APPENDIX 8A. USER INSTRUCTIONS FOR LIFE CYCLE COST SPREADSHEET

TABLE OF CONTENTS

8A.1 Introduction................................................................................................................... ... 8A-1

8A.2 User Instructions fo r LLC Spread sheet............................................................................ 8A-1

LIST OF TABLES

Table 8A.2.1 Description of Tabs in the Life-Cycle Cost Spreadsheet............................... 8A-1

8A-iAPPENDIX 8A. USER INSTRUCTIONS FOR LIFE CYCLE COST SPREADSHEET

8A.1 Introduction

Appendix E contains instructions to examin e and reproduce the detailed results of the life-cycle cost (LCC) and payback period (PBP) analyses for beverage vending machine (BVM) equipment. This analysis is performed using a Microsoft Excel spreadsheet available on the U.S. Department of Ener gy’s website at: http://www1.eere.energy.gov/buildings/applian ce_standards/residen tial/central_ac_hp.html

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8A.2 User Instructions for LLC Spreadsheet

The spreadsheet is called “CAC_LCC_Pre NOPR_03-18-10_yyy_topost.xls” where yyy indicates whether the spreadsheet addresses Coil-Only systems or Coil and Blower systems. It allows the user to perform LCC analyses of any of seven equipmen t classes CAC and CHP equipment, of which four are active—Split System A/C, Split System HP, Single-Package A/C and Single Package HP. To fully execute in sensitivity mode the spreadsheet requires only Microsoft Excel software. To fully execute in uncertainty mode, the model also requires commercially-available Crystal Ball ®

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The spreadsheet posted on the DOE website repres ents the latest version of the applicable model and has been developed and tested with Microsoft Excel 2003. The LCC spreadsheet or workbook consists of the following tabs as described in Table 8A.2.1.

Table 8A.2.1 Description of Tabs in the Life-Cycle Cost Spreadsheet

Notes Notes on changes to this model since the advance notice of proposed rulemaking (ANOPR)

Instructions Instructions for use of the model

Revision Notes Provides a history of changes that have been made to the model Split AC Replacement

Scenarios Split-System air conditioners have system components that can be replaced separately. Most depend on a furnace fan to circulate air. The need to replace the A/C condenser (outside unit) can be combined with a decision to replace the furnace. This sheet specifies assumed scenarios for furnace replacement. For Coil-Only system replacements, the air handling unit (furnace fan) is not

included. Split AC Costs This sheet provides data and calculations for purchase and installation of asystem for various efficiency levels (SEER levels). The cost curve for a coilonly system shows higher costs to meet a given SEER than if both coil and

blower are considered.

Furnace This sheet shows the expected life and percent of furnaces reaching retirement, based on age of the furnace. Replacement Costs This sheet assigns equipment price and installation costs based on whether or not early costs of furnace replacement are considered in the cost of air conditioner replacement. These costs are not cons idered in the cost of coil-only replacements. Equip Price, Repair, Mntc This sheet estimates equipment price, tran sportation costs, installation costs, and repair and maintenance costs based on equipment class and SEER level.

Names 5-06-2009 This sheet describes the purpose of named ranges in the model

CB Statistical Results .TWhen the model is run in Crystal Ball this sheet captures regional summary statistics (e.g., mean median, 5 th ,25 th , 75 th , and 95 th percentiles) on key model outputs (installed costs, annual energy use and operating costs, LCC and

8A-1payback period) from the distributions of model results.

Table 8A.2.1 (contd) Description of Tabs in the Life-Cylce Cost Spreadsheet Summary Contains the input selections and a summary table of regional energy use, elements of regional installed cost, regional annual operating costs, and regional results for LCC and payback period.

Labels This is used as a go-between for user inputs and the rest of the tabs—do not modify this sheet.

National Variables This sheet provides values for input data that only varies at the national level— wholesale and contractor markups, purchaser discount rates. It also determines from probability distributions whether any given sale of AC equipment is new or replacement and whether it is being installed in a residential or commercial building. Commercial Int. Processing This sheet provides regional calculations for year 2016 projected annual energy use, heating and cooling bills based on data concerning the equipment class, location and projected efficiency of individual commercial installations of AC and HP equipment.

Commercial Sim Results This sheet queries the database of individual commercial equipment locations for an equipment type and provides information on current cooling and heating energy consumption and annual cooling and heating bill (based on 8760 hours with price variation by time of use, where relevant) by efficiency level (SEER level) Residential Int. Processing This sheet provides regional calculations for year 2016 projected annual energy use, heating and cooling bills based on data concerning the equipment class, location and projected efficiency of individual residential installations of AC and HP equipment. Input Data on kWh Use, Price This sheet queries the database of individual residential equipment locations for an equipment type and provides information on current annual cooling and heating energy consumption and average and marginal cost for cooling and heating by efficiency level (SEER level) by region for individual observations. Costs Workup Uses equipment class and locations, national and regional markup factors, sales tax rates and average manufacturer sales prices (including delivery charges) by efficiency level to calculate delivered equipment prices by efficiency level by region for individual observations.

Base Install Costs Contains national average data on components of installation costs for each equipment class. Calculated Regional Indices Contains factors for calculating regionalized values for wholesale and contractor markups, sales taxes, and installation costs for individual observations. First Cost Region Vals. Provides projected values for new and replacement installation costs, annual repair costs, and annual maintenance costs for individual observations by efficiency level.

State-Level Variables and

Wts. Provides data and likelihood of wholesale markup index, contractor markup indices, sate and local sales tax index, and installation cost index for individual states. Used to calculate markups and other indices for individual observations in the Calculated Regional Indices tab.

Chart Res Prices Chart of real price indices for future escalation of electricity prices in the

residential sector.

Chart Commercial Prices Chart of real price indices for future escalation of electricity prices in the

commercial sector. Energy Price Escalation Translates scenario projections of future energy prices from the Annual Energy Outlook into average real residential an d commercial electricity price indices.

Discount Rate Contains data from which an average discount rate and a distribution of discount

rates are determined for residential and commercial consumers. Summary Cost of Capital Contains the commercial firm financial data and calculations used to estimate a weighted average cost of capital and discount rate for commercial consumers.

Lifetime Contains the calculations for the survival function for central air conditioning

8A-2and heat pump units (lifetime in years).

Basic instructions for operating the LCC spreadsheets are as follows:

To execute the spreadsheets fully you will need Microsoft Excel and Crystal Ball, Version 7.0 or later. The spreadsheet can be run in sensitivity mode using only Excel.

1. Once you have downloaded the LCC file from the Web, first open Crystal Ball and then open the file inside of Crystal Ball using Excel. At the bottom, click on the tab for sheet Summary.

2. Use Excel’s commands at the top View/Zoom to change the size of the display to make it fit your monitor.

3. The user interacts with the spreadsheet by clicking choices or entering data using the graphical interface that comes with the spreadsheet. Choices can be selected from the various inputs listed under "User Options" heading.

Under the "User Options" heading select choices from the selection buttons and boxes for the following: (1) Uncertainty option (2) el ectricity price projection, (3) start year, (4) equipment class (and capacity), (5) installation option (currently limited to only new units). (6) level of any cost-reducing measures such as Federal tax credits.

4. To change inputs listed under “User Options” either select the input you wish to change by either clicking on the a ppropriate button or selecting the appropriate input from the input box.

5. Crystal Ball results may be saved by using the options in Create Report and Extract Data

functions on the Control Box window.

To run a Crystal Ball simulation, do the following:

To produce Monte Carlo results using Crystal Ball, you need simply select Run from the Run menu (on the menu bar). To make basic changes in the run sequence, including altering the number of trials, select R un Preferences from the Run menu. After each simulation run, the user needs to select Re set (also from the Run menu) before Run can be selected again. Once Crystal Ball has completed its run sequence it will produce a series of distributions. Using the menu bars on the distribution results it is possible to

obtain further statistical info rmation. The time taken to complete a run sequence can be reduced by minimizing the Crystal Ball window in Excel. Ten thousand runs is the default number of runs for this analysis.

A step-by-step summary of the procedure, for running a distribution analysis, is outlined

below:

1) Find the Crystal Ball toolbar (at top of screen)

2) Click on RUN

3) Select Preference and choose from the following choices:

8A-3a) Monte Carlo b) Latin Hypercube (recommended) c) Initial seed choices and whether you want it to be constant between runs d) Select number of Monte Carlo Trials (we suggest 10,000).

4) To run the simulation, follow the following sequence (on the Crystal Ball toolbar)

RUN

RESET

RUN

5) Now wait until the program informs you that the simulation is completed. Depending on the speed of your computer, this takes only a few minutes (typically, about 90 minutes on a Pentium 5 machine for 10,000 runs).

Crystal Ball Results

1) After the simulation has finished, to s ee the distribution charts generated, click on

the Windows tab bar that is labeled Crystal Ball.

2) Several of the variables of interest, including life-cycle cost, the life-cycle cost savings, and the payback periods are defined as Forecast cells. The frequency charts display the results of the simulations, or trials, performed by Crystal Ball. Click on any chart to bring it into view. The charts show the low and high endpoints of the forecasts. The View sel ection on the Crystal Ball toolbar can be used to specify whether you want cumulative or frequency plots shown.

3) To calculate the probability that LCC savi ngs will occur, either type 0 in the box by the right arrow, or move the arrow key with the cursor to 0 on the scale. The value in the Certainty box shows the likelihood that the LCC savings will occur. To calculate the certainty of payback period being below a certain number of years, choose that value as the high endpoint.

4) To generate a printout report, select Create Report from the Run menu. The toolbar choice of Forecast Windows allows you to select the charts and statistics you are interested in. For further inform ation on Crystal Ball outputs, please refer to Understanding the Forecast Chart in the Crystal Ball manual. Crystal Ball results also may be saved to a separate Excel spreadsheet by using the Extract Data function under Analyze on the Control Panel window.

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