M&amp V - IPMVP Transcript

Measurement and Verification with IPMVP
Energy University Course Transcript

Slide 1
Welcome to Measurement and Verification: Including IPMVP (International Performance Measurement and
Verification Protocol).
Slide 2
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normal play of the course. Click the paperclip icon to download supplemental information for this course.
Click the Notes tab to read a transcript of the narration.
Slide 3
At the completion of this course, you will be able to:
 Explain the principle of measurement against an adjusted baseline
 Describe different approaches to measurement and verification and identify suitable cases for
using each one
 Explain the role of guidelines such as IPMVP, and those from the US Department of Energy and
ASHRAE
Slide 4
Measuring energy efficiency is an exercise in quantifying what’s not there. Savings are the lack of energy
use – and we can’t measure what we did not use. We can measure what we DID use, and calculate the
change in usage. But unfortunately change does not equal savings.
Slide 5
An energy efficiency project may be performed at the same time as a major change in production level, or a
change in the weather. How much of the measured change in use was due to the energy efficiency project,
and how much was due to the changes in production or weather? How can you be sure that your project is
delivering expected results and return on investment? Increasingly, senior managers want good answers to
these questions. And, if you intend to borrow money to fund your energy efficiency equipment purchases,
lending institutions may be reluctant to provide funds unless you can clearly show how you will measure and
verify energy savings.
Slide 6
Measurement and verification can be defined as the process of measurement to determine the actual
savings created by an energy management program or energy conservation improvements. The savings
are expressed in both units of energy and the financial impact of the savings.
Slide 7
Why are we interested in measurement and verification?
Measurement and verification make sense for many reasons:
 It provides accurate feedback over time to ensure savings are sustained and not lost and highlights
opportunities for improvement
©2012 Schneider Electric. All rights reserved. All trademarks provided are the property of their respective owners.
 It aids facility managers in ensuring efficient maintenance and operations to minimize utility
expenditures
 It documents the financial aspects of energy conservation improvements, which is commonly of
value internally, but also -
 Provides the credibility to improve the prospects of acquiring financing for energy conservation
projects – and may even allow for financing projects that may not meet the company standards for
payback
 It provides the ability to weigh and reduce risk of performance contracts
 It can also be of assistance for utility budgeting and
 May be required when reporting energy savings for regulatory compliance, or to participate in
emissions trading
Slide 8
The fundamental principles of good measurement and verification include the following, (in alphabetical
order):
 Measurement and verification reports should be as accurate as the budget will allow
 The reporting of energy savings should consider all effects of a project
 Where judgments are made about uncertain quantities, measurement and verification procedures
should be conservative
 The reporting of a project’s energy impact should be consistent over time, repeatable, and
duplicate-able
 However, consistent does not mean identical—measurement and verification requires judgments
which may not be made identically by all reporters
 Relevant—the determination of savings should measure the performance parameters of concern,
while other less critical or predictable parameters may be estimated and finally,
 Transparent—measurement and verification activities, estimates, etcetera should always be
disclosed
Slide 9
The Efficiency Valuation Organization or EVO, (formerly the IPMVP committee) has published an
International Performance Measurement and Verification Protocol. EVO originated as a committee under a
United States Department of Energy initiative. It is now a non-profit US corporation with worldwide
membership and influence.
In addition to the measurement and verification protocol, they have also developed the International Energy
Efficiency Financing Protocol (IEEFP). Through this protocol, EVO educates local financing institutions on
how energy savings can generate cash flow to repay energy efficiency loans. Measurement and verification
is key to the forecast of the cash flow. IPMVP guidelines and up-to-date information are available from their
website: http://www.evo-world.org.
Slide 10
It’s important to note: that IPMVP is not intended to prescribe contractual terms between buyers and sellers
of efficiency services, but rather to help in the selection of a measurement and verification approach that
best matches the project costs and savings magnitude, technology specific requirements, and risk allocation
between the buyer and seller.
To download more information on IPMVP, click the paperclip icon. (Located in the lower right hand corner of
your toolbar.)
Slide 11
Worldwide, many organizations have adopted IPMVP, or in some cases, defined their own guidelines. The
European Committee for Standardization participates with the EVO-World on IPMVP revisions.
Numerous European countries are members of the European Committee for Standardization—also known
as CEN, and you can find more information at their website:
http://www.cen.eu/cenorm/homepage.htm
Additionally, the Australian Energy Performance Contracting Association has published a Best Practice
Guideline that refers to the IPMVP. Here is their website for more information:
http://www.aepca.asn.au
Slide 12
The U.S. (United States) Department of Energy's Federal Energy Management Program (FEMP) has
published ―Measurement and Verification Guidelines for Federal Energy Projects‖. This guideline was
updated in April of 2008.
The FEMP guidelines are mostly consistent with the IPMVP guidelines, but are focused on and required for
U.S. federal government projects. You may obtain a copy of the publication via the Federal Energy
Management Program website. (http://www1.eere.energy.gov/femp/)
Slide 13
ASHRAE also provides measurement and verification guidelines in their Guideline 14, 2002 publication:
Measurement of Energy and Demand Savings. This publication is highly technical, and is available for
purchase via the ASHRAE website: www.ashrae.org.
ASHRAE is the American Society of Heating, Refrigerating and Air-Conditioning Engineers. Although the
group has ―American‖ in the title, it is an influential international organization. The ASHRAE standard and
IPMVP are fully complementary and many of the authors of both documents were the same. In fact, the
IPMVP refers to ASHRAE Guideline 14. Although IPMVP uses some different names for the options, in a
nutshell; IPMVP requires you to have a measurement and verification plan—following a set of best practices.
So, if you used the ASHRAE guideline to fulfill those best practices, that would be acceptable under IPMVP.
Slide 14
We are going to dig further into IPMVP. Energy Managers for large scale facilities—like universities and
manufacturing complexes—use the principles found in IPMVP to forecast budgets and verify effective facility
operation.
They need to be able to report if budget variances are caused by operation, weather, production levels, or
utility rates. And, they need to be able to forecast what the utility budget will look like if, for example, the
weather is severe or mild.
Slide 15
IPMVP compliant M & V is frequently required by the financier of a performance contract. In the case of a
performance contract, the measurement is primarily focused on determination of savings from energy or
water conservation as well as efficiency programs, and alternative energy projects.
The measurement and verification plan helps to identify areas of risk associated with these programs.
These risks are defined in the contract between participants. Energy conservation and efficiency projects,
as well as alternative energy projects have two elements: performance and operation.
Slide 16
In this context, performance of the project is related to its efficiency, defined with a metric: such as
improvements in lumens per watt or in tons of cooling per kilowatt of demand.
Operation of the project is related to its actual usage, defined by operating hours, tons hours, etcetera and
can be associated with conservation.
Because conservation involves the frugal or careful use of resources. An easy way to think about it is ―Doing
Less to Use Less‖.
 Such as turning the lights out when we leave a room
Efficiency, on the other hand, refers to using fewer resources for the same result—or ―Doing More With
Less‖.
 Such as replacing an old, inefficient chiller with a new, high-efficiency chiller
The measurement and verification plan should identify the variables that affect energy use, consumption,
and costs before the project is implemented. Variables controlled by the energy service company—or
ESCO—include retrofit design and performance; and owner-controlled variables include facility
characteristics and operations. ESCO and/or owner-controlled variables include maintenance. Variables that
are outside of either party’s control include the weather, energy prices, and natural disasters.
Slide 17
What’s the purpose of identifying those variables? It is so that they can be used to correctly adjust the
baseline. Savings cannot be measured directly. Savings are equal to the baseline energy use, measured
before the improvements, minus the post-retrofit energy usage, with adjustments. The baseline is what the
energy costs would have been if the retro-fit had not been implemented.
How do you know what the energy costs would have been without the retrofit? By analyzing the relationship
between the energy use and the variables, and adjusting the baseline during the reporting period. ASHRAE
Guideline 14 provides in depth technical information about these calculations.
The fundamental equation for savings in IPMVP is

Savings = (Baseline Period Use or Demand – Reporting Period Use or Demand) ± Adjustments
Let’s look at this further.
Slide 18
Here is an example showing a static baseline – the energy consumption that was measured during the
baseline period of 2008. During most of 2009, the site consumed more energy. Has the energy
conservation measure failed?
Here’s some additional information that may be relevant: the heating degree days for each month.
Heating degree days are based on the difference between the average actual outside air temperature and
the threshold at which heating is required. For example, if one day the average outside temperature is 5°
below that threshold, that would be five heating-degree-days. If for 10 days the average temperature was
7° below that threshold, that would be 70 degree-days.
It should be noted that, globally, there are many ways to calculate heating and cooling degree days; but the
idea of what they measure or indicate is consistent. The measurement and verification plan should indicate
how these calculations will be performed.
Note that several months of 2009 were colder and had greater heating needs than 2008. That’s interesting,
but how do we use that information to adjust the baseline?
Slide 19
One method of modeling or calculating the baseline is by a regression analysis. Here, each dot represents
an actual measurement from the baseline year. For example, this dot is an actual measurement of a week
where a certain number of heating degree days were measured, and a certain energy consumption was
noted. The line is the best fit through the dots.
In this case, it’s a linear relationship as expressed by this equation: y = mx + c

Where
―y‖ is the energy consumed
―m‖ is the angle of the line
―x‖ is the heating degree days, and
―c‖ is the axis intercept
These models are not always linear, but can be curves or other shapes. This model showed a simple
relationship between two factors: energy use and heating degree days. Keep in mind that models may also
include multiple factors.
Slide 20
How do we use this to make an adjustment to the baseline? Let’s analyze a single point. For January 2009,
we know how many heating degree days there were. That’s our first input. Using our analysis, we can
determine how much energy would have been required to provide that much heating. That’s the output from
the model analysis, which gives us our adjusted baseline. We can compare this to the second input, which
is the actual consumption in January 2009. The difference between the two is the resulting energy savings.
Slide 21
The adjusted baseline determined from the analysis is the energy consumption that would have resulted if
no energy retrofits had taken place, based on the 2008 performance data and 2009 heating conditions. We
can see here the effect of the colder weather. The adjusted baseline shows the building would have
consumed more energy. Due to the efficiency improvements, 2009 performance was actually better than
previous years.
Slide 22
Adjustments typically fall into two categories: routine and non-routine. Routine adjustments are adjustments
for changes in parameters that can be expected to happen throughout the post-retrofit period, and for which,
a relationship with the energy use/demand can be identified. These are often seasonal or cyclical.
Slide 23
Non-routine adjustments are adjustments for changes in parameters which cannot be predicted and for
which a measurable impact on energy use/demand is expected. For example, the addition of a new
production line, or opening up new space in a facility.
Slide 24
Are there occasions where measurement and verification may not be required? There are, and in this case,
the alternative to measurement is stipulated savings. Stipulation is, technically, not a form of measurement
and verification. Stipulation may be used in a contract between a customer and an energy service company
when the magnitude of the savings is sufficiently small or the performance parameters are well known to all
parties, and it doesn’t make sense to pay for measurement and verification. The savings are agreed upon
by both parties prior to the project based on engineering calculations, measurements and assumptions. The
savings are stipulated in the contract and no measurement and verification is performed. Stipulated savings
are not guaranteed. If the project is small, this may be an acceptable option—and while there is no cost, the
owner assumes all of the risk for the savings with this approach.
Slide 25
There are a few different ways to approach measurement and verification. Let’s look at those included in
IPMVP. There are basically two approaches: Retrofit isolation and whole facility. Retrofit isolation is used
when measurements can be taken from a specific device or system. It requires you to define a
measurement boundary for the specific energy conservation measure. Whole facility approaches are used
when there many energy saving measures that interact or affect multiple systems. How do you choose the
right method for you? Decide what you are concerned about. If you want to manage your total energy use,
select the whole facility method. If you want to assess a particular retrofit, select the retrofit isolation method.
Let’s talk a little more about these methods.
Slide 26
There are different options for each method, which allows flexibility for various situations.
 Option A is retrofit isolation with key parameter measurement

 Option B is retrofit isolation with all parameters measurement
 Option C is whole facility measurement
 Option D is calibrated simulation which can be applied to a whole facility or to a specific device or
system
Because each of these have best fit applications, let’s take a look at the suitability for each approach.
Slide 27
Option A, retrofit isolation with key parameter measurement, determines the savings by measuring key
parameters of the energy saving action. The measurements are taken at a boundary that isolates the
retrofit that you are trying to measure from other systems. The key parameters that are selected are the
ones that drive the energy use of the affected systems. Parameters that are not selected for measurement
may be estimated.
Slide 28
For example, if a lighting project is being evaluated with this method, you might measure the power
consumed by the lighting fixtures before and after the retrofit. You might estimate how many hours per year
the lights will be operated, by collecting the data about the opening hours of the building. Based on this, the
energy quantities can be calculated—and you will use this to define the baseline—and the energy used
during the reporting period, to identify the savings.
Slide 29
How do you know which parameters to measure and which to estimate? Using option A, you measure the
parameters for which you don’t have good data. For example, if the power consumption of the lights is well
known, but the operating hours are not well known; Option A would require you to measure the operating
hours, since you do not have the data to be able to estimate them. This helps to make option A cost-
effective; you only spend on measurement for the factors that are uncertain. Parameters that are well
known can be estimated at a lower cost than measurement. Option A is well suited to cases where the
measurement boundary can be clearly defined and uncertainty created by the estimates is acceptable to the
owner.
Slide 30
Option B, retrofit isolation with all parameter measurement requires measurement of all the energy
quantities, or all the parameters needed to calculate energy. In other words, it does not allow for the
estimation of any factor that significantly affects the energy consumption. Again, a measurement boundary
is defined to keep the retrofit in isolation from other devices or systems. Measuring devices are put in place
for the baseline period and capture energy use or other parameters.
The measuring devices either remain in place or are brought back periodically during the reporting period
and capture the ongoing energy use and parameters for comparison with the baseline.
Slide 31
Option B is generally more expensive than option A, because now any relevant parameter has to be
measured, not estimated. The complexity of the metering required can be greatly increased. However, if
the energy consumption of the device or system varies a lot due to unpredictable factors, like weather, or
variable operating hours, option B will tend to provide more certain results. It is important to note that
improving the certainty or accuracy of the savings calculations results in increased cost.
Slide 32
Option B is well suited:
 When the measurement boundary can be clearly defined
 When the meters for measurement can also be used for tenant billing or feedback to operators
 When the risks of errors due to estimation are high and,
 When measuring all the parameters is less expensive than computer simulation
Slide 33
Both option A and B may make use of spot measurements, as well as use continuous measurements. Spot
measurement works well for loads that are constant, such as lighting, and electric motor replacements.
With a constant load you can take just one measure, and be confident that the load will use the same
amount of energy whenever it is powered on. Spot measurement also tends to be used for small projects
where measurement and verification costs are difficult to justify and at times when the most important thing
is to confirm if an installation has been done or not. Over a period of time, savings extrapolated from a spot
measurement will be less accurate than those monitored with continuous measurement. This measurement
technique therefore requires the owner to be willing to assume more risk on the savings.
Slide 34
It’s a good idea to select a continuous measurement option when you have a variable load, for example
HVAC. Continuous measurement is well suited for large projects — meaning those where the stakes are
high and the measurement and verification costs are both justified, and can be absorbed. Continuous
measurement is a better option for an owner who is not willing to assume the savings risk. Because
continuous measurement must be conducted over a period of time, this option is used when there is time
available for a baseline measurement.
Slide 35
This approach measures the energy use or other parameter continuously for as long as necessary to
establish a baseline. The measurement period should be no less than one cycle of the facility. This may be
one year for a seasonal cycle; or it may be a single shift if the facility is a manufacturing plant and the
greatest energy effect is production—not weather. The measurement then remains in place during the
reporting period, for comparison to the baseline. An example of continuous measurement would be metering
on an HVAC fan using a variable speed drive. The meter would be put in place for a baseline period to
determine how much energy the fan uses without the drive. Once the drive is in place, the meter continues
measuring and shows how much energy the fan is consuming following the retrofit.
Slide 36
Let’s make sure we understand the difference between option A and B. Here’s an example of a 200 kW
motor, which runs 8 hours per day, 200 days per year. It’s replaced by a new 130 kW motor. In option A,
spot measurement was used to record the power drawn by the motor before it was replaced. After the
retrofit, another spot measure was taken to confirm the new power draw. The utilization was well known, so
it was estimated rather than measured, and calculated to be 1,600 hours per year. The total energy savings
are therefore equal to the reduced power consumption times the operating hours, and add up to 112,000
kWh.
Another factory faced the same situation, replacing a 200 kW motor with a 130 kW alternative. But the
motor runs intermittently, and they are not sure how many hours it runs per year. However, they do have a
year of sub-meter data, so they know the total consumption over the previous year was 320,000 kW, and
they take this as the baseline measurement. After the motor is replaced, they continued to monitor the
consumption with the meter. Over the next year, the meter assessed a consumption of 208,000 kWh. The
calculated savings were therefore once again 112,000 kWh.
Note that these examples are rather simple, because no adjustments were needed to the baseline.
Slide 37
If the energy conservation measures are highly interactive and affect multiple systems—like HVAC
improvements combined with building management systems, it may be very difficult to isolate systems for
measurement using option A or B. Option C is an approach that determines savings at the level of the
whole facility, or a major section if a boundary can be established.
This approach typically relies on continuous measurement using the facility main meter. Although energy
data may be collected from the utility bills, there are some pitfalls. Utility bills may include estimated data
that can introduce errors into the M & V process.
Slide 38
Since this approach is measuring a whole building, it will generally be less sensitive than measurement
using retrofit isolation. For this reason, the expected savings should be more than 10% when the reporting
period is less than two years. This approach is well suited for the owner who is not willing to assume all of
the savings risk, however this approach does not allow for performance tracking of individual energy
conservation measures (ECM).
Slide 39
A calibrated simulation is another method available when there are multiple or interactive improvements. It
can be used for any energy conservation measure, but is generally only used when one of the other options
are not feasible. A computer model is used to simulate the consumption of the building. This model is
calibrated by comparing the results of the model to a set of data including energy measurements,
independent variables (such as production level or temperature) and static factors (which are variables that
typically change slowly if at all, such as occupancy). After that the model is used to provide both the
baseline and the post-retrofit energy usage. This approach is best applied when there is no available
metered data, but the project is large enough to justify and absorb the simulation costs. Since this method
relies on the model—and not the measurement—the owner has to be willing to assume the risks that the
real savings may not match the model.
Slide 40
Let’s take a moment and review the four basic options of measurement and verification:
 Retrofit Isolation with Key Parameter Measurement: Savings are determined by field measurement
of the key parameters that define the energy use of the system to which an ECM was applied—
separate from the energy use of the rest of the facility. Other parameters are estimated.
 Retrofit Isolation with All Parameter Measurement: Savings are determined by field measurement
of the energy use of the system to which the ECM was applied—separate from the energy use of
the rest of the facility. There is no estimation.
 Whole Facility: Savings are determined by measuring energy use at the whole facility level or sub-
facility level and finally,
 Calibrated Simulation: Savings are determined through simulation of the energy use of the whole
facility or of a sub-facility
Slide 41
Choose the most reasonable method for measuring the equipment/facility—the goal of measurement and
verification is to produce information that is more valuable than the cost to obtain it. For the purpose of
isolating and quantifying energy conservation measure payback, energy conservation measures with short
paybacks should require less measurement and verification.
Slide 42
The method should be
 Fair to both parties
 Agreed upon by both parties
 Accurate, and
 Fully understood by both parties
At a minimum, the method should monitor energy consumption to verify the energy conservation measure is
operating and reducing consumption or costs—as best shown through a rolling summary chart.
Slide 43
One thing we need to keep in mind, is that the measurement and verification cost directly affects the project
economics. It’s a fine line we need to walk between cost and accuracy. We need to answer the question:
―How much measurement and verification is actually worthwhile?‖
Slide 44
IPMVP recommends spending no more than 10% of the savings on measurement and verification.
However, please be aware that if the M & V activity is part of a performance contract, the contract may
include other components in addition to M & V, such as technical support, maintenance services, monitoring
contractual compliance, etcetera. The cost of all these activities may aggregate to more than 10% of
savings.
Slide 45
In addition to measuring and verifying energy savings, other activities are required to get the full savings
picture. The financial value of your savings will depend on how much you pay for energy, and how those
payments are calculated.
To forecast or express the energy savings in financial terms, you’ll also need to consider:
 Evaluation of rate structure
 Tariff options, and
 Price stability to support the project over the long term
Furthermore, an energy saving project may also bring non-energy or operational savings. For example,
some lighting retrofits reduce the need for maintenance time on changing lamps. If you wish to include
those types of savings you will need to consider how to evaluate them. Note that in some regions it is not
legal to include operational savings in a performance contract.
Slide 46
Let’s end our discussion with a brief summary. Today we explained the principle of measurement against an
adjusted baseline. We looked at four different approaches to measurement and verification and identified
suitable cases for using each one. We looked at the IPMVP guidelines, and also looked at the role of other
guidelines such as those published by the US Department of Energy and ASHRAE.
Slide 47
Thank you for participating in this course.

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Measurement and Verification with IPMVP

Energy University Course Transcript

The fundamental equation for savings in IPMVP is

Let’s look at this further.

In this case, it’s a linear relationship as expressed by this equation: y = mx + c

Let’s talk a little more about these methods.

 Option A is retrofit isolation with key parameter measurement

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