Performance-Based Standard for CO2 Quantification in Energy Development

1. IEEE International Practices for Energy Development & Power Generation Committee - Standards Project 1595A Performance Based Estimation and Measurement Standard to Quantify GHG Emission Credits Panel presentation: by: Rich D’Aquanni Applied Resources Group Inc. Brookline, MA USA presented at: IEEE SM2002, Chicago CCWG Panel Session, July 23, 2002

2. A Performance Based Estimation and Measurement Standard to Quantify CO2 Fundamental Challenge to Standards P1595 Dispersed - Unique Real Mitigation Efforts need to be Quantified Dispersed - Demand Side & Supply Side Demand - DSM, Conservation, Renewables Supply - Cleaner and zero emission Converted & New Power Plants

3. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Other Big Challenge • Separate out the viable mitigation initiatives from others to save finite IEEE Committee and Task Force Resources • Examples of Sincere Efforts (RTD) in addition to Kyoto • US State mandated Renewable Portfolio Standard programs in approximately 13 states • UK Volunteer Emission Trading System began in 2002, based on CO2 auction pricing • Norway & Rumanian emission trading initiative • Green Power system development & operation funded with pooled CO2 violator fees • NH, USA legislation open to emission trading and use of utility DSM $ for BACT • Sustainable Green Building (LEED) /Manufacturer (ISO-14001 Standard) Initiatives • with Compliance Certification • Performance based (ESCO/Arbitrage) C&LM and renewable energy projects at public • & private facilities worldwide • .

4. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Focus and principles to apply to meet the Challenge • Focus - quantify tons of Power Plant CO2 emission reductions • Behind meter - build upon the best DSM/ESCO M&V protocols • Quantify new generation from Renewable Energy utilization • Understand and engage meter hardware and estimation software • Identify viable regulatory programs and marketplace initiatives

5. A Performance Based Estimation and Measurement Standard to Quantify CO2 Example CO2 reduction from Simple conservation implementation Simple (yes) Deterministic (hardly) Replace 100 incandescent light bulbs by 100 Compact Florescent Lamps (CFL) January 1 2000. A savings of 2,000 kWh in the Winter 1,250 kWh in the summer and 3,250 kWh in the spring and fall were predicted. This resulted in a pay from savings contract and customer and ESCo were happy. Impact on CO2 mitigation with Using a supply - demand multiplier of 1.1 and referring to the conveniently available ISO-NE 2000 NEPOOL Marginal Emission Rate Analysis for 2000, we predict that the Power Plant’s generation mix is estimated to produce approximately 0.73 tons of CO2/MWh in the Winter, 0.75 tons in the Summer and 0.74 tons in the Spring and Fall. Total tons for 2000 from this one project is 2.96 tons of CO2. Unfortunately the start date was delayed by two weeks, 10 % of the new CFL’s burned out in 9 months and were left in place or replaced with the original bulb and lamps were used in the morning versus early evening. Good enough for size of emission reduction? Now extrapolate to 5,000?

6. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Example CO2 reduction from substitution of renewable or nuclear electric energy production for CO2 polluting plants • Install 400 10 kW PV systems on houses or a 1,200 MW Nuclear Power Plant on a salt water inlet or a 100 MW wind farm on 200 acres on mountain ridge. • Similar to light bulb retrofits, these measures displace CO2. If MWh generation outputs are metered, error in quantifying the mitigated (avoided) CO2 from the power pool for each of the 8760 hours in the year are limited to the accuracy of the meters and the correlation between an estimated CO2 and each hours MW value. Latter needs IT system if data proprietary. • Two central supply options - TOD MW production may be documented and while proprietary, available to be applied by accessing the ISO/RTO data base. • PV installations likely not metered and may require 1. revenue quality kWh metering or 2. estimate of kWh production based on nameplate rating, tilt, orientation, and on the weather station's record of daily hours of sunshine.

7. A Performance Based Estimation and Measurement Standard to Quantify CO2 Example CO2 Reduction from Plants that do emit CO2 A Biomass plant is added to the Power Pool and a vintage PSNNH Coal Burning Power plant is retrofit with BACT. While the MWh of should be readily available from the ISO-NE Power Pool, there is a need to quantify CO2 reduction due to BACT retrofit and attributed to the substitution of the economic Biomass plant to the power Pool mix. In New England an APX (Generation Information System) addresses confidential data issues whereas in California it may in part addressed by the Demand Reserves Partnership Program. In addition to the correlation and meter errors associated with MWh production values, CO2 emissions may be fluctuating faster than the metering can sample as the quality and the variations in moisture in coal and wood chips vary, thus the accuracy and sampling rate of the CO2 monitor becomes more important.

8. A Performance Based Estimation and Measurement Standard to Quantify CO2 Highlights of DSM and Power Production metering examples Targeted and short-term metering can be cost-effective in certain DSM M&V. Persistence assessment may require long-term metering. Facility Energy Management System (EMS) may be used to verify savings of complicated technologies, HVAC Controls, Geothermal Heat Pumps, Fuel Cells Given the scale of the CO2 challenge, metering buildings at their service entrance voltage while not perfect is more appropriate than engaging circuit sub-metering. While 10 % of the implementation cost for energy (CO2 mitigation by product) saving measures can be tagged onto the M&V role without undermining a facility manager’s ROI, renewable energy projects begin at a deficit and M&V for emission of CO2 and other mitigated GHGases add additional cost burdens.

9. A Performance Based Estimation and Measurement Standard to Quantify CO2 Recommended Structure for Standard Project 1595 Employ a Performance Based Specification where 1. Coordination of CO2 data with MWh data through the regional Power Pool w/wo RPS or a ETS is made; 2. a prescriptive table is used to set the minimum accuracy to be achieved for quantifying a project’s total CO2 emission credit expected to be quantified. The project auditor or facilitator would apply whatever combination of meters in any configuration s/he determines to be necessary to achieve the minimum accuracy of the projects overall CO2 credit M&V.

10. A Performance Based Estimation and Measurement Standard to Quantify CO2 Strategy to developing the prescriptive Table for setting accuracy of Project oriented CO2 mitigation credit Employ Monte Carlo simulation to ascertain cost effectiveness of various measurement strategies. e.g. @Risk an MS Excel add-on. Using probability distributions assigned to a. estimation techniques (simulation, regression or spread sheet model) and b. kWh meters (manufacturer survey and dialogue) we will iterate through various combinations of measurement accuracy and cost to establish the Table. See projects categories in hypothetical Table (next slide).

11. A Performance Based Estimation and Measurement Standard to Quantify CO2 Prescriptive Table for specifying cost sensitive CO2 credit-accuracy: Hypothetical Table Project CategoryTonsCO2AccuracyCost Simple DSM (Indep HDD) x1 y1 z1 Complex DSM (CDD) x2 y2 z2 On-site renewable (Res PV) x3 y3 z3 IPP Renewable (Wind, Hydro) x4 y4 z4 IPP Renewable w emissions x5 y5 z5 (Biomass) Central Station BACT x6 y6 z6 Central Station Fuel Switching x7 y7 z7

12. A Performance Based Estimation and Measurement Standard to Quantify CO2 Estimation techniques to be analyzed for uncertainties: Facility: monthly bill analysis to estimate kWh reduction HVAC simulations to estimate kWh reduction Regression and other forecast techniques Spread sheet estimates of avoided kWh from ZE renewables Chemical engineering estimates of CO2 emission from fuel cells, biomass power plants, etc

13. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Metering manufacturers to be queried for performance - cost data on various meters organized by application: • ABB • Alstom • Eaton - Cutler Hammer • Electro Industries • GE • Invensys • Siemens • Others?

14. A Performance Based Estimation and Measurement Standard to Quantify CO2 Monte Carlo Analysis of “simple” DSM program accuracy: Uncertainty 1--- start & end (if < credit period) dates Uncertainty 2--- kWh demand during measurement period & kWh demand projected to end of credit period Uncertainty 3--- Conversion factor 1 - 3 to Xfer kWh demand to kWh supply Uncertainty 4---Measurement/estimate of Marginal CO2/MWh based on metering & estimations at Central Power Pool for critical periods of MWh avoidance CO2 credit Uncertainty --- result of Monte Carlo Simulation

15. A Performance Based Estimation and Measurement Standard to Quantify CO2 Monte Carlo Analysis of on-site renewableprogram accuracy: Uncertainty 1 --- start & end (if < credit period) dates Uncertainty 2--- kWh demand during measurement or estimation period, if latter need to account for variations in kWh diurnal, seasonal, size & site characteristics Uncertainty 3--- Conversion factors to Xfer kWh demand to kWh supply for seasonal and diurnal periods Uncertainty 4--- Measurement/estimate of Marginal CO2/MWh based on metering & estimations at Central Power Pool for MWh avoidance periods. Note if CHP then: 1. credit to avoid CO2; 2. debit by adding biomass plant CO2 emissions; 3. credit CO2 for absorption vs electric chilling. Steam?

16. A Performance Based Estimation and Measurement Standard to Quantify CO2 Monte Carlo Analysis of Central Plant BACT program accuracy: Uncertainty 1--- commission & de-commission (if < credit period) dates Uncertainty 2--- MWh supply production for 8760 hrs based on settlement meter at Central Power Pool Uncertainty 3--- Marginal CO2/MWh based on metering for as many periods as are affordable Uncertainty 4--- software estimation and rules used to combine the 8760 MWh data & the Marginal CO2/MWh data Overall BACT Uncertainty- result of Monte Carlo Simulation

17. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Motivation to Measure and Verify CO2 Credits • Direct: CO2 reductions through valued credits for new renewable generation (RPS), for compliance with ISO 14000 as an open door for bidding on GM solicitations or through Trading of CO2 credits (UK ETS). • Indirect: CO2 reductions due to slow or no growth during economic slow downs, through DSM or Arbitrage/ESCO programs, renewable project incentives and through replication of best practice (Spillover effect). • Good citizen/company/City promotions by government bodies, green associations and organizations looking for interesting and relevant topics that spark the interest of their membership

18. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Entities positioned to quantify CO2 emission credits • Power Industry by making work for unbiased DISCo employees that would be paid by society (US) and Govt/Private Investors (Int’l) to objectively quantify emission reductions associated with energy development and power production. Trickier Internationally where Distribution Companies are deregulated • Meter manufacturers, data base system integrators, meter consultants and others that will benefit by facilitating solutions. • Professional Organizations (IEEE), Associations and Trade Groups who add value to members through communication and action. Web communities can be used to facilitate interactive communities to rank and facilitate the 1595 standard • Non-profit international organization and financial institutions that have funding to dedicate to world problems

19. A Performance Based Estimation and Measurement Standard to Quantify CO2 • Conclusions: • Need to address many dispersed & unique CO2 mitigation programs • Performance based specification of accuracy vs program make-up • appears to be best approach • Need to balance accuracy versus cost burden • Need to identify and nurture facilitating entities • Need to assess Task Force resources, orientation and motivation to address goal of Standards Project 1595