat pumps.

For PTHP and PTAC products, the 1994 ARI relative cost versus efficiency curves were for three

equipment capacities-9, 12, and 14 kBtu/h. Relative costs for efficiency levels for the <7 kBtu/h

categories were determined from an average relative-cost increase for the other three size categories for

the same relative increase in efficiency.

2.8.2.6 For central water-source heat pumps >_65 kBtu/h and <135 kBtu/h, the relative cost versus

efficiency data for the <65 kBtu/h water-source heat pump was used.

2.8.2.7 Product Efficiencies Analyzed

The range of efficiencies available on the market were determined by reviewing several data sources,

including the California Energy Commission Cooling Equipment Database (CEC 1999) and the ARI

unitary and applied equipment databases (ARI 1998a). From this list of available products, a highest

efficiency level was chosen to represent the highest efficiency products available on the market. The

highest efficiency level was not always the highest single point available on the market because, in some

cases, efficiency level may be available only for a single capacity in an otherwise wide-capacity range.

More often, the high-efficiency product analyzed represented the upper 5% of efficiencies available for

that product category and size range.

The analysis also required several intermediate efficiency levels between the EPCA 92 baseline and

the highest efficiency level analyzed level. No single method was used to choose these data points for all

cooling products. However, intermediate efficiency levels were based on several sources, including

• Standard 90.1-1999 Tier 2 efficiency levels

• recommended 2005 efficiency levels provided as comment to Standard 90.1-1999 by the ASHRAE

90.1-1999 upgrade committee

• the end points of the ARI relative cost curves, which should represent high-efficiency levels that

could be met by 90% of equipment manufacturers.

In other instances, points were chosen only to provide a range of possible efficiency levels for the

analysis based on the available data (e.g., single package and split systems <65 kBtu/h capacity). For

some products, the endpoints of the ARI relative cost curves or the recommended Tier 2 efficiency levels

exceeded the efficiencies available on the market, and these points became new highest-efficiency levels

for the screening analysis. For the PTHP and PTAC categories, Standard 90.1-1999 provides a required

efficiency for new construction and a lower required efficiency requirement for replacement market. A

maximum of six efficiency levels were analyzed for any given product.

2.16

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Costs for each of the chosen efficiency levels were generated using the EPCA baseline cost estimates

and the relative cost versus efficiency curves. Table 2.5 shows the estimated contractor cost for each

efficiency level used in the cooling equipment analysis.

Table 2.5. 1999 Contractor Cost Data for Cooling Products by Efficiency Level

Level 1

EPCA 92 Level2 Level 3 Level 4 Level 5 Level 6

Capacity

J

Analyzed Cost Cost Cost Cost Cost Cost

Product Description (kBtu/h) EER ($) EER ($) EER ($) EER ($) EER ($) EER ($)

3-Phase, Single-Package, Air- 60 9.7 2,128 9.7 2,128 11.0 2,532 12.0 2,766 13.0 3,468 15.0 4,745

Source AC, <65 kBtu/h(')

3-Phase, Single-Package, Air- 60 9.7 2,513 9.7 2,513 11.0 2,865 12.0 3,216 13.0 4,021 15.0 5,353

Source HP, <65 kBtu/h(a)

3-Phase, Split-system, Air- 60 10.0 2,167 10.0 2,167 11.0 2,514 12.0 2,947 13.0 3,533 15.0 5,201

Source AC, <65 kBtu/ht°,

3-Phase, Split-system, Air- 60 10.0 2,123 10.0 2,123 11.0 2,335 12.0 2,632 13.0 3,057 15.0 4,437

Source HP, <65 kBtu/h(°

Central, Air-Source AC, 90 8.9 3,194 10.3 3,932 10.5 4,101 10.8 4,392 11.0 4,648 12.5 8,823

>65 and <135 kBtu/h

Central, Air-Source HP, 90 8.9 4,090 10.1 4,957 10.5 5,485 10.6 5,636 11.0 6,524 11.7 9,219

>65 and <135 kBtu/h

Central, Water-Cooled AC, 60 9.3 2,709 12.1 3,573 12.5 3,752 13.1 4,080 14.0 4,798 12.5 3,752

<65 kBtu/h

Central, Water-Source HP, 12 9.3 614 11.2 711 12.5 843 13.1 946 14.0 1,165 15.8 NA

<l7 kBtu/h

Central, Water-Source HP, 36 9.3 861 12.0 1,094 12.5 1,182 13.1 1,327 14.0 1,634 15.2 NA

?17 and <65 kBtu/h

Central, Water-Cooled AC, 90 10.5 2,908 11.5 3,347 12.0 3,562 12.4 3,760 14.0 4,714 NA NA

>_65 and <135 kBtu/h

Central, Water-Source HP, 90 10.5 2,768 12.0 3,239 12.5 3,502 13.0 3,848 14.0 4,839 NA NA

>65 and <135 kBtu/h

Central, Air-Source AC, 180 8.5 6,797 9.7 7,613 10.2 7,885 10.4 8,089 10.8 NA 11.5 NA

>_l35 and <240 kBtu/h

Central, Air-Source HP, 180 8.5 8,356 9.3 9,259 9.8 9,919 10.4 10,713 10.8 NA 10.5 NA

>_135 and <240 kBtu/h

Central, Water-Cooled AC, 180 9.6 6,808 1 LO 7,830 11.1 7,830 11.2 7,945 11.3 7,993 11.5 8,081

>_l35 and <240 kBtu/h

Package Terminal AC, 6 8.88 585 9.41 597 11.01 686 11.24 713 0.00 776 11.60 NA

<7 kBtu/h

Package Terminal AC, 8.5 8.56 640 8.98 656 10.58 725 10.83 741 NA NA 11.50 831

7-10 kBtu/h

Package Terminal AC, 11.5 8.08 564 8.34 582 9.94 703 10.20 725 10.50 753 10.70 NA

10-13 kBtu/h

Package Terminal AC, 14 7.76 716. 7.92 721 9.52 819 9.79 871 10.00 967 10.00 967

>13 kBtu/h

Package Terminal HP, 6 8.88 649 9.31 658 10.81 745 11.04 776 0.00 865 11.60 NA

<7 kBtu/h

Package Terminal HP, 8.5 8.56 706 8.88 727 10.38 791 10.63 802 11.40 882 11.50 NA

7-10 kBtu/h

Package Terminal HP, 11.5 8.08 626 8.24 631 9.74 719 10.00 762 10.50 877 10.70 NA

10-13 kBtu/h

Package Terminal HP, 14 7.76 764 7.82 766 9.32 899 9.59 943 NA NA 10.00 1,032

> 13 kBtu/h

(a) SEER rating.

2.17

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
2.8.3 Efficiency and Cost Data - Packaged Boilers

This section presents the lifetime, shipments, baseline cost, and relative cost for higher efficiency data

for packaged boilers based on 1999 estimates.

2.8.3.1 Service Life

Estimates of service life for equipment are based on data in ASHRAE (1995). A 30-year service life

was used for all boilers.

2.8.3.2 Shipment Data and Characteristic Equipment Size

Boilers represent a large and diverse category of heating equipment, both in terms of the range of

sizes available, fuel types used, output (steam or hot water), or designs. During the development of

Standard 90.1-1999, steam and hot water boilers were analyzed separately (since the performance and

sometimes design varies with the type of output), using four different sizes of gas-fired packaged boilers.

Oil-fired boilers were not explicitly analyzed but were assumed to have thermal and combustion

efficiencies three percentage points higher than that finally established for gas-fired boilers. These same

four sizes were used for the screening analysis as well.

In November 1999, the Gas Appliance Manufacturers' Association (GAMA) provided historical

shipment estimates for gas-fired and oil-fired package boilers by fuel type. (a) The data provided was

insufficient to establish shipments for commercial boilers by size and fuel type as needed for the

screening analysis. Shipments by size and fuel type were were based on data provided by the Hydronics

Institute in 1996, which included shipments for 1994 and projected shipments to 2000.(b) The projected

shipments suggested a 45% growth in boiler shipments between 1994 and 2000. The historical data

provided by GAMA in 1999 did not suggest any growth trend in total boiler shipments over the period

from 1989 to 1998. Thus, the commercial shipments in 1994 were assumed to be an acceptable estimate

for future annual shipments.

The Hydronics Institute data were by size category and fuel, as well as by hot water and steam output

for cast iron construction. For steel boiler construction, steam, or hot water output were not indicated so

shipments of steel boilers were split between gas and oil categories.

The size categories in the Hydronics Institute data do not align with those specified for the screening

analysis. Shipments in several of the Hydronics Institute size categories were split according to the

fraction of the category range that belonged within the size ranges used in the screening analysis. The

resulting shipment estimates for gas-fired boilers are shown in Table 2.6.

(a) Gas-fired space-conditioning and service water-heating equipment shipment data and supporting

letter provided to Cyrus Nasseri of DOE, December 7, 1999.

(b) Detailed boiler shipment data provided in a fax from the Hydronics Institute to Pacific Northwest

National Laboratory, 1996.

2.18

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Table 2.6. Estimated Annual Shipments for Gas-Fired Boilers Used in the Analysis

Estimated Shipments

^1 Product Description Typical Capacity (kBtu/h) Gas-Fired Oil-Fired

Hot Water Boilers, 300-400 kBtu/h 400 2,821 2,389

Hot Water Boilers, 400-1,000 kBtu/h 800 3,077 2,641

Hot Water Boilers, 1,000-2,500 kBtu/h 1,500 540 1,337

Hot Water Boilers, 2,500+ kBtu/h 3,000 178 627

Steam Boilers, 300-400 kBtu/h 400 1,268 987

Steam Boilers, 400-1,000 kBtu/h 800 1,731 1,213

Steam Boilers, 1,000-2,500 kBtu/h 1,500 424 850

Steam Boilers, 2,500+ kBtu/h 3,000 135 374

2.8.3.3 Baseline Cost Data

Baseline costs for boilers were developed from data provided primarily by mechanical contractors or

equipment distributors. The data identified boiler costs by characteristic boiler size, hot water or steam

output, and gas or oil fuel input. The number of data points available varied from 3 to 7 for each product

analyzed. When more than three data points were available, the high- and low-cost data points were

removed from the set and the remaining cost data were averaged to reduce the effects of high- and lowcost outliers.

In all cases, the average combustion efficiency was higher than the minimum specified by EPCA.

Thus, the average of the cost and efficiency data are referred to as the market baseline cost and efficiency.

When possible, available relative cost versus efficiency data for each product were used to back out the

cost for an EPCA baseline product from the market baseline cost and efficiency data. The relative cost

versus efficiency data used was based on combustion efficiency relative cost curves supplied by GAMA

in 1994 to the SSPC. When the efficiency for a particular product was not provided, 80% combustion

efficiency was assumed. Note that the averaged market combustion efficiency was generally close to the

EPCA baseline (within two percentage points in all but one instance), and the impact on the final cost

estimate was a 5% to 13.5% reduction in cost from the market baseline to the EPCA baseline, depending

on product. Table 2.7 shows the baseline cost data for boilers.

2.8.3.4 Relative Cost for Higher Efficiency Levels

In 1994, GAMA provided tables to the ASHRAE Mechanical Subcommittee during Standard 90.1-

1999 development showing relative costs for specific combustion efficiency and thermal efficiency

improvements above the efficiency levels required by Standard 90.1-1989 (same as the EPCA levels).

These data were developed based on GAMA surveys of member industries and represented the average

manufacturer cost increases needed to reach specific efficiency levels. In some instances, the given

efficiency level represented a range of efficiencies that could be achieved at essentially the same relative

cost. The SSPC 90.1 performed its analysis using thermal efficiency as the metric of choice and thus

recommended thermal efficiency as the metric for the Standard 90.1-1999 requirements covering all

boiler sizes except for boiler capacities >2,500 kBtu/h. Because thermal efficiency can be directly

2.19

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 2.7. Boiler Baseline Cost Data

roduct

1994

Estimated

Cost for

ASHRAE

Analysis ($)

No. of

Data

Points

verage

Cost(a) ($)

Average

Comb

EFF

(%)

Relative

Cost fib)

(%)

EPCA

Baseline

Contractor

Cost ($)

Package Boilers, Gas-Fired, 400, HW 5,015 7 4,389 80.7 111 3,972

Package Boilers, Gas-Fired, 800, HW 6,621 7 6,220 80.7 111 5,629

Package Boilers, Gas-Fired, 1,500, HW 9,258 7 9,649 80.9 114 8,501

Package Boilers, Gas-Fired, 3,000, HW 14,969 7 15,161 81.4 110 13,733

Package Boilers, Gas-Fired, 400, Steam 5,015 4 5,460 80.0 100 5,460

Package Boilers, Gas-Fired, 800, Steam 6,621 4 7,248 80.0 100 7,248

Package Boilers, Gas-Fired, 1,500, Steam 9,258 5 13,813 81.0 110 12,580

Package Boilers, Gas-Fired, 3,000, Steam 14,969 5 18,746 82.0 104 18,025

(a) After removing high- and low-cost outliers.

(b) Based on 1995 ARI relative cost versus combustion efficiency data.

correlated with energy use, the screening analysis also uses thermal efficiency as the metric for efficiency

improvements. For boilers >2,500-kBtu/h input rating, the Standard 90.1-1999 efficiency level is a

combustion efficiency rating primarily because of difficulties in testing the thermal efficiency of larger

boilers.

In 1994, GAMA provided relative cost versus efficiency data to the SSPC 90.1. Applying these

relative cost data to the baseline costs results in costs that do not reflect current prices for high-efficiency

Equipment.(') Therefore, using boiler cost data from Freeman (1995), a functional relationship was

developed between the contractor cost data and boiler performance characteristics as shown below:

ContractorCost ($96) = 3.23 x input + 2.64 x (Ec) 2 + 1,009 x burner -15,755 (2.6)

where input = the gas fuel input in kBtu/h

E, = rated combustion efficiency as a two-digit integer (80 = 80% Ej

burner = a bimodal variable to represent the presence of a power burner (burner =1) or

atmospheric burner (burner = 0).

Equation (2.6) was used to generate the relative cost for targeted efficiency levels above the EPCA

minimum for hot water boilers with capacities up to 2 ,500 kBtu/h. Power burners were assumed for

boiler efficiencies greater than 82%, which was characteristic of the collected data. The data used to

generate Equation (2.6) incorporated few boilers above 2 ,500 kBtu/h. For boilers greater than 2,500

kBtu/h, estimates of cost for higher efficiency levels were based on data supplied by an industry

consultant. (b)

(a) Personal communications with Dirk Granberg, Chris Jostel of Mechanical Sales Inc., in 1999.

(b) Personal communications with Dirk Granberg in 1999.

2.20

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Equation (2.6) provides the relative cost as a function of input rating. However, a contractor

purchases a boiler based on output capacity to ensure it can meet the building load. Output capacity is a

function of the input rating as well as the thermal efficiency. Using a higher efficiency allows the input

rating to be reduced, reducing the boiler cost as calculated by the equation.

For low-pressure steam boilers, where the boiler design may be essentially the same as that for a hot

water boiler except for controls, the combustion efficiency is somewhat lower due to the change in

temperature of the working fluid from 180°F to 212°F (0 psig steam) as specified in the proposed test

procedure). The gap between the combustion and thermal efficiency is also larger for steam boilers due

to the higher operating temperature increasing the shell losses from a steam boiler. The effect or shell

losses depends on boiler volume, boiler input rating, and insulation level. Relative cost curves for steam

boilers were also developed assuming a typical 2% point difference between hot water and steam thermal

efficiencies for the two smaller size categories (400-800 kBtu/h boilers) analyzed, and a 1% point

difference for the next-larger (1,500 Btu/h) size category. For the largest size category, costs were based

directly on relative cost estimates supplied by consultants. (a)

Relative cost versus efficiency data for oil-fired boilers were not collected during the analysis, nor

were these data provided for the analysis of these products during the development of Standard

90.1-1999. Data provided by industry consultant(s) and other manufacturer's representatives indicate that

a combustion efficiency of 83% to 84% is typically the maximum for oil-fired designs due to difficulties

in designing for condensation in oil-fired equipment and associated flue systems.

2.8.3.5 Efficiency Levels Analyzed

An EPCA minimum, a Standard 90.1-1999 minimum, and the highest thermal efficiency bvel were

used for all gas-fired boilers. The combustion efficiency specified in EPCA was translated to thermal

efficiency based on the information provided by GAMA, which is 75 % thermal efficiency for hot water

boilers and 72% thermal efficiency for steam boilers. The highest thermal efficiencies analyzed were

88% for hot water boilers and between 81% and 82% for steam boilers , depending on size and available

data. Efficiency levels between the EPCA minimum and the highest efficiency levels were used based on

the availability of data points from the GAMA relative cost data. Table 2.8 shows the efficiency levels

analyzed and the corresponding relative costs above the EPCA minimum. Table 2.9 shows cost estimates

for boilers at each efficiency level that were obtained by applying the relative costs (from Table 2.8) to

the first-cost data.

2.8.4 Efficiency and Cost Data - Warm-Air Furnaces

This section presents the lifetime, shipments, baseline cost, and relative cost for higher efficiency

levels for warm-air furnaces.

(a) Provided by Dirk Granberg in December 1999.

2.21

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Table 2.8 . Gas-Fired Boiler Efficiencies Analyzed (with relative cost above baseline)

Level 1 (EPCA 92) Level 2 90. 1-1999 Level 3 Level 4 Level5 Level 6

Typical Thermal Thermal Thermal Relative Thermal Relative Thermal Relative Thermal Relative

Capacity Efficiency Relative Efficiency Relative Efficiency Cost Efficiency Cost Efficiency Cost Efficiency Cost

Product Description (kBtu/h) (%) Cost Cost (%) (%) (%) (%) (%) (%) (% (% (%)

Hot Water Boilers, 300-400 kBtu/h

output 400 75 100 75 100 78 115 79 132 81 209 88 318

Hot Water Boilers, 400-1,000kBtu/h

output 800 75 100 75 100 76 110 78 120 79 158 88 237

Hot Water Boilers, 1,000-

2500kBtu/houtput 1,500 75 100 75 100 77 105 78 111 79 134 88 180

Hot Water Boilers, 2,500+ kBtu/h

output 3,000 75 100 72 100 78 110 79 120 80 122 88 160

Steam Boilers, 300-400 kBtu/h

output 400 72 100 75 110 76 115 77 132 79 209 82 244

Steam Boilers, 400-1,000 kBtu/h

out put 800 72 100 75 115 76 120 78 158 79 163 82 225

Steam Boilers, 1,000-2,500 kBtu/h

out ut 1,500 72 100 75 105 77 123 78 134 79 141 81 152

Steam Boilers, 2,500+ kBtu/h output 3,000 72 100 72 100 78 130 79 135 80 138 82 156

Table 2.9. Cost Estimates for Gas-Fired Boilers

Level 6 (highest

Level 1 (EPCA 92) Level 2 (90.1-1999) Level 3 Level 4 Level 5 efficient" level)

Typical Thermal Thermal Thermal Thermal Thermal Thermal

Capacity Efficiency Efficiency Efficiency Efficiency Efficiency Efficiency

Product Description (kBtu/h) (%) Cost ($) (%) Cost ($) (%) Cost ($) (%) Cost ($) (%) Cost ($ (%) Cost ($)

Hot Water Boilers, 300-400kBtu/h

Output 400 75 3,972 75 3,972 78 4,585 79 5,262 81 8,291 88 12,636

Hot Water Boilers, 400-1,000 kBtu/h

output 800 75 5,629 75 5,629 76 6,220 78 6,772 79 8,908 88 13,360

Hot Water Boilers, 1,000-

2,500kBtu/houtput 1,500 75 8,502 75 8,502 77 8,927 78 9,452 79 11,420 88 15,293

Hot Water Boilers, 2,500+ kBtu/h

output 3,000 75 13,733 75 13,733 78 15,107 79 16,480 80 16,755 88 21,973

Steam Boilers, 300-400 kBtu/h

output 400 72 5,460 75 6,006 76 6,279 77 7,207 79 11,411 82 13,322

Steam Boilers, 400-1,000 kBtu/h

output 800 72 7,248 75 8,335 76 8,698 78 11,452 79 11,814 82 16,308

Steam Boilers, 1,000-2,500 kBtu/h

output 1,500 72 12,580 75 13,209 77 15,443 78 16,899 79 17,704 81 19,136

Steam Boilers, 2,500+ kBtu/h output 3,000 72 18,026 72 18,026 78 23,433 79 24,335 80 24,875 82 28 120

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
2.8.4.1 Service Life

Most commercial furnaces covered under EPCA are installed as an integral part of a combined

packaged cooling and heating unit, typically rooftop mounted. A 15-year service life was used for all

furnaces based on equipment life data published in the ASHRAE (1995) for packaged cooling equipment.

Life expectancies for stand-alone furnaces are expected to be slightly longer based on the same data

source.

2.8.4.2 Shipment Data and Characteristic Equipment Size

Total annual shipments of commercial furnaces are estimated to be 181 ,384, based on 1994 GAMA

data showing shipments of 164,300 commercial furnaces adjusted for a 15% increase in total furnace

shipments (residential and commercial) between 1994 and 1998.(a)

Two furnace sizes were analyzed in the screening analysis-250 and 400 kBtu/h. These two sizes

were chosen based on the availability of relative cost versus efficiency data supplied by GAMA during

the development of Standard 90.1-1999. In addition, the relative cost versus efficiency data supplied by

GAMA suggested strong differences between the 250 and 400-kBtu/h furnace costs relative to baseline

efficiency models.

Shipment weights for furnaces were estimated based on the fraction of total unitary equipment

shipments having furnaces corresponding to the 250-kBtu/h category or to the larger 400-kBtu/h furnace

design. It was assumed that larger furnaces would have relative costs versus efficiency profiles similar to

those for the 400-kBtu/h category. The 1998 ARI statistical releases (ARI 1998b) provide the following

equipment shipment data as shown in Table 2.10.

All of the 135 through 184.9-kBtu/h cooling equipment and 50% of the 185 through 249.9-kBtu/h

cooling equipment were assumed to use furnaces around the 250-kBtu/h size. The remainder of the

cooling equipment was assumed to use furnaces at or around the 400-1cBtu/h sizes. Thus, the relative

weights applied to these two furnace categories are 61% for 250-kBtu/h and 39% for 400-kBtu/h and

above furnaces. The estimated annual shipment was 110,644 small furnaces (represented by the 250-

kBtu/h size) and 70,740 large furnaces (represented by the 400-kBtu/h size).

2.8.4.3 Baseline Cost Data

The Standard 90.1-1999 furnace analysis was based on cost data provided by GAMA in 1994 to the

SSPC 90.1. The data were provided as a multiplier on the entire cost of a package heating and cooling

system. An assumption was made that the 250-kBtu/h capacity furnace was appropriately sized to a 10-

ton system and a 400-kBtu/h furnace was appropriately sized to a 15-ton cooling system. The screening

analysis used the relative cost information for higher efficiency furnaces that was tied to the total package

system price.

(a) Gas-fired space-conditioning and service water-heating equipment shipment data and supporting

letter provided to Cyrus Nasseri of DOE, December 7, 1999.

2.23

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 2.10. ARI 1998 Statistical Profile for Year Round Units

Cooling Capacity

(kBtu/h) 1998 Shipments

135 - 184.9 46,030

185 - 249.9 22,224

250 - 319.9 10,788

320 - 379.9 4,207

380 - 539.9 4,013

540 - 639.9 2,292

640 & Over 4,377

In 1994, the ASHRAE 90.1 mechanical subcommittee assumed the 250-kBtu/h capacity furnaces

would be used on a 10-ton system, and a 400-kBtu/h furnace would be used on a 15-ton system. A

review of available products from Carrier, Trane, and Bryant suggested this match was uncommon

(Barwig et al. 1996). Furnaces are typically available in both low-heat and high-heat configurations for

most commercial packaged equipment. A more typical matching for the high-heat configuration would

be to use a 250-kBtu/h furnace on a 10 to 12.5-ton system, and a 400-kBtu/h furnace would be considered

the high-heat option for a 15 to 20-ton system and the low-heat option on a 25-ton air-conditioning

system. For any piece of equipment, the low-heat furnace options are typically about two-thirds the input

rate of the high-input furnaces, and may actually represent the more commonly purchased option. Using

the combination analyzed by the SSPC 90.1 minimized the cost increases for higher efficiency furnaces;

therefore, the same combination (250 kBtu/h to 10 ton and 400 kBtu/h to 15 ton) was also used for the

present analysis.

The base cost data for packaged systems with furnaces was based on 1994 data used by the Standard

90.1 Mechanical Subcommittee in the furnace analysis. These furnace costs provided to the

subcommittee included a 25% markup. For this analysis, these costs were brought forward to 1999 using

a 2% per year gross domestic product inflator. After removing the 25% markup, the first costs used in the

screening analysis were $4,602 for a 250-kBtu/h furnace combined with a 10-ton packaged cooling

system, and $6,349 for a 400-kBtu/h furnace on a 15-ton packaged cooling system.

2.8.4.4 Relative Cost for Higher Efficiency Levels

The relative cost versus design options data provided to the Standard 90.1-1999 committee included

costs for reducing casing losses, as well as adopting power burners and Intermittent Ignition Devices

(IIDs) in furnaces. Twelve separate design options were considered (as shown in Table 2.11). Because

the basic EPCA 92 specifies only a combustion efficiency (Ec) rating of 80%, Case 2 (as shown in Table

2.11) was used as the EPCA 92 baseline. This baseline furnace has a casing loss of 1.5% based on rated

test conditions. The test condition casing loss was then multiplied by a factor of 3.3 to represent losses in

outdoor conditions (10 CFR Part 430 Subpart B, Appendix N). Table 2.11 shows the relative cost and

thermal efficiency data for each design option.

2.24

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
The lowest-cost product suggested by GAMA was Case 1, which, at 78% efficiency, is not allowed

under EPCA. The next lowest-cost product was for Case 2, which is assumed to represent the EPCA

baseline rooftop furnace product (1.5% casing loss, atmospheric burner, IID, 80% combustion efficiency).

Table 2.11. Standard 90.1 Furnace Design Options

Costs Relative To EPCA Combustion Thermal

Baseline Efficiency Casing Loss Efficiency

Furnace Designs 250 kBtu/h 400 kBtu/h

Case 1, Atmospheric Burner, Ec = 78%,

600-Btu/h Pilot, 1.5% Casing Loss 1.000 1.000 78 1.50 73.05

Case 2, Atmospheric Burner, Ec = 80%, IID,

1.5% Casing Loss 1.015 1.015 80 1.50 75.05

Case 3, Atmospheric Burner, Vent Cap,

Ec = 80%, IID, 1.5% Casing Loss 1.035 1.035 80 1.50 75.05

Case 4, Power Burner, Ec = 80%, IID, 1.5%

Casing Loss 1.060 1.060 80 1.50 75.05

Case 5, Power Burner, Ec = 82%, IID, 1.5%

Casing Loss 1.070 1.060 82 1.50 77.05

Case 6, Power Burner, Ec = 88%, IID, 1.5%

Casing Loss 1.500 1.510 88 1.50 83.05

Case 7, Atmospheric Burner, Ec = 78%,

600-Btu/h Pilot, 0.75% Casing Loss 1.050 1.010 78 0.75 75.53

Case 8, Atmospheric Burner, Ec = 80%, IID,

0.75% Casing Loss 1.065 1.025 80 0.75 77.53

Case 9, Atmospheric Burner, Vent Cap,

Ec = 80%, IID, 0.75% Casing Loss 1.085 1.045 80 0.75 77.53

Case 10, Power Burner, Ec = 80%, IID,

0.75% Casing Loss 1.110 1.070 80 0.75 77.53

Case 11, Power Burner, Ec = 82%, IID,

0.75% Casing Loss 1.120 1.070 82 0.75 79.53

Case 12, Power Furnace, Ec = 88%, IID,

0.75% Casing Loss 1.550 1.520 88 0.75 85.53

In addition to the EPCA baseline product features, the Standard 90.1-1999 efficiency level has mandated

a 0.75% casing loss, represented by Case 8.

The next higher combustion efficiency level (82%) is met by applying a power burner to Case 8,

represented by Case 11.

The highest efficiency level analyzed corresponds to Case 12, a condensing furnace. However, no

condensing rooftop furnaces were found from available literature.

Because a large number of existing furnace products have combustion efficiency levels near 81%, an

81% efficiency level was added (for the analysis) at 50% of the cost to reach the 82% level. Table 2.12

shows costs normalized to the EPCA baseline (Case 2).

Incorporating the first-cost information and the relative costs for higher efficiency levels results in the

cost estimates for each efficiency level shown in Table 2.13.

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Table 2.12. Relative Cost and Efficiency Data for Furnace Screening Analysis

Costs Relative to EPCA Combustion Casing Thermal

Baseline Efficiency Loss Efficiency

Furnace Designs 250 kBtu/h 400 kBtu/h (%) (%) (%)

Case 2, Atmospheric Burner,

Ecomb = 80%, IID, 1.5% Casing Loss 1.000 1.000 80 1.50 75.05

Case 8, Atmospheric Burner, Ec =

80%, IID 0.75% Casing Loss 1.049 1.010 80 0.75 77.53

Case 11, Power Burner, Ec = 81%,

IID, 0.75% Casing Loss 1.044 1.020 81 0.75 78.53

Case 11, Power Burner, Ec = 82%,

IID, 0.75% Casing Loss 1.103 1.054 82 0.75 79.53

Case 12, Power Furnace, Ec = 88%,

IID, 0.75% Casing Loss 1.527 1.498 88 0.75 85.53

Table 2.13. Contractor Costs for Furnace Efficiency Levels Analyzed

Level Level2

(EPCA 92) 90 . 1-1999 Level 3 Level 4 Level 5 Level 6

Thermal Thermal Thermal Thermal Thermal Thermal

Gas-Furnace Efficiency Cost Efficiency Cost Efficiency Cost Efficiency Cost Efficiency Cost Efficiency

Product (%) ($) (%) ($) (%) ($) (%) ($) (%) ($) (%) Cost ($)

Warm-Air

Furnaces, GasFired, 250 kBtu/h 75.1 4,602 77.5 4,827 78.5 4,952 79.5 5,076 NA NA 85.5 7,027

Warm-Air

Furnaces, GasFired, 400 kBtu/h 75.1 6,349 77.5 6,412 78.5 6,552 79.5 6,692 NA NA 85.5 9,511

2.8.5 Efficiency and Cost Data - Service Water Heaters

This section presents the lifetime, shipments, baseline cost, and relative cost for higher efficiency

levels for service water heaters.

2.8.5.1 Service Life

Commercial storage water heaters covered under EPCA were analyzed assuming a 7-year service life

and a 15-year life for instantaneous water heaters, based on data developed in the SSPC 90.1 analysis.

2.8.5.2 Shipment Data and Characteristic Equipment Size

GAMA provided annual shipments of gas commercial water heaters and electric commercial water

heaters from 1989 to 1998.(x) GAMA data breaking down the shipments into product categories were not

(a) Gas-fired space-conditioning and service water-heating equipment shipment data and supporting

letter provided to Cyrus Nasseri of DOE, December 7, 1999.

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EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
available. In addition, the gas water heater shipments did not include copper tube or coil-type water

heaters. The GAMA data through 1996 separates residential from commercial (EPACT-covered) water

heaters. However, the data beginning in 1997 separates residential and commercial water heater

shipments, based on the manufacturer's marketing of the product, which modifies the shipment data for

both gas-fired and electric products.

For this analysis, the shipments over the 5-year period from 1992 to 1996 were averaged to provide

an estimate for total shipments of gas storage and electric commercial water heaters. The resulting

estimated shipments are 107,646 units per year for commercial gas water heaters and 23,387 for electric

water heaters (see Table 2.14). GAMA does not track shipments of oil water heaters at either the

residential or the commercial level.

Table 2.14. Total Gas and Electric Commercial Water Heater Shipments

Year 1989 1990 1991 1992 1993 1994 1995 1996 1997("''') 1998" 5-yr avg.^`^

Gas Water Heaters 106,401 98,872 91,143 103,386 118,923 91,027 96,913 127,978 96,501 94,577 107,646

Electric Water

Heaters 19,768 20,121 19,768 22,646 21,142 22,288 23,905 26,954 30,339 35,586 23,387

(a) Does not include coppertube or coil-type commercial water heaters.

(b) Definitions for residential and commercial water heaters modified (see text).

(c) Represents data from 1992 through 1996.

Estimates were made of the relative proportions of commercial water heater shipments in 10 product

categories. These estimates were primarily based on data from an industry consultant (

a) and are shown in

Table 2.15. These estimates, in conjunction with GAMA shipment data, were used to develop shipments

data for the current analysis . It was assumed that shipments of commercial electric water heaters are

correctly represented by the GAMA data. It was assumed that the GAMA data for gas water heaters

essentially represented all shipments of gas storage water heaters, as well as instantaneous water heaters

>_10-gal capacity. Hence, the total GAMA shipments were allocated to these four categories in the

proportions indicated in Table 2.15. Shipments for the remaining < 10-gal instantaneous gas water heaters

were assumed to be in the relative proportion to gas storage water heater shipments shown in Table 2.15.

Estimated annual shipments for all gas and electric water heater categories are shown in the rightmost

column of Table 2.15. ADL has estimated shipments of commercial oil-fired water heaters at less than

1,000 units annually. (b) Because of the low volume of shipments and uncertainty in the number of

shipments, no further analysis of oil-fired water heaters was done.

(a) Personal communication with Max Minnear on January 8, 2000, regarding annual water heater

shipments by model category.

(b) Personal communication with Ed Barbour from ADL in November 1999.

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2.8.5.3 Baseline Cost Data and Characteristic Sizes

Characteristic sizes for gas storage and instantaneous water heaters were based on sizes and input

ratings used in the Standard 90.1-1999 analysis for each category of commercial gas water heaters listed

under EPCA. Two sizes of tankless instantaneous water heaters (400 and 1,000 kBtu/h) and a single size

instantaneous, integral tank water heater design were analyzed (500 kBtu/h, 100 gal). A single size

commercial electric storage water heater with a 120-gal storage volume and 30-kW input rate was chosen

for the analysis.

Table 2.15. Commercial Water Heater Shipment Proportions and Estimated Shipments

Volume

Original Estimated

Proportion of Shipment

Final

Estimated

Type Fuel

Input Rating

(kBtu/h)

Rating

(gal)

Individual Elements

(%)

Total

(%)

Annual

Shipments

Storage Electric All None 100 20 15.00 23,387 a

Storage Gas >75,<_155 None 20 11.25 21,083

Storage Gas >155,<_250 None 40 22.50 42,166

Storage Gas >250 None 40 75 75 22.50 42,166

Instantaneous Gas >210 <10 95 22.56 42,279

Instantaneous Gas >210 >_10 5 95 25 1.19 2,230

(a) Reflects supplied GAMA data for electric water heaters and not the original shipment fraction

estimates.

(b) Totals appear to overestimate actual shipments.

Baseline cost data for storage water heaters were developed based on contractor cost data collected by

industry consultants in l999.(a) Cost data for instantaneous water heaters was based on data collected in

1995 (Freeman 1995), which was used to develop equations relating contractor cost to water heater input

capacity and combustion efficiency. For tankless water heaters, this equation simplifies to

COST = 2.35 x INPUT - 7,872 x Ec + 49.5 x Ec2 + 314,743 (2.7)

where COST = the contractor cost in 1996$

INPUT = the input rating in kBtu/h

Ec = the combustion efficiency.

For instantaneous water heaters with integral tank, the difference between a high-input storage water

heater and the instantaneous water heater with tank is somewhat irrelevant and immaterial in terms of

design, with units falling just above and just below the 4,000-Btu/h.gal threshold level. Equation (2.8)

gives the cost for a water heater with integral tank above 155 kBtu/h and between 10- and 140-gal

capacity, regardless of whether the water heater is classified as an instantaneous design or a storage water

heater under EPCA.

(a) Baseline commercial equipment cost data collected by DuPont Dobbs Engineers , LLC, in 1999.

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COST = 5.80 x INPUT + 129 x WARRANTY + 486 x TANK + 910 x BURNER + 468 (2.8)

where COST = the contractor cost in 1996$

INPUT = the input rating in kBtu/h

WARRANTY = the length of the warranty in years

TANK = an indicator of tank construction (ASME tank = 1, else 0)

BURNER = an indicator of type of burner (power burner = 1, atmospheric = 0).

For the screening analysis, a 3-year warranty was assumed. For these high-input instantaneous water

heater designs, a power burner and ASME-rated tank were assumed.

In all cases, costs for gas instantaneous water heaters calculated using Equations (2.7) and (2.8) were

adjusted to 1999 costs using a 2% GDP inflator. The 1999 cost estimates for the products analyzed are

shown in Table 2.16.

Table 2.16. Baseline Gas Storage Water Heater Costs

Equipment

Category

Input

Category

(kBtu/h)

Size

Category

(gal)

Typical

Volume

(gal)

Typical

Input

Rating

(kBtu/h)

ASHRAE

Cost

(1994$)

No. Data

Points

Collected

(1999)

Average

Cost w/o

Hi and Lo

(1999$)

Gas-Fired Storage

Water Heaters >75,<_155 Any 75 120 3,665 3 1,775

Gas-Fired Storage 100 199 4,291 4 2,213

Water Heaters >155 Any 100 360 5,720 4 3,784

V <140 gal 120 1,980 4 1,609

200 3,294 3 2,375

500 8,274 3 5,022

Storage Tanks N/A V >_140 al _1,000 N/A 13,550 3 8 900

Costs for the baseline electric storage water heater were estimated using data collected by Freeman

(1995). These data are very extensive for electric water heaters, representing approximately 1,000

records for electric storage water heaters from nine companies, with tank volumes from 50 to 1,000 gal

and input ratings from 13.5 to 480 kW. Three separate cost models were developed from the data,

representing costs for common tank volumes of 50, 80, and 120 gal. Each cost model was a function of

the type of thermostat used (surface or immersion), tank construction (ASME or standard), warranty, and

one of three input rating classes. The cost model for a 120-gal electric water heater is shown as:

COST = 877 + 485 x THERM + 371 x TANK + 162 x WARRANTY + 392 x C2 +1002 x C3 (2.9)

where COST = the contractor cost in 1996$

THERM = thermostat type (surface = 0, immersion = 1)

TANK = tank construction (Standard = 0, ASME =1)

WARRANTY = the warranty in years.

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C2 and C3 are variables representing input class (C2 = 1 if input between 20 and

40 kW, otherwise 0. C3 = 1 if input greater than 40 kW, otherwise 0)

For the design analyzed, a surface-mount thermostat with a standard-tank construction, a 3-year

warranty, and a 30-kW element was chosen to represent the baseline model.

Table 2.17 provides the costs used in the Standard 90.1-1999 analysis for instantaneous water heater

products, as well as the estimated cost based on the data collected in 1999 that were used in the screening

analysis.

Table 2.17. Baseline Gas Instantaneous and Electric Water Heater Costs

Equipment Categor

Input

Category

(kBtu/h)

Size

Category

(gal)

Typical

Volume

(gal)

Typical Input

Rating

ASHRAE

Cost

(1994$)

Estimated

Cost

(1999$)

Gas-Fired Instantaneous Water >200 V <10 N/A 400 kBtu/h 3,477 2,794

Heaters - Tankless N/A 1,000 kBtu/h 5,460 4,294

Gas-Fired Instantaneous Water

Heaters - Integral Tank >200 V >_10 100 500 kBtu/h 8,824 5,466

Electric Water Heaters N/A V >-100 120 30 kW NA 1862

2.8.5.4 Costs for Higher Efficiency Levels

Storage Water Heaters - Five combinations of thermal efficiency and standby loss levels were

analyzed for gas storage water heaters. These levels represented:

1. EPCA baseline

2. Standard 90.1-1999 requirements for thermal efficiency and standby loss

3. 82% thermal efficiency with Standard 90.1-1999 standby loss levels

4. 82% thermal efficiency with Standard 90.1-1999 standby loss levels reduced by an additional inch of

insulation on the tank

5. a high-efficiency (86% thermal) water heater with approximately two-thirds of the standby loss of the

EPCA baseline

6. 94% thermal efficiency, fully condensing commercial water heater with two-thirds of the standby loss

of the EPCA baseline.

Relative costs above the EPCA 92 baseline were established for levels 2 through 6 above as follows:

cost information for changes in efficiencies from 78% to 82% were based on regressions of product cost

2.30

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
and efficiency outlined in Freeman (1995) for the <155 kBtu/h gas storage water heater category and

brought up to present value using a 2% cost inflator. For storage water heaters >155 kBtu/h, cost

increases were scaled by input rate. Note that the resulting cost increase in all three cases was

consistently below the GAMA relative cost data provided for the Standard 90.1-1999 analysis.

Typical commercial gas water heaters use 2 in. of insulation.(') An estimate of standby loss reduction

by adding 1 in. of insulation (R-7.5) was made for a 100-gal tank. No corresponding improvement in

efficiency was assumed because the thermal efficiency standard is separately regulated in both ASHRAE

and EPCA requirements. Manufacturer costs were estimated to increase $20 for the 100-gal water heaters

examined based on data supplied by industry consultants.(') The manufacturing cost for adding I in. of

insulation to the 75-gal water heater design was $17.17, based on the relative area to be covered on the

top and sides of two typical water heater designs (each with tank height of 55 in., and either 20 or 23 in.

in diameter for 75 and 100-gal water heaters, respectively). A 60% markup from manufacturing to

contractor costs was assumed.

An 86% thermal efficiency rating (partial condensing) with approximately two-thirds of the EPCA 92

standby loss was also analyzed based on GAMA relative cost data provided for the Standard 90.1

analysis.

Finally, the fully condensing water heater (highest efficiency level) design was analyzed, assuming a

first-cost at 200% of the last noncondensing water heater design (82% efficiency, 3 in. of insulation).

2.8.5.5 Instantaneous Water Heaters

Five levels of thermal efficiency were examined for the gas-fired instantaneous water heaters with

<10-gal storage capacity. Estimates for the higher efficiency costs were obtained from Freeman (1995).

The costs estimated for a baseline in this report are similar to those used in the Standard 90.1 analysis.

The relative cost increases for higher efficiency levels are typically less than those supplied by GAMA to

ASHRAE for the 83% and 86% efficiency levels analyzed. A fully condensing thermal efficiency level

of 94% was assumed to cost 200% of the cost of the 83% (noncondensing) level.

Six combinations of thermal efficiency and standby loss requirements were examined for

instantaneous gas-fired water heaters with volume >10 gal. These cost estimates were based on the same

data as for the storage water heaters.

2.8.5.6 Electric Water Heaters

Only one size of an electric storage water heater was examined (18 kW, 120 gal). Information from

industry consultant(a), as well as a review of the products in the commercial equipment cost survey

(Freeman 1995), suggested that most electric water heaters have 3 in. of insulation and standby loss levels

below those required by EPCA 92. Some products may meet the EPCA requirements with 2 to 2.5 in. of

insulation. For this analysis, we have assumed that the baseline model would have 3 in. of insulation.

(a) Personal communication with Max Minnear in 1999.

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EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Standard 90.1-1999 allows an increase in standby loss, which occurs across all sizes of electric water

heaters. An analysis was done to estimate the impact of going from the EPCA levels to the requirements

in Standard 90.1-1999. No requirement exists under EPCA for a minimum thermal efficiency of electric

water heaters; however, to be consistent with the other water heater analysis, we estimated the thermal

efficiency as:

Thermal Efficiency = 1- Standby loss/input rating (2.10)

where standby loss is the allowed standby loss requirement in Standard 90.1-1999 and input is based on

the 30 kW assumed for this water heater design. Both variables were converted to consistent heat units

(Btu/h) for use in Equation (2.9), assuming a 100% conversion of electrical power input to heat.

For the screening analysis, 2 in. of foam insulation was assumed to meet the Standard 90.1-1999

standby loss level. The standby loss impact of an additional inch of insulation (R-7.5) on the tank walls

and roof (estimated at 35.6 ft2 for the 120-gal electric water heater design analyzed) was calculated. The

difference between hot water and ambient air temperature was assumed to be 70°F for the above

calculation.

The cost to add this third inch of insulation was estimated assuming a manufacturing cost increase of

approximately $23, based on a $20 manufacturer's cost increase for a 100-gal tank.(a) A further 60%

markup was used to go from manufacturer's cost increase to a contractor cost increase of $37. No further

reduction in standby loss requirement was analyzed for electric water heater designs.

No relative cost information was collected for commercial oil-fired water heaters in the screening

analysis. Because of the low volume of shipments and lack of cost data for higher efficiency levels, no

further analysis of oil-fired water heaters was attempted in the screening analysis.

Table 2.18 outlines the water heater thermal efficiency levels, standby loss requirements, and

associated product cost. Efficiency levels corresponding to Test Level 2 for instantaneous gas water

heaters (<10-gal capacity) and Test Levels 2, 3, and 4 for electric water heaters were not developed for

the screening analysis and hence are marked "NA" in Table 2.18.

(a) Personal communication with Max Minnear in 1999.

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Table 2.18 . Water Heater Efficiency Levels and Contractor Costs Used in Screening Analysis

EPCA 1992 Standard 90.1-1999 Test Level 1 Test Level 2 Test Level 3 Test Level 4

Eff. Standby First Eff. Standby First Eff. Standby Eff. Standby First Eff. Standby First Eff. Standby First

(lt) Loss Cost (E,) Loss Cost (F,) Loss First (E,) Loss Cost (l!,) Loss Cost (F,) Loss Cost

Product (%) (Btu/h) ($) (% ) (Btu/h) ($) (%) (Btu/h) Cost ($) (%) (Btu/h) ($) (%) (Btu/h) ($) (%) (Btu/h) ($)

Storage Water Heater, GasFired, 120 kBtu/h 78 1,193 1,775 80 1,103 1,822 82 1,103 1,869 82 1,053 1,897 86 804 2,787 94 804 3,739

Storage Water Heater, GasFired, 199 kBtu/h 78 1,262 12,213, 80 1,349 2,291 82 1,349 2,369 82 1,291 2,401 86 934 3,696 94 934 4,739

Storage Water Heater, GasFired, 360 kBtu/h 78 1,262 3,784 80 1,550 3,924 82 1,550 4,067 82 1,492 4,099 86 934 6,319 94 934 8,134

Instantaneous Water Heater,

as-Fired, 400 kBtu/h 80 NA 2,794 80 NA 2,794 83 NA 3,420 NA NA NA 86 NA 4,991 94 NA 6,839

Instantaneous Water Heater,

as-Fired, 1,000 kBtu/h 80 NA 4,294 80 NA 4,294 83 NA 4,920 NA NA NA 86 NA 6,491 94 NA 9,839

Instantaneous Water Heater,

as-Fired, with integral tank,

500 kBtu/h 77 1,649 5,466 80 1,725 5,747 82 1,725 6,027 82 1,667 6,059 86 1,110 9,730 94 1,110 12,055

Electric (120 gal) 99.4 343 1,862 99.3 403 1,862 99.4 348 1,900 NA NA NA NA NA NA NA NA NA

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
3.0 Energy Savings and Economic Impact Analysis

This section describes the methodology and key data inputs to estimate energy savings and economic

impacts of alternative efficiency levels for products addressed in the screening analysis. Section 3.1

provides an overview of the energy savings and economic analysis methodology. Section 3.2 discusses

the key data sources and assumptions used in the economic analysis-energy prices, the conversion of

delivered-to-primary energy, the discount rate, the shipment projections, and product cost markups. The

methodology and the resulting estimates of national energy savings and national net present value (NPV)

are included in Section 3.3. Section 3.4 presents the detailed methodology used to generate life-cycle cost

(LCC) estimates by building type and region and to aggregate them to national impacts. Section 3.5

discusses the expected reduction in carbon emissions associated with the national energy savings.

Finally, Section 3.6 presents the aggregated summary results for national energy savings, carbon emission

savings, and NPV for all products considered in the screening analysis. A one-page summary of the

energy and economic results for each product is provided. A more detailed discussion of the results for

selected products using this one-page summary is contained in Appendix C (Section C.4).

3.1 Overview of Methodology

Figure 3.1 presents an overview of the energy savings and economic impact analysis conducted as

part of the screening analysis. The figure is divided into three columns. The left column shows the inputs

from the engineering analysis. The center column shows the key inputs and outputs that are estimated for

each of the 77 market segments (product of 7 building types and 11 subcensus divisions) that were used

in the overall analysis. The right column shows the aggregation of both energy savings and economic

results to national values.

With respect to the engineering analysis, the top left box shows the estimated FLEOH (generated for

each of the market segments) that serve as the primary input to estimating unit energy consumption. Of

course, the unit consumption also depends upon the capacity of the equipment and the efficiency level.

To estimate national energy consumption, unit energy consumption was multiplied by an estimate of

product shipments to each market segment and then summed to a national total. Lacking direct

information on regional shipments of equipment, the approach in the screening analysis was to use

information on the distribution of commercial building floor space and the percentage of floor space

served by generic types of equipment to generate estimates of distributions of shipments by market

segment. These distributions were applied to projections of total national shipments to yield projections

of shipments by market segment. (The methodology and data sources to generate these distributions are

described in Appendix B.) National energy savings estimates were calculated as the difference in national

energy consumption between two assumed levels (a baseline standard and a potentially higher standard)

of energy efficiency for the product being analyzed.

3.1

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Engineering Energy and LCC National

Estimates By Analysis Market Segments Estimates

q FLEOH

q Capacity (output)

q Efficiency I

Unit Energy

Consumption by

Market Segment

National Energy

Consumption and

Savings

Estimated Shipments

of Products by

Market Segment

q Equipment Price

q Equipment Lifetimes

Unit LCC

(Unit LCC Savings)

by Market Segment

Discount

Rate

Energy

Prices for

11 Region

National NPV

Figure 3.1. Overview of the Energy Savings and Economic Analysis Methodology

The LCC analysis was also conducted at the market segment level. Among other inputs, for a single

unit of equipment, the LCC analysis requires estimates of the price (first cost) of the equipment as well as

annual energy consumption. The equipment price information and estimated lifetime of the equipment

are also inputs to the analysis. Unit energy consumption feeds directly into the LCC analysis as shown in

the middle column. The two boxes at the bottom of the middle column illustrate the two remaining inputs

to generate LCC-discount rate and energy prices. Energy prices were determined for the subcensus

divisions (modified census divisions) used in the market segment analysis, and were assumed constant for

all representative building types within a given division.

National NPV was based upon an aggregation of the LCC estimates for each market segment, again

using the estimated distribution of shipments by market segment.

3.2 Data and Key Assumptions

LCC measures are functions of the unit energy consumption, equipment prices, energy prices, and the

discount rate. The approach for determining the unit energy consumption and equipment prices is

3.2

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
discussed in Section 2.0. This section documents the approach used to generate energy prices for the

economic analysis, as well as the discount rate chosen. In addition , conversion factors are needed to

convert delivered energy to a primary basis.

3.2.1 Energy Prices

The Energy Information Administration (EIA) Annual Energy Outlook (AEO) provided the projected

energy prices used in the screening analysis (EIA 1999b). The AEO projects energy prices by census

division for all major fuels for each sector (residential, commercial, industrial, and transportation). The

AEO extends to only 2020, whereas the screening analysis used a time horizon extending to 2030. The

energy prices beyond 2020 were fixed at the AEO 2020 levels.

As described in Appendix B, the Mountain and Pacific census divisions were split into "north" and

"south" regions. The projected energy prices for these subcensus divisions were estimated using

adjustment factors applied to the AEO energy price projections . This process is explained in Appendix B.

We had to consider how to account for the (electricity) demand charges that may affect the economics

of higher-efficiency cooling equipment . A priori, the impact of demand charges is expected to result in a

marginal price of electricity that exceeds the average price because the contribution of lower cooling

energy consumption is expected to have a greater proportional effect on peak load than on the total energy

consumption. A rough analysis of the effect of demand charges on the marginal electricity price showed

that adding perhaps 1 to 1.5 cents per kWh to the average electricity price would adequately account for

this effect. (a)

For the screening analysis, a somewhat higher price for electricity (for cooling) was used to

adequately reflect the national benefits of reducing peak summer electricity demand. In part , to give

additional weight to the presence of buildings with relatively higher summer electric peak loads,

electricity prices in the screening analysis were uniformly adjusted upward by 5%. Table 3.1 shows the

final sets of regional energy prices for selected years, including the electricity price adjustment used in the

screening analysis.

Toward the end of the analysis, a quick assessment of the electricity price was done using Ernest

Orlando Lawrence Berkley National Laboratory 's (LBNL) existing database of utility rate structures. The

initial assessment was that, averaged across 30 utilities representing 26% of all commercial customers

nationwide , the effective marginal price that would be appropriate for reductions in cooling energy

consumption was higher (3% to 4%) than the average price, just slightly less than the 5 % adjustment

factor used in the screening analysis.

(a) Memorandum from Steven Nadel and Keith Emerson to the SSPC 90.1 HVAC panel dated March 7,

1994, regarding demand charges for cooling equipment.

3.3

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.1. Electricity and Gas Prices Used for Screening Analysis

Electricity

(cents per kWh)

Region 2000 2005 2010 2020 2030

Northeast 9.8 9.3 8.3 7.9 7.9

Mid-Atlantic 9.8 8.4 7.9 7.8 7.8

East North Central 7.4 6.6 6.2 6.0 6.0

West North Central 6.9 6.4 6.4 6.1 6.1

South Atlantic 6.7 6.2 6.2 6.0 6.0

East South Central 6.7 6.3 6.2 6.1 6.1

West South Central 6.9 6.5 6.4 6.3 6.3

Mountain North 6.2 6.1 6.1 5.8 5.8

Mountain South 7.8 7.6 7.6 7.3 7.3

Pacific North 5.0 4.5 4.4 4.3 4.3

Pacific South 9.5 8.5 8.3 8.2 8.2

U.S. Average 7.6 6.9 6.7 6.5 6.5

Natural Gas

(dollars per million Btu)

Region 2000 2005 2010 2020 2030

Northeast 7.08 7.02 6.93 6.71 6.71

Mid-Atlantic 5.30 5.34 5.39 5.39 5.39

East North Central 5.37 5.35 5.36 5.35 5.35

West North Central 4.96 5.04 5.03 5.03 5.03

South Atlantic 6.45 6.21 6.19 6.09 6.09

East South Central 5.81 5.68 5.76 5.82 5.82

West South Central 4.84 4.76 4.87 5.01 5.01

Mountain North 4.63 4.95 5.24 5.26 5.26

Mountain South 4.63 4.95 5.24 5.26 5.26

Pacific North 5.79 5.97 6.00 5.69 5.69

Pacific South 5.79 5.97 6.00 5.69 5.69

U.S. Average 5.47 5.48 5.53 5.50 5.50

3.2.2 Energy Conversion Factors

The final national estimates of energy savings for the screening analysis are defined on a primary

energy basis and, thus, include generation and transmission losses in addition to the energy delivered to

the building. For electricity, the conversion from delivered to primary energy is based on the

commercial-sector projections of delivered electricity and electricity losses from the AEO 2000. Table 2

from the AEO 2000 provides delivered electricity and associated losses for 1998, 2005, 2010, 2015, and

2020 (EIA 1999a, Reference Case, Table 2, p. 118). The ratios of [(delivered + losses)/(delivered)] were

calculated for these years and then interpolated for the intervening years. The resulting conversion factors

were then used to convert the annual electricity consumption estimates for the various efficiency levels to

primary energy (trillion Btu or TBtu) estimates.

3.4

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Some losses are also incurred in the transmission and distribution of natural gas (e.g., natural gas used

to power pumps along gas pipelines). The screening analysis used the estimate of 11% losses (as used in

the residential water heater analysis).

3.2.3 Discount Rate

For the calculations of LCC and NPV, the preliminary screening analysis used a constant 7% (real)

discount rate. This value has been used in prior DOE analyses of residential appliances to generate

estimates of national NPV from more stringent equipment efficiency standards. This particular value is

motivated by the recommendation of the Office of Management and Budget (OMB) in Circular A-94,

(OMB 1992). Circular A-94 indicates that this value corresponds to the approximate marginal pretax rate

of return on the average investment in the private sector in recent years.

3.2.4 Shipment Forecasts

Section 2.0 describes the data sources and assumptions to estimate total shipments of each product for

a recent year, nominally chosen as 1999. The estimates of national energy savings and carbon emissions

through 2030 depend upon the differences in unit energy savings from higher efficiency as well as the

projected total shipments over the time frame. A constant 1% growth rate was applied to the estimate of

1999 shipments to generate the projected levels of shipments over the analysis period. The 1% growth

rate was motivated by the AEO 2000 (EIA 1999a) projection of the growth rate in total commercial

building floor space between 1998 and 2020 of 0.9% per year. The use of a common growth rate for all

products results in comparisons of potential energy savings that reflect only the economics of higher

efficiency levels and the current shipments.

3.2.5 Equipment Price Markups

The development of contractor costs for all equipment analyzed in the screening analysis was

discussed in detail in Section 2.0. As discussed in Section 2.8.1, the equipment cost is generally marked

up as part of the contractor's final price to the builder owner. Following the assumptions in related work

(Barwig et al. 1996; data used during Standard 90.1-1999 development), a 25% markup factor was

applied to contractor costs for all equipment.

3.3 National Energy Consumption and Energy Savings

As stated above, the energy consumption and energy savings are based on the estimates of FLEOH

generated in the engineering analysis and on the aggregation procedures described in Section 2.0. The

economic analysis focuses on an LCC approach, which yields some insight into the distribution of cost

savings by market segment, as well as measures of aggregate economic benefit to the nation. This section

lays out the method to compute the energy savings and economic benefit measures.

3.5

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
3.3.1 Methodology

The engineering analysis yields an estimate of the FLEOH for each market segment. With the

estimate of FLEOH, annual energy consumption for a unit of equipment in each market segment can be

expressed by Equation (2.4). Total consumption in each market segment is based on unit annual energy

consumption multiplied by projected shipments to that segment. The estimates of shipments to the

market segments are based on a projected distribution by market segment applied to total national

shipments (a single value for each year).(') Using the letter (k) to designate the level of efficiency,

national energy consumption is calculated by summing the estimated consumption for all market

segments, as in

National Energy Consumptio n(k) =

7 11

I MS j j x Shipments x Rated Capacity x FLEOH;1

Rated Efficiency k

where MS;j = share of national shipments installed in market segment i,j

i = building type

j = subcensus division

Shipments = total units shipped, nationally.

Because of the linearity of the entire process, the value of national energy consumption from

Equation (3.1) is identical to the value calculated from a national average FLEOH (FLEOHus) and total

national shipments. (b) This alternative formulation is shown as:

National Energy Consumptio n(k) = (Shipments x Rated Capacity x FLEOH us)

Rated Efficiency k

(3.2)

For water heaters, the existence of standby losses complicates the expression in Equation (3.1) [or

(3.2)] to some degree. Standby losses are expressed in British thermal units per hour (Btulh) and thus the

annual consumption is expressed as the product of the number of hours the water heater is not firing

(8760 - FLEOH) times the standby loss per hour . Thus, national energy consumption for water heaters is

calculated as:

National Energy Consumptio n(k) =

(Rated Capacity x FLEOH us) Shipments x

Rated Efficiency k

+ (8760 - FLEOH) x Standby loss

(a) The definitions of the market segments and methodology to project shipments to each market

segment are discussed in Appendix B.

(b) The derivation of FLEOHUS is described at the end of Appendix B.

3.6

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
By convention, for the baseline efficiency, k is assigned a value of 0. With this notation, energy

savings for any selected efficiency level higher than the baseline is given by:

National Energy Savings (k) = (3.4)

National Energy Consumptio n(0) - National Energy Consumptio n(k)

While shipments in Equations (3.1) through (3.3) can be either annual or cumulative, to estimate

national energy savings in any future year, we must account for the influence of equipment turnover.

Assuming that all units are replaced at the end of their assumed lifetime, total national energy

consumption is the sum of the previous N years of shipments (yielding the currently installed stock) times

the unit energy consumption. The annual savings in any year is the difference in the energy consumption

of the stock evaluated at the two efficiency levels.

3.3.2 Energy Savings Results

The national energy savings estimates for all of the efficiency levels analyzed in the screening

analysis are presented in Tables 3.2 through 3.4. Table 3.2 shows the estimates for the 22 cooling

products analyzed. The first two columns show the baseline energy consumption and EER for each

cooling product, based upon the efficiency level specified in EPCA 92. Baseline energy consumption is

defined as the cumulative energy consumption of all products in that size category sold between 2004 and

2030. The top three products in terms of overall energy consumption are the 3-phase single-package air

conditioner (<65 kBtu/h), the central air source air conditioner (>_65 kBtu/h and <135 kBtu/h), and the

central air source air conditioner (>_135 kBtu/h and <240 kBtu/h).

The 3-phase unitary and HP equipment are available up to a SEER of 15. At these efficiency levels,

the potential savings through 2030 would exceed four quads of primary energy.

For the small central air source AC unit (>_65 kBtu and <_135 kBtu), the adoption of Standard 90.1-

1999 is expected to achieve about 0.9 quads (900 TBtu) of savings over the 2004 to 2030 time frame.

This level of energy savings results from an increase in EER from 8.5 to 9.7. For an efficiency of 11.5

EER, the additional energy savings potential is nearly one quad.

The energy savings potentials for heating products are shown in Table 3.3. In terms of total energy

consumption, the category is dominated by gas-fired furnaces (as part of packaged space-conditioning

equipment). Baseline energy consumption for the two size categories of furnaces over the 2004 to 2030

period is nearly 16 quads, while consumption for all of the boiler classes is less than 5 quads. All of the

efficiency metrics are in terms of thermal efficiency. Thermal efficiency generally ranges from 3-to-5

percentage points less than the combustion efficiency levels for these products.

Table 3.4 shows the national energy savings potential for the commercial water-heating equipment

considered in the analysis. To maintain simplicity in the table, only the thermal efficiency requirement of

the storage water heaters is shown in the table. In some cases, two levels of energy savings are shown for

the same thermal efficiency; this result arises from different standby loss requirements.

3.7

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3 .2. National Baseline Energy Consumption and Energy Savings - Space-Cooling Equipment

Standard 90.1-1999 Efficiency Level 1 Efficiency Level 2 Efficiency Level 3 Efficiency Level 4

EPCA 1992 Relative to EPCA 92 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999

2004-2030

Baseline Energy Energy Energy Energy Energy

Consumption Savings Savings Savings Savings Savings

Product (TBtu) EER EER (TBtu) EER (TBtu) EER (TBtu) EER (TBtu) EER (TBtu)

3-Phase, Single-Packaged, Air-Source AC, <65 kBtu/h('

7,371 9.7 9.7 0.0 11.0 871 12.0 1,413 13.0 1,871 15.0 2,604

3-Phase, Single-Packaged, Air-Source HP, <65 kBtu/h('

958 9.7 9.7 0.0 11.0 113 12.0 184 13.0 243 15.0 338

3-Phase, Split-system, Air-Source AC, <65 kBtu/hl'

3,064 10.0 10.0 0.0 11.0 279 12.0 511 13.0 707 15.0 1,021

3-Phase, Split-system, Air-Source HP, <65 kBtu/hl'l

398 10.0 10.0 0.0 11.0 36 12.0 66 13.0 92 15.0 133

Central, Air-Source AC, _65 and <135 kBtu/h 8,813 8.9 10.3 1,198 10.5 145 10.8 353 11.0 485 12.5 1,340

Central, Air-Source HP, >_65 and <135 kBtu/h

908 8.9 10.1 108 10.5 31 10.6 38 11.0 66 11.7 109

Central, Water-Cooled AC, <65 kBtu/h

28 9.3 12.1 7 12.5 1 13.1 2 14.0 3 12.5 1

Central, Water-Source HP, <17 kBtu/h

333 9.3 11.2 57 12.5 29 13.1 40 14.0 55 15.8 81

Central, Water-Source HP, >_ 17 and <65 kBtu/h

2,096 9.3 12.0 472 12.5 65 13.1 136 14.0 232 15.2 342

Central, Water-Cooled AC, ?65 and <135 kBtu/h

41 10.5 11.5 4 12.0 2 12.4 3 14.0 7 NA NA

Central, Water-Source HP, ?65 and <135 kBtu/h 256 10.5 12.0 32 12.5 9 13.0 17 14.0 32 NA NA

Central, Air-Source AC, 135 and <240 kBtu/h

7,270 8.5 9.7 899 10.2 312 10.4 429 10.8 649 11.5 997

Central, Air-Source HP, 135 and <240 kBtu/h

324 8.5 9.3 28 9.8 15 10.4 31 10.8 41 10.5 34

Central, Water-Cooled AC, ? 135 and <240 kBtu/h

67 9.6 11.0 9 11.1 1 11.2 1 11.3 2 11.5 3

Packaged Terminal AC, <7 kBtu/h

75 8.9 9.4 4 11.0 10 11.2 12 0.0 NA 11.6 13

Packaged Terminal AC, 7-10 kBtu/h

567 8.6 9.0 27 10.6 82 10.8 92 11.5 118 11.5 118

Packaged Terminal AC, 10-13 kBtu/h

848 8.1 8.3 27 9.9 132 10.2 150 10.5 169 10.7 181

Packaged Terminal AC, > 13 kBtu/h

488 7.8 7.9 10 9.5 80 9.8 91 10.0 100 10.0 100

Packaged Terminal HP, <7 kBtu/h

66 8.9 9.3 3 10.8 9 11.0 10 0.0 NA 11.6 13

Packaged Terminal HP, 7-10 kBtu/h

543 8.6 8.9 20 10.4 76 10.6 86 11.4 116 11.5 119

Packaged Terminal HP, 10-13 kBtu/h

647 8.1 8.2 13 9.7 98 10.0 112 10.5 136 10.7 146

Packaged Terminal HP, >13 kBtu/h

410 7.8 7.8 3 9.3 66 9.6 75 10.0 89 10.0 89

(a) SEER Rating

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.3. National Baseline Energy Consumption and Energy Savings - Space-Heating Equipment

EPCA 1992

Standard 90.1-1999

Relative to EPCA 92

Efficiency Level 1

Relative to 90.1-1999

Efficiency Level 2

Relative to 90.1-1999

Efficiency Level 3

Relative to 90.1-1999

Efficiency Level 4

Relative to 90.1-1999

roduct

2004-2030

Baseline

Consumption

(TBtu)

Thermal

Efficiency

( %)

Thermal

Efficiency

(%)

Energy

Savings

(TBtu)

Thermal

Efficiency

( %)

Energy

Savings

(TBtu)

Thermal

Efficiency

(%)

Energy

Savings

(TBtu)

Thermal

Efficiency

(%)

Energy

Savings

(TBtu)

Thermal

Efficiency

(%)

Energy

Savings

(TBtu)

Packaged Boilers, Gas-Fired, 400 kBtu/h, HW 684 75.0 75.0 0 78.0 26 79.0 35 81.0 51 88.0 101

Packaged Boilers, Gas-Fired, 800 kBtu/h, HW 1,493 75.0 75.0 0 76.0 20 78.0 57 79.0 76 88.0 221

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, HW 491 75.0 75.0 0 77.0 13 78.0 19 79.0 25 88.0 73

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, HW 324 75.0 75.0 0 78.0 13 79.0 16 80.0 20 88.0 48

Packaged Boilers, Gas-Fired, 400 kBtu/h, Steam 320 72.0 75.0 13 76.0 4 77.0 8 79.0 16 82.0 26

Packaged Boilers, Gas-Fired, 800 kBtu/h, Steam 875 72.0 75.0 35 76.0 11 78.0 32 79.0 43 82.0 72

Packaged Boilers, Gas-Fired, 1,500 kBtu/h,

Steam 402 72.0 75.0 16 77.0 10 78.0 15 79.0 20 81.0 29

Packaged Boilers, Gas-Fired, 3,000 kBtu/h,

Steam 256 72.0 72.0 0 78.0 20 79.0 23 80.0 26 82.0 31

Warm-Air Furnaces, Gas-Fired, 250 kBtu/h 7,392 75.1 77.5 237 78.5 91 79.5 180 0.0 NA 85.5 669

Warm-Air Furnaces, Gas-Fired, 400 kBtu/h 7,562 75.1 77.5 242 78.5 93 79.5 184 0.0 NA 85.5 685

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.4. National Baseline Energy Consumption and Energy Savings - Water-Heating Equipment

Standard 90.1-1999 Efficiency Level I Efficiency Level 2 Efficiency Level 3 Efficiency Level 4

EPCA 1992 Relative to EPCA 92 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999

2004-2030

Baseline Thermal Thermal Energy Thermal Energy Thermal Energy Thermal Energy Thermal Energy

Consumption Efficiency Efficiency Savings Efficiency Savings Efficiency Savings Efficiency Savings Efficiency Savings

Product (TBtu) (%) (%) (TBtu) (%) (TBtu) (%) (TBtu) (%) (TBtu) (%) (TBtu)

Storage Water Heater, Gas-Fired, 120 kBtu/h 408 78.0 80.0 13 82.0 9 82.0 11 86.0 36 94.0 64

Storage Water Heater, Gas-Fired, 199 kBtu/h 1,282 78.0 80.0 23 82.0 28 82.0 33 86.0 112 94.0 204

Storage Water Heater, Gas-Fired, 360 kBtu/h 2,188 78.0 80.0 31 82.0 50 82.0 54 86.0 189 94.0 350

Instantaneous Water Heater, Gas-Fired,

400kBtu/h 2,822 80.0 80.0 0 83.0 41 NA NA 86.0 79 94.0 168

Instantaneous Water Heater, Gas-Fired,

1,000kBtu/h 2,822 80.0 80.0 0 83.0 102 NA NA 86.0 197 94.0 420

Instantaneous Tank Type, Water Heater, GasFired, 500 kBtu/h 155 77.0 80.0 5 82.0 4 82.0 4 86.0 12 94.0 24

Electric (120 gal) 738 99.4 99.3 -7 99.4 7 NA NA 0.0 NA NA NA

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
For gas-fired storage water heaters, the estimated total energy savings from adopting Standard 90.1-

1999 is about 125 TBtu. With fully condensing units at 94% efficiency, the savings would climb to over

500 TBtu (or over one-half quad).

Based on the available information, the estimated consumption of instantaneous-type water heaters is

significant in the commercial sector. At the baseline level of efficiency, these units may consume over

50% of the total natural gas used for water heating in the commercial sector. Because ASHRAE did not

address these products in Standard 90.1-1999, the energy savings in the first set of columns is zero. As

with storage water heaters, the selection of condensing technology for these products (94% thermal

efficiency) would yield over one-half quad of energy savings.

One size of electric water heater was also analyzed. As discussed in Section 2.0, the Standard 90.1-

1999 appears to have relaxed the standby loss requirements for electric water heaters. This factor leads to

a calculated increase in energy use (negative energy savings) of a little more than 7 TBtu as shown in

Table 3.4.

3.3.3 Estimates of National NPV

National NPV provides an aggregate measure of the discounted total dollar savings to the nation from

the use of higher-efficiency equipment. For the screening analysis, the national NPV is based on the sum

of the discounted LCC savings for all 77 market segments discussed in Section 3.1. The final expression

for calculating NPV is shown in Equation 3.13 (Section 3.4.2).

Tables 3.5 through 3.7 provide a summary of the national NPV for up to four efficiency levels beyond

those in the Standard 90.1-1999.

Table 3.5 shows the NPV for cooling products. The first row of the table presents the results for 3-

phase single package cooling equipment. The "Efficiency Level 2" has the maximum NPV [897.7

million ( 1998) dollars] of the four efficiency levels considered in the screening analysis.

The higher efficiency levels for this product, at EERs of 13 and 15 show negative NPV values. In

these instances, the discounted energy cost savings from higher efficiency levels are insufficient to offset

the increase in first cost of the equipment. As is shown in the subsequent section, these results reflect the

underlying life-cycle costs that tend to increase for higher levels of efficiency. For some products, [(e.g.,

central air source AC (>_65 kBtu/h and <135 kBtu/h)] all efficiency levels beyond the Standard 90.1-1999

have a negative NPV.

Other cooling products with relatively high values of NPV for efficiency levels beyond Standard

90.1-1999 levels include large central air-source A/C equipment (>_135 kBtu/h and <240 kBtu/h) and

several of the packaged terminal A/C and HP equipment.

3.11

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.5. NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Space-Cooling Equipment

ASHRAE

90.1-1999

Efficiency Level 1

Relative to 90.1-1999

Efficiency Level 3

Relative to 90.1-1999

Efficiency Level 3

Relative to 90.1-1999

Efficiency Level 4

Relative to 90.1-1999

Product EER EER

NPV

(mill.98$) EER

NPV

(mill.98$) EER

NPV

(mill.98$) EER

NPV

(mill.98$)

3-Phase , Single-Packaged, Air-Source AC, <65

kBtu/h"t 9.7 11.0 521.6 12.0 897.7 13.0 -290.6 15.0 -2,649.5

3-Phase, Single-Packaged, Air-Source HP, <65 kBtu/h(' 9.7 11.0 88.2 12.0 91.3 13.0 -102.7 15.0 -430.6

3-Phase, Split-system, Air-Source AC, <65 kBtu/h(') 10.0 11.0 109.1 12.0 14.9 13.0 -344.4 15.0 -1,857.4

3-Phase, Split-system , Air-Source HP, <65 kBtu/h(') 10.0 11.0 36.5 12.0 47.0 13.0 27.0 15.0 -121.5

Central, Air-Source AC, _65 and <135 kBtu/h 10.3 10.5 -102.9 10.8 -362.0 11.0 -689.6 12.5 -8,623.1

Central, Air-Source HP, >_65 and <135 kBtu/h 10.1 10.5 -65.0 10.6 -86.5 11.0 -242.5 11.7 -795.9

Central, Water-Cooled AC, <65 kBtu/h 12.1 12.5 -0.4 13.1 -1.6 14.0 -6.1 12.5 -$0.4

Central, Water-Source HP, <17 kBtu/h 11.2 12.5 -18.3 13.1 -54.7 14.0 -149.9 15.8 NA

Central, Water-Source HP, >_17 and <65 kBtu/h 12.0 12.5 23.0 13.1 -8.4 14.0 -186.9 15.2 NA

Central, Water-Cooled AC, >_65 and <135 kBtu/h 11.5 12.0 0.7 12.4 0.8 14.0 -2.0 0.0 NA

Central, Water-Source HP, >_ 65 and <135 kBtu/h 12.0 12.5 -0.6 13.0 -8.3 14.0 -48.2 0.0 NA

Central, Air-Source AC, ? 135 and <240 kBtu/h 9.7 10.2 372.2 10.4 417.9 10.8 NA 11.5 NA

Central, Air-Source HP, >_ 135 and <240 kBtu/h 9.3 9.8 3.2 10.4 3.2 10.8 NA 10.5 NA

Central, Water-Cooled AC, ? 135 and <240 kBtu/h 11.0 11.1 1.1 11.2 1.1 11.3 1.7 11.5 3.0

Packaged Terminal AC, <7 kBtu/h 9.4 11.0 -2.2 11.2 -6.4 0.0 NA 11.6 NA

Packaged Terminal AC, 7-10 kBtu/h 9.0 10.6 72.2 10.8 72.0 11.5 7.4 11.5 7.4

Packaged Terminal AC, 10-13 kBtu/h 8.3 9.9 97.6 10.2 103.4 10.5 102.7 10.7 NA

Packaged Terminal AC, >13 kBtu/h 7.9 9.5 99.1 9.8 88.6 10.0 45.8 10.0 45.8

Packaged Terminal HP, <7 kBtu/h 9.3 10.8 -2.1 11.0 -6.7 0.0 NA 11.6 NA

Packaged Terminal HP, 7-10 kBtu/h 8.9 10.4 70.1 10.6 77.4 11.4 36.0 11.5 NA

Packaged Terminal HP, 10-13 kBtu/h 8.2 9.7 103.0 10.0 85.9 10.5 16.2 10.7 NA

Packaged Terminal HP, >13 kBtu/h 7.8 9.3 61.6 9.6 57.8 10.0 39.0 10.0 39.0

(a) SEER Rating

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.6 . NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Space-Heating Equipment

ASHRAE

90.1-1999

Efficiency Level 2

Relative to 90.1-1999

Efficiency Level 2

Relative to 90.1-1999

Efficiency Level 3

Relative to 90.1-1999

Efficiency Level 4

Relative to 90.1-1999

Products

Thermal

Efficiency

Thermal

Efficiency NPV

(mill.98$)

Thermal

Efficiency

(%)

NPV

(mill.98$)

Thermal

Efficiency

(% )

NPV

(mill. 98$)

Thermal

Efficiency

(%)

NPV

(mill.98$)

Packaged Boilers, Gas-Fired, 400 kBtu/h, HW 75.0 78.0 17.9 79.0 4.5 81.0 -89.4 88.0 -180.2

Packaged Boilers, Gas-Fired, 800 kBtu/h, HW 75.0 76.0 5.9 78.0 42.5 79.0 -20.3 88.0 19.6

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, HW 75.0 77.0 17.2 78.0 23.0 79.0 17.7 88.0 64.6

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, HW 75.0 78.0 16.5 79.0 19.3 80.0 24.8 88.0 55.9

Packaged Boilers, Gas-Fired, 400 kBtu/h, Steam 75.0 76.0 1.6 77.0 -8.5 79.0 -70.9 82.0 -87.8

Packaged Boilers, Gas-Fired, 800 kBtu/h, Steam 75.0 76.0 8.9 78.0 -23.8 79.0 -16.3 82.0 -78.5

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, Steam 75.0 77.0 2.8 78.0 1.8 79.0 4.5 81.0 10.5

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, Steam 72.0 78.0 21.2 79.0 24.3 80.0 27.9 82.0 30.8

Warm-Air Furnaces, Gas-Fired, 250 kBtu/h 77.5 78.5 -120.5 79.5 -244.3 0.0 NA 85.5 -3,511.5

IWarm-Air Furnaces, Gas-Fired, 400 kBtu/h 77.5 78.5 -68.9 79.5 -141.3 0.0 NA 85.5 -3,549.1

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.7 . NPV for Efficiency Levels Exceeding Standard 90.1-1999 - Water-Heating Equipment

Standard Efficiency Level 1 Efficiency Level 2 Efficiency Level 3 Efficiency Level 4

90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999 Relative to 90.1-1999

Thermal Thermal Thermal Thermal Thermal

Efficiency Efficiency NPV Efficiency NPV Efficiency NPV Efficiency NPV

Product (%) (%) (mill.98$) (%) (mill.98$) (%) (mill.98$) (%) (mill.98$)

Storage Water Heater, Gas-Fired, 120 kBtu/h 80.0 82.01 -0.7 82.0 -6.0 86.0 -229.3 94.0 -466.

Storage Water Heater, Gas-Fired, 199 kBtu/h 80.0 82.0 -2.9 82.0 -15.2 86.0 -656.4 94.0 -1,130.

Storage Water Heater, Gas-Fired, 360 kBtu/h 80.0 82.0 -7.3 82.0 -19.5 86.0 -1,121.8 94.0 -1,942.

Instantaneous Water Heater, Gas-Fired,

400kBtu/h 80.0 83.0 -113.2 NA NA 86.0 -636.0 94.0 -1,085.7

Instantaneous Water Heater, Gas-Fired,

1,000 kBtu/h 80.0 83.0 45.3 NA NA 86.0 -79.6 94.0 -314.

Instantaneous Tank Type, Water Heater, GasFired, 500 kBtu/h 80.0 82.0 -3.4 82.0 -4.0 86.0 -105.0 94.0 -160.1

Electric (120 gal) 99.3 99.4 1.1 0.0 NA 0.0 NA 0.0 NA

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
The national NPV results for heating equipment are shown in Table 3.6. The highest levels of NPV

are estimated for the highest efficiency levels for largest two size categories of hot water boilers. Total

potential cost savings to the nation is in excess of $100 million if these efficiency levels were chosen as

compared to Standard 90.1-1999 levels.

Table 3.7 displays the results of the NPV calculations for water heaters. The estimate of national

NPV is significantly positive for only one product-the larger-sized instantaneous water heater.

3.4 Life-Cycle Cost Analysis

LCC is a measure of the total cost of a unit of equipment over its lifetime, including the initial

purchase price of the equipment and the annual operating expenses. Future operating expenses are

discounted to the time of equipment purchase and summed over its expected lifetime. LCC is defined as

LCC = EQPCOST + j OPCOST(t) t

t_r (1+r)

where EQPCOST = equipment cost (purchase price)

OPCOST = annual operating expense

R = discount rate (real)

N = expected equipment lifetime (years).

LCC provides a method to evaluate the trade-off between the purchase price and the operating

expenses of a particular type of equipment. Alternative measures of this trade-off include payback period

and internal rate of return.

The annual operating expense in Equation (3.5) is generally broken into two overall categories: 1)

maintenance and repair costs and 2) energy costs. For the present screening analysis, maintenance costs

are assumed to remain constant across various equipment efficiencies. This assumption leads to the result

that any net change in LCC depends solely on the change in the purchase cost offset by the change in

(discounted) energy costs.

Based on the information in Section 3.1.1 on energy savings, annual unit energy cost can be

expressed as(a)

Annual Unit Energy Cost = Rated Capacity x FLEOH x PFUEL

Rated Efficiency

where PFUEL = price of the relevant energy source ($/kWh, $/therm, etc.).

(3.6)

(a) The equations that follow relate to the cooling and heating products. The equations for water heaters

would include a term to represent the standby losses, analogous to Equation (3.2).

3.15

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
In the present analysis, we account for changes in future fuel price, as reflected in the projections in

the Annual Energy Outlook 2000 (EIA 1999a). For a given efficiency level, Rated Efficiencyk, equipment

lifetime N, and discount rate r, we can then combine Equations (3.5) and (3.6) to yield a general

expression for LCC as

N Rated Capacity x FLEOH x PFUELt LCC(k) = EQPCOST +1 (3.7)

t=J (1 + r)t x Rated Efficiency k

where t = 0 denotes the time the equipment is installed.

LCC savings per unit of equipment is computed as the difference in the LCC between two efficiency

levels. Consistent with the discussion above, the efficiency level index (k) is assigned a value of 0 for the

baseline standard. The LCC savings associated with a more stringent standard with an enhanced

efficiency level is

LCC(k) savings = LCC(0) - LCC(k) (3.8)

3.4.1 Market Segment to National Average Results

The development of a national measure of NPV follows the same procedure used to estimate national

energy consumption and savings, namely an aggregation of results from the individual market segments.

In this case, LCC is calculated for each building type i and subcensus division j as

N Rated Capacity x FLEOH i,j x PFUELL, t

LCC(k)i = EQPCOST + Y,

J t=1 (1 + r) t x Rated Efficiency k

Note that region-specific fuel prices are used in determining LCC for each market segment.

(3.9)

A national average unit LCC can then be calculated as an appropriately weighted average of the LCC

results for the market segments. This aggregation is represented formally as:

7 tl

LCC(k)us = IIMS,, x LCC(k);j (3.10)

In contrast, an alternative summary measure of the average cost effectiveness of a particular

efficiency level relative to baseline efficiency is the change in LCC for a unit operated at the national

average number of operating hours (FLEOHus) with the national average price of energy (PFUELus)•

Using the notation in Equation (3.9), the expression for LCC at the national level for efficiency level k is

N LCC(k); s = EQPCOST + Rated Capacity x FLEOH us x PFUELus,t

,

r=1 (1 + r) t x Rated Efficiency k

(3.11)

3.16

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
In general, the existence of interactions between the FLEOH and energy prices by market segment

will lead to results from Equation (3.11) differing from those generated by Equation (3.9). Thus, the

same congruity of results between the approaches is not achieved for the LCC calculation as it is for

national energy consumption [i.e., using Equations (3.1) and (3.2)].

The market segment approach implemented in the screening analysis provides some ability to identify

and estimate the percentage of the building population (or, more specifically, final purchasers of the

commercial equipment under consideration) that is likely to experience reductions in LCC from a higher

level of efficiency and equipment cost. The segmentation approach is intended to capture some of the key

variables influencing the distribution of the LCC savings but does not try to reflect all of the factors that

may contribute to the variability. (a)

Based on the weighting specification in Equation (3.10), Tables 3.8 through 3.10 present the LCC

estimates for each efficiency level, beginning with the EPCA 92 level. The use of projected energy prices

in the screening analysis implies that the LCC for each market segment will differ to a small degree for

each year of the analysis period, 2004-2030. In the LCC tables, the LCC estimates assume the equipment

is purchased in 2010. The annual energy costs thus are based on the energy prices projected for 2010 and

extending though the expected life of the equipment [see Equation (3.7)].

Table 3.8 shows the LCC estimates for the 22 cooling products analyzed. Considerable variation in

the magnitude of the LCC across the products exists, reflecting the size and associated first cost of the

equipment. At the EPCA 92 efficiency level, a packaged terminal AC unit has an estimated LCC of

$1,377, while the LCC for a large central AC unit is over $30,000.

For the first product in the table-3-phase single-package AC equipment, the LCC declines from

$8,524 for an EER of 9.7 to $8,198 for an EER of 12.0. The nature of the cost-efficiency relationship

suggests that LCC would rise for higher efficiency levels. At an EER of 15, the analysis suggests that the

LCC would be about $1,500 higher than at the minimum point.

Table 3.9 shows the LCC at each efficiency level for the 10 heating products in the analysis. The

magnitude of the LCCs, especially for boilers, are considerably greater than for the cooling products. For

the largest class of boilers, the sum of the first cost and discounted energy costs over the assumed 30-year

life of the equipment is approximately $400,000. For these large boilers, the cost savings to an individual

consumer can be considerable.

(a) Some simple measures associated with the distribution of LCC savings by efficiency level are

generated in the screening analysis spreadsheet and are discussed in Appendix C.

3.17

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3 .8. Market Segment Weighted LCC for All Efficiency Levels - Space-Cooling Equipment

EPCA 1992 Standard 90.1 1999 Efficiency Level 1 Efficiency Level 2 Efficiency Level 3 Efficiency Level 4

LCC LCC LCC LCC LCC LCC

Product EER 98 $/unit EER 98 $/unit EER 98 $/unit EEL 98 $/unit EER 98 $/unit EER 98 S/unit

3-Phase, Single-Packaged, Air-Source AC, <65

kBtu/ht°' 9.7 8,777 9.7 8,777 11.0 8,560 12.0 8,403 13.0 8,900 15.0 9,888

3-Phase , Single-Packaged , Air-Source HP, <65

kBtu/hl°l 9.7 9,258 9.7 9,258 11.0 8,975 12.0 8,966 13.0 9,591 15.0 10,647

3-Phase, Split-system, Air-Source AC, <65 kBtu/h"' 10.0 8,643 10.0 8,643 11.0 8,537 12.0 8,629 13.0 8,980 15.0 10,458

1

3-Phase , Split-system, Air-Source HP, <65 kBtu/h(°) 10.0 8,587 10.0 8,587 11.0 8,313 12.0 8,236 13.0 8,386 15.0 9,503

Central, Air-Source AC, _65 and <135 kBtu/h 8.9 13,453 10.3 13,090 10.5 13,146 10.8 13,286 11.0 13,464 12.5 17,765

Central, Air-Source HP, ?65 and <135 kBtu/h 8.9 14,573 10.1 14,533 10.5 14,875 10.6 14,989 11.0 15,809 11.7 18,721

Central, Water-Cooled AC, <65 kBtu/h 9.3 10,621 12.1 10,027 12.5 10,073 13.1 10,236 14.0 10,804 12.5 10,073

(Central, Water-Source HP, <17 kBtu/h 9.3 2,214 11.2 2,091 12.5 2,131 13.1 2,210 14.0 2,418 15.8 NA

ICentral, Water-Source HP, >_17 and <65 kBtu/h 9.3 5,417 12.0 4,732 12.5 4,708 13.1 4,741 14.0 4,926 15.2 NA

Central, Water-Cooled AC, ?65 and <135 kBtu/h 10.5 12,728 11.5 12,486 12.0 12,409 12.4 12,400 14.0 12,712 0.0 NA

Central , Water-Source HP, >_65 and <135 kBtu/h 10.5 12,553 12.0 12,004 12.5 12,015 13.0 12,154 14.0 12,868 0.0 NA

Central, Air-Source AC,2135 and <240 kBtu/h 8.5 28,308 9.7 26,877 10.2 26,366 10.4 26,303 10.8 NA 11.5 NA

Central, Air-Source HP, ?135 and <240 kBtu/h 8.5 30,256 9.3 29,680 9.8 29,582 10.4 29,583 10.8 NA 10.5 NA

ICentral, Water-Cooled AC, >_l35 and <240 kBtu/h 9.6 28,399 11.0 27,145 11.1 26,988 11.2 26,980 11.3 26,888 11.5 26,705

I Packaged Terminal AC, <7 kBtu/h 8.9 1,467 9.4 1,441 11.0 1,452 11.2 1,473 0.0 NA 11.6 NA

Packaged Terminal AC, 7-10 kBtu/h 8.6 1,882 9 .0 1,851 10.6 1,782 10.8 1,782 11.5 1,844 11.5 1,844

Packaged Terminal AC, 10-13 kBtu/h 8.1 2,256 8.3 2,229 9.9 2,139 10.2 2,134 10.5 2,134 10.7 NA

Packaged Terminal AC, >13 kBtu/h 7.8 2,861 7.9 2,827 9.5 2,626 9.8 2,647 10.0 2,734 10.0 2,734

Packaged Terminal HP, <7 kBtu/h 8.9 1,547 9.3 1,525 10.8 1,536 11.0 1,562 0.0 NA 11.6 NA

Packaged Terminal HP, 7-10 kBtu/h 8.6 1,964 8.9 1,951 10.4 1,881 10.6 1,874 11.4 1,915 11.5 NA

IPackaged Terminal HP, 10-13 kBtu/h 8.1 2,334 8.2 2,309 9.7 2,185 10.0 2,206 10.5 2,290 10.7 NA

I Packaged Terminal HP, > 13 kBtu/h 7.8 2,921 7.8 2,909 9.3 2,760 9.6 2,770 10.0 2,815 10.0 2,815

(a) SEER Rating

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.9. Market Segment Weighted LCC for All Efficiency Levels - Space-Heating Equipment

EPCA 1992 Standard 90.1 1999 Efficient- Level 1 Efficiency Level 2 Efficient Level 3 Efficiency Level 4

Product

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(% )

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Packaged Boilers, Gas-Fired, 400 kBtu/h, HW 75.0 39,588 75.0 39,588 78.0 39,022 79.0 39,447 81.0 42,422 88.0 45,303

Packaged Boilers, Gas-Fired, 800 kBtu/h, HW 75.0 76,282 75.0 76,282 76.0 76,109 78.0 75,047 79.0 76,873 88.0 75,716

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, HW 75.0 140,462 75.0 140,462 77.0 137,621 78.0 136,656 79.0 137,536 88.0 129,770

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, HW 75.0 276,835 75.0 276,835 78.0 268,564 79.0 267,120 80.0 264,382 88.0 248,775

Packaged Boilers, Gas-Fired, 400 kBtu/h, Steam 72.0 42,890 75.0 42,130 76.0 42,016 77.0 42,732 79.0 47,134 82.0 48,320

Packaged Boilers, Gas-Fired, 800 kBtu/h, Steam 72.0 81,190 75.0 79,664 76.0 79,206 78.0 80,896 79.0 80,507 82.0 83,719

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, Steam 72.0 150,969 75.0 146,346 77.0 145,765 78.0 145,964 79.0 145,391 81.0 144,137

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, Steam 72.0 293,020 72.0 293,020 78.0 278,973 79.0 276,939 80.0 274,533 82.0 272,651

Warm-Air Furnaces, Gas-Fired, 250 kBtu/h 75.1 16,311 77.5 16,404 78.5 16,501 79.5 16,602 0.0 NA 85.5 19,242

Warm-Air Furnaces, Gas-Fired, 400 kBtu/h 75.1 25,737 77.5 25,409 78.5 125,496 79.5 25,588 0.0 NA 85.5 29,896

Table 3.10. Market Segment Weighted LCC for All Efficiency Levels - Water-Heating Equipment

EPCA 1992 Standard 90.1 1999 Efficient Level 1 Efficiency Level 2 Efficiency Level 3 Efficiency Level 4

Product

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

Thermal

Efficiency

(%)

LCC

98 $/unit

,Storage Water Heater, Gas-Fired, 120 kBtu/h 78.0 4,881 80.0 4,858 82.0 4,861 82.0 4,883 86.0 5,831 94.0 6,837

IStorage Water Heater, Gas-Fired, 199 kBtu/h 78.0 6,954 80.0 6,975 82.0 6,981 82.0 7,007 86.0 8,366 94.0 9,370

Storage Water Heater, Gas-Fired, 360 kBtu/h 78.0 11,879 80.0 11,954 82.0 11,969 82.0 11,995 86.0 14,332 94.0 16,072

Instantaneous Water Heater, Gas-Fired, 400 kBtu/h 80.0 15,857 80.0 15,857 83.0 16,192 NA NA 86.0 17,74 994.0 19,072

Instantaneous Water Heater, Gas-Fired, 1,000 kBtu/h 80.0 36,280 80.0 36,280 83.0 35,945 NA NA 86.0 36,869 94.0 38,607

Instantaneous Tank Type, Water Heater, Gas-Fired,

500 kBtu/h 77.0 16,433 80.0 16,457 82.0 16,592 82.0 16,618 86.0 20,668 94.0 22,874

Electric (120 gal) 99.4 8,001 99.3 8,056 99.4 8,052 0.0 NA 0.0 NA 0.0 NA

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
For the large boiler (>3,000 kBtu/h), the cost saving from going to a condensing model (at 88% thermal

efficiency) is nearly $50 , 000 compared with the current standard (both EPCA 92 and 90.1-1999) of

75%(a).

The LCC by efficiency level for water-heating equipment is shown in Table 3.10. The shorter

lifetimes of the storage water heaters-compared with the instantaneous type-are reflected in smaller

LCCs. Except for the large instantaneous water heater (the fifth product listed in Table 3.10), the

minimum LCC is generally at the Standard 90.10-1999 level.

3.4.2 Methodology Used to Compute National NPV

The discussion on Equations (3.7) through (3.11) focuses exclusively on the LCC and LCC savings

for a single unit of equipment. Of course, the potential national economic benefits of setting an efficiency

standard for any specific product depends on both the unit LCC savings and the size of the market (total

shipments) for that product.

Following the approach in previous analyses of national equipment efficiency standards, a convenient

summary metric of the benefits is the national NPV of the cost savings. For the screening analysis, the

method used to compute this metric first involved estimating the present value of the total LCC savings

associated with each year's shipments. (b)

At the efficiency level k, the national LCC savings (NLCCS) from total shipments in year "y"

meeting the standard can be expressed as

7 It

NLCCS(y, k) = Shipments(y) x YI

MS; i x [(LCC(y,0) i - LCC(y, k); j ] (3.12)

i j

Note that in Equation (3.12) the expressions for LCC include the year y as an argument, recognizing

that the LCC may vary for each year depending on the levels of energy prices. For the preliminary

screening analysis, the national NPV is evaluated for the year 2000 using a time horizon that extends to

2030.(a) National NPV is thus based on discounting the national LCC savings associated with each year's

shipments back to the "present" year 2000 and summing the results. Thus, we have

(a)

(b)

In all LCC discussions, an "individual" user represents the average consumer across the market

segments. Depending on climate and energy prices, some consumers would experience greater

savings and others would have smaller savings.

This analysis assumes a common discount rate that is used in the LCC calculations and in the NPV

calculation. With this assumption, the LCC savings and NPV would be the same for units shipped in

the "present" year and where the energy cost savings is discounted to this year. The "net" in the NPV

compares the present value of the purchase price offset by the present (i.e., discounted) value of the

energy savings. When applied to vintages of equipment shipments over a period of future years, the

NPV calculation recognizes that national economic benefits in these more distant future years are not

as valuable as near-term benefits.

3.20

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
2030 NLCCS(y, k)

National NP V (k) _

y=2000 ( 1+r)Y-2000

3.5 Reductions in Environmental Emissions

(3.13)

The reductions in energy consumption from the use of more energy-efficient commercial equipment

help to lower the nation's total environmental emissions associated with the burning of fossil fuels. Two

categories of emissions were considered in the screening analysis: 1) carbon (as part of CO2 released in

combustion process) and 2) nitrous oxides (NOX). The results in Table 3.11 show the estimated

reductions in carbon emissions for all products in the screening analysis. More detailed results, which

include the estimates of NOx emissions, are shown in Appendices C and D.

The factors to convert electricity and natural gas savings to reductions in these emissions were

extracted from a table used by the DOE Office of Energy Efficiency and Renewable Energy (EERE) in its

assessment of various DOE energy conservation programs (DOE 1999).

The values in the EERE table are derived from conversion factors developed by EIA. EIA, however,

provides emissions factors only for primary fuels and not for electricity. EERE has subsequently

developed emissions factors for electricity that reflect a projection of fuels that would likely be impacted

due to marginal reductions in electricity consumption.

In Table 3.11, the energy savings from adopting the Standard 90.1-1999 efficiency level, as well as a

higher efficiency level (corresponding to maximum national NPV), were translated into estimates of

millions of metric tons (MMtons) of carbon emissions reductions. The total carbon emissions reduction

from the adoption of Standard 90.1-1999 is estimated to be about 52 MMtons. An additional 51 MMtons

could be reduced by moving to the efficiency level with maximum NPV.

The Annual Energy Outlook 2000 (EIA 1999a) projects carbon emissions through 2020 for each

major end use sector (residential, commercial, industrial, transportation) consistent with their energy

consumption projections. Based on extrapolating the AEO projections to 2030 by using the 2015-2020

annual growth rate, the cumulative commercial-sector carbon emissions between 2004 and 2030 are

estimated to be about 8,100 MMtons. Thus, adopting Standard 90.1-1999 would cut total emissions over

this period by roughly 0.7%. Based on the data used in the screening analysis, an additional 0.6% could

be reduced with more stringent standards.

3.21

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.11. Energy Savings and Carbon Reductions from Adopting

Standard 90.1-1999 and from Maximum NPV

Standard 90.1 1999 Efiicienc with Maximum NPV

roduct

EER/

Thermal

Efficiency

(%)

Energy

Savings

(TBtu)

Carbon

Reduction

(MMtons)

EER/

Thermal

Efficiency

(%

Additional

Energy

Savings

(TBtu)

Additional

Carbon

Reduction

(MMtons)

Cooling Eq uipment

3-Phase, Single-Packaged, Air-Source AC, <65 kBtu/P) 9.7 0 0.0 12.0 1,413 20.8

3-Phase, Single-Packaged, Air-Source HP, <65 kBtu/h(" 9.7 0 0.0 12.0 184 2.7

3-Phase, Split-system, Air-Source AC, <65 kBtu/hW" 10.0 0 0.0 11.0 279 4.1

3-Phase, Split-system, Air-Source HP, <65 kBtu/ht' 10.0 0 0.0 12.0 66 1.0

Central, Air-Source AC, ?65 and <135 kBtu/h 10.3 1198 17.6 10.3 0 0.0

Central, Air-Source HP, ?65 and <135 kBtu/h 10.1 108 1.6 10.1 0 0.0

Central, Water-Cooled AC, <65 kBtu/h 12.1 7 0.1 12.1 0 0.0

Central, Water-Source HP, <17 kBtu/h 11.2 57 0.8 11.2 0 0.0

Central, Water-Source HP, >_ 17 and <65 kBtu/h 12.0 472 6.9 12.5 65 1.0

Central, Water-Cooled AC, >_65 and <135 kBtu/h 11.5 4 0.1 12.4 3 0.0

Central, Water-Source HP, >_65 and <135 kBtu/h 12.0 32 0.5 12.0 0 0.0

Central, Air-Source AC, ?135 and <240 kBtu/h 9.7 899 13.2 10.4 429 6.3

Central, Air-Source HP, >_ 135 and <240 kBtu/h 3 28 0.4 10.4 31 0.5

Central, Water-Cooled AC, 2135 and <240 kBtu/h 11.0 9 0.1 11.5 3 0.0

Packaged Terminal AC, <7 kBtu/h 9.4 4 0.1 9.4 0 0.0

Packaged Terminal AC, 7-10 kBtu/h 9.0 27 0.4 10.6 82 1.2

Packaged Terminal AC, 10-13 kBtu/h 8.3 27 0.4 10 2 150 2.2

Packaged Terminal AC,>13 kBtu/h 7.9 10 0.1 9 5 80 1.2

Packaged Terminal HP, <7 kBtu/h 9.3 3 0.0 9 3 0 0.0

Packaged Terminal HP, 7-10 kBtu/h 8.9 20 0.3 10.6 86 1.3

Packaged Terminal HP, 10-13 kBtu/h 8.2 13 0.2 9.7 98 1.4

Packaged Terminal HP, >13 kBtu/h

-

7.8 3 0.0 9.3 66 1.0

Heating Eq uipment

Packaged Boilers, Gas-Fired, 400 kBtu/h, HW 75.0 0 0.0 78.0 26 0.3

Packaged Boilers, Gas-Fired, 800 kBtu/h, HW 75.0 0 0.0 78 0 57 0.8

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, HW 75.0 0 0.0 88 0 73 0.9

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, HW 75.0 0 0.0 88.0 48 0.6

Packaged Boilers, Gas-Fired, 400 kBtu/h, Steam 75.0 13 0.2 76.0 4 0.1

Packaged Boilers, Gas-Fired, 800 kBtu/h, Steam 75.0 35 0.5 76.0 it 0.1

Packaged Boilers, Gas-Fired, 1,500 kBtu/h, Steam 75.0 16 0.2 81.0 29 0.4

Packaged Boilers, Gas-Fired, 3,000 kBtu/h, Steam 72.0 0 0.0 82 0 31 0.4

Warm-Air Furnaces, Gas-Fired, 250 kBtu/h 77.5 237 3.1 77 5 0 0.0

Warm-Air Furnaces, Gas-Fired, 400 kBtu/h 77.5 242 3.2 77 5 0 0.0

(a) SEER Rating

3.22

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.11 . (contd)

Standard 90.1 1999 Efficienc with Maximum NPV

roduct

EER/

Thermal

Efficiency

%)

Energy Savings

(TBtu)

Carbon

Reduction

(MMtons)

EER/

Thermal

Efficiency

(%)

Additional

Energy

Savings

TBtu)

Additional

Carbon

Reduction

(MMtons)

Water Heating Equipment

Storage Water Heater, Gas-Fired, 120 kBtu/h 80.0 13 0.2 80.0 0 0.0

Storage Water Heater, Gas-Fired, 199 kBtu/h 80.0 23 0.3 80.0 0 0.0

Storage Water Heater, Gas-Fired, 360 kBtu/h 80.0 31 0.5 80.0 0 0.0

Instantaneous Water Heater, Gas-Fired, 400 kBtu/h 80.0 0

0.0 80.0 0 0.0

Instantaneous Water Heater, Gas-Fired, 1,000 kBtu/h 80.0 0 0.0 83.0 102 1.5

Instantaneous Tank Type, Water Heater, Gas-Fired, 500

kBtu/h 80.0 5

0' 1 80.0 0 0.0

Electric (120 gal) 99.3 -7 -0.1 99.4 7 0.1

Total 52.2 50.8

3.6 Summary of Results

Several of the product categories were analyzed at different representative sizes; e.g., the screening

analysis included six different sizes of packaged gas-fired boilers with capacities <2,500 kBtu /h. Because

the EPCA 1992 level and the Standard 90.1-1999 level are for a single category of gas-fired boilers with

capacities <2,500 kBtu/h, the results presented in Table 3.3 were aggregated.

This aggregation was done for the following product categories:

• packaged terminal air conditioners

• packaged terminal heat pumps

• large gas-fired hot water boilers (>2,500 kBtu/h)

• large gas-fired steam boilers (>2,500 kBtu/h)

• small gas-fired boilers (<2,500 kBtu/h)

• gas storage water heaters (>155 kBtu/h)

• gas storage water heaters (<155 kBtu/h)

• instantaneous water heaters with tanks.

3.23

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
The efficiency levels were aggregated across the different capacities of equipment analyzed using the

baseline energy consumption as relative weights. The baseline energy consumption, the energy savings,

the NPV, and the carbon reductions were all summed up across the different capacities of the particular

equipment category. The aggregated results are presented in Table 3.12.

3.24

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
Table 3.12 . Aggregated Energy Savings and NPV for Efficiency Levels with Maximum NPV

Efficiency Level Energy Savings (TBtu) Carbon Reduction (MMtons)

Product EPCA

90.1-

1999

Max

NPV)

90.1 Over

EPCA

Max NP a

Over 90.1

90.1 Over

EPCA

Max NP "

Over 90.1

NPV')

(mill. 98$)

Central Air-Source AC (135 to 240 kBtu/h) 8.5 9.7 10.4 899.4 428.8 13.2 6.3 417.9

Central Air-Source HP (135 to 240 kBtu/h) 8.5 9.3 10.4 27.9 31.4 0.4 0.5 3.2

Central Water-Cooled AC (135 to 240 kBtu/h) 9.6 11.0 11.5 8.5 2.5 0.1 0.0 3.0

Central Air-Source AC (65 to 135 kBtu/h) 8.9 10.3 10.3 1197.9 0.0 17.6 0.0 0.0

Central Air-Source HP (65 to 135 kBtu/h) 8.9 10.1 10.1 107.9 0.0 1.6 0.0 0.0

Central Water-Source HP (65 to 135 kBtu/h) 10.5 12.0 12.0 32.0 0.0 0.5 0.0 0.0

Central Water Cooled AC (65 to 135 kBtu/h) 10.5 11.5 12.4 3.6 2.7 0.1 0.1 0.8

Packaged Terminal Air Conditioners 8.5 8.8 10.5 67.5 311.7 1.0 4.6 274.7

Packaged Terminal Heat Pumps 8.2 8.4 9.9 38.7 249.0 0.6 3.7 241.9

3-Phase, Single-Package Air-Source AC (<65 kBtu/h) 9.7 9.7 12.0 0.0 1412.7 0.0 20.8 897.7

3-Phase, Split-System Air-Source AC (<65 kBtu/h) 10.0 10.0 11.0 0.0 278.6 0.0 4.1 109.1

3-Phase, Single-Package Air-Source HP (<65 kBtu/h) 9.7 9.7 12.0 0.0 183.6 0.0 2.7 91.3

3-Phase, Split-System Air Source HP (<65 kBtu/h) 10 10.0 12.0 0.0 66.4 0.0 1.0 47.0

Central Water-Cooled AC (<65 kBtu/h) 9.3 12.1 12.1 6.6 0.0 0.1 0.0 0.0

Central Water-Source HP (17 to 65 kBtu/h) 9.3 12.0 12.5 471.6 65.0 6.9 1.0 23.0

Central Water-Source HP (<17 kBtu/h) 9.3 11.2 11.2 56.5 0.0 0.8 0.0 0.0

Large Gas-Fired Hot Water Boilers (>2,500 kBtu/h) 80% 80%x'7 880

Large Gas-Fired Steam Boilers (>2,500 kBtu/h) 80% 80% 82 0.0 79.0 0.0 1.0 86.6

Small Gas-Fired Boilers (<2,500 kBtu/h) 80°/a^ 75 78.7% 63.9 200.0 0.8 2.6 146.0

Gas-Fired Warm-Air Furnaces 805 80 800 c7 478.4 0.0 53 0.0 0.0

Gas Storage Water Heaters (>155 kBtu/h) 78% 80.4% z 80.4% 53.9 0.0 0.8 0.0 0.0

Gas Storage Water Heaters (<155 kBtu/h) 7 0 580° 800 `7 12.5 0.0 0.2 0.0 0.0

Electric Water Heaters See

Note(d)

See

Note(e)

See

Note

-7.2 5.3 -0.1 0.1 1.1

Tankless Instantaneous Water Heaters 80 8057

--

81.50/o' 0.0 102.0 0.0 1.5 45.3

Instantaneous Water Heaters with Tanks 770 800/. 80 6.9 0.0 0.1 0.0 0.0

(a) NPV = national net present value.

(b) Combustion efficiency (%).

(c) Thermal efficiency (%).

(d) Savings due to tighter jacket loss requirement.

(d) 30+27/V (%/h) V=Measured storage volume in gals.

(e) 20+35Sqrt(V) (Btu/h) V=Rated volume in gals.

(f) 1.73V+155 (Btu/h) V=Rated volume in gals.

EE-RM-STD-03-100 EE-RM-STD-03-200 EE-RM-STD-03-300 COMMENT 01
4.0 References

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Code of Federal Regulations.

Air-Conditioning and Refrigeration Institute (ARI). 1998a. Electronic Unitary Directory ARIEUD 98. ARI CDROM (I), Arlington, Virginia.

Air-Conditioning and Refrigeration Institute (ARI). 1998b. Statistical Releases, January 1998 - December 1998.

Available URL: http://www.ari.org

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Standard 90.1-1989, "Energy Efficient Design of New Buildings Except Low-Rise Residential Buildings." Atlanta,

Georgia.

American Society of Heating, Refrigerating and Air-Conditioning Engineers, Inc. (ASHRAE). 1995. Handbook of

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Laboratory, Richland, Washington.

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California Energy Commission (CEC). 1999. Cooling Equipment Database. Available URL:

http://www.energy. ca. gov/efficiency/ appliances/index.html

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Program Version 2.0. PNL-6839 , Pacific Northwest Laboratory , Richland, Washington.

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(CBECS), Public Use Data, Micro -data files on EIA website:

ft-o://fti).eia . doe.gov/pub/consumption/commercial/micro.data/

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(CBECS), Public Use Data, Micro-data files on EIA website : http://www.eia.doe. gov/emeu/cbecs/microdat.html

Energy Information Administration (EIA). 1999a. Annual Energy Outlook 2000. DOE/EIA-0383(2000), U.S.

Government Printing Office, Washington, D.C.

4.1

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Energy Information Administration (EIA). 1999b. Supplement Tables for the Annual Energy Outlook 2000 on EIA

website: www.eia.doe.gov/oief/aeo/supplement/index.html, Tables 11-20. U.S. Department of Energy, Washington,

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4.2

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