Maine’s Impending Energy Crisis

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We have been watching the natural gas storm on the horizon for some time, and this is the first major lightning strike.  We’ve theorized that LNG (liquefied natural gas) would be exported to Europe soon, raising prices for all gas consumers in the United States.  While that is still probable, there is a more immediate, domestic dilemma that Maine residents and small business owners will soon face.

It hasn’t been a secret that we have limited natural gas pipeline availability in New England, and the major pipelines coming to us from the south are not nearly large enough to meet the requirements for our demanding heating season.  For example, since July, Maine Natural Gas has been unable to connect new customers to the gas mains until an uncertain date in 2015 (we suspect it will be late in the year).  While at Thayer we strive to remain fuel-neutral, we question whether it is in everyone’s best interest to connect to natural gas, with many reasons listed in one of our previous articles (read more here).

The Maine Public Utilities Commission (MPUC), along with representatives from other state agencies, has issued a press release to the public, warning them to prepare for a surge in the price of electricity during the upcoming winter months.  Over half of the electricity in Maine is generated from natural gas.  Increased demand for gas and an inability to meet that demand has directly caused the price of electricity for Mainers to skyrocket.  While homeowners will not see price spikes until March of 2015, small-to-medium businesses should brace for impact since rates will more than double for standard rate customers by January; CMP customers, for example, will see price spikes from $.06 to $.15 cents per kilowatt hour, according to the press release.

Individual consumers and businesses alike make financial decisions based on electricity being available at predictable costs; not priced on crisis.  The fact of the matter is that the natural gas pipeline is constricted, and that is not going to change for several years at best.  After the method of funding new pipelines is determined, political wills of many must align.

Fortunately, there are several things you can do before the onslaught of this energy crisis; all relating to energy efficiency.  Both Michael Stoddard, Executive Director of Efficiency Maine, and Tom Welch, Commission Chairman of Maine Public Utilities Commission believe that now is the perfect opportunity to take a proactive stance and make energy efficient decisions.  At the beginning of October, the MPUC has approved the increased allocation of funding to Efficiency Maine.

There are a number of changes to existing programs, which when combined with the rising cost of energy actually makes for better incentives, equaling quicker payback.  We have effectively bundled several of the existing Efficiency Maine programs with new ones to yield larger incentives for our client/partners.  Call one of our project engineers today and have your building benchmarked using the Energy Star rating system, which will give you a starting point of things to consider.  There are almost always cost effective improvements that can be made to make you more money.

The Problem with Programmable Thermostats

Ecobee smart control thermostat

The Problem with Programmable Thermostats

Most commercial buildings use some form of time of day control for the heating and cooling systems.  Larger buildings are often equipped with centralized building management systems (BMS); however, the vast majority of buildings that are not large enough to justify these often costly systems must rely upon programmable thermostats.

Programmable Thermostats come with a very wide variety of features, ease-of-use and functionality.  Their price range varies, starting anywhere from $50 for a simple unit to $500 for “fully loaded” models.  Almost all of them are able to accept unique programs for each day of the week.  Some thermostats even allow for extraordinary events such as holidays.

The newest generation of programmable thermostats are called “smart thermostats” and include features such as electric meter communicability, remote access control via a computer or cell phone, and in some cases they may even learn and adapt to occupancy profiles.  Although growing in popularity, smart thermostats represent only a very small fraction of the installed base in commercial buildings.  Many of the more popular ones still have somewhat limited applicability to commercial HVAC systems.

So what’s the problem with programmable thermostats?  It’s basically this: rarely are they properly programmed or fully utilized.  Almost universally, their utilization isn’t optimized. There are a variety of reasons for this, so let’s explore a few.

If you have ever had teenagers living in your house, you know how maddening it can be to find lights illuminating an empty room, doors ajar, computers and televisions left on and even windows open while your heater or air conditioner is running.  This isn’t because they are bad people; it’s just that the month’s utility bill doesn’t come from their allowance.

The same problems usually exist in commercial buildings.  The occupants most directly affected by the HVAC systems don’t see them, and are very rarely the ones to pay the bills.  Those of us who are “comfort professionals” can attest that there are many varying opinions as to what the “right” temperature is.

We certainly all have seen this: an occupant sneaks by the thermostat, cranking the temperature up to where only inhabitants near the equator might find it comfortable.  A few minutes later, another staggers over, and before mass dehydration sets in, drops the temperature to where the windows begin to frost.

This causes building owners and managers to resort to imprison thermostats in silly looking cages, which often exacerbates the frustration that occupants feel over their comfort control. Some occupants become very creative, and find clever ways to trick and open these thermostat covers, or trick the thermostat’s thermometer.  So, at minimum, there is often a conflict between the interests of the occupants, and those who foot the bill.

Let’s examine another major—yet simple—reason why programmable thermostats don’t work well to save energy: the person with the vested interest in the energy costs isn’t the one programming the thermostats.  Well-intentioned owners, managers and maintenance staff usually will input a basic program at the time of installation, but rarely is there someone to regularly review these programs, which is necessary to tweak them to reflect the current schedule and usage of the building.  As the saying goes, “out of sight out of mind.”

Unfortunately, many programmable controls aren’t intuitive to use, let alone program. Documentation gets misplaced, and the previously trained operators forget, get transferred, or simply aren’t available.  Service providers typically don’t have access to the key person who can make decide on the necessary programming parameters of daily, weekly and annual schedules, let alone what the “appropriate” temperature levels are.

When I write my memoirs, there will be at least one large—and very amusing—chapter devoted to the many “thermostat wars;” creative approaches to tricking controls (i.e. car keys, lighters and bags of ice) and occasional outlandish requests for set points or systems performance, “Madam, we sympathize over your hot flashes, but please understand, your air conditioning systems isn’t designed to hold your office at 55 degrees; the industry considers that refrigeration.”

It’s extraordinarily uncomfortable for the service provider and or installer, such as us, to be asked to install a “dummy thermostat.”  Simply, these are thermostats that are placed for the occupants to fiddle with, yet don’t control anything except, often their perceptions.  Thankfully we very rarely get these requests.

Some of the newest smart thermostats are relatively inexpensive and accept basic time-of-day programming, yet will automatically reduce HVAC system operation when there is no activity observed.  We call these occupancy based smart thermostats. They allow the occupant to easily adjust the temperature and override a setback program (i.e. working late or on weekends) while still allowing the building manager to pre-program set point limits to reasonable levels.  They can be networked via innovative wireless networks, have remote accessibility, can be connected to the HVAC unit with wireless connections, track energy utilization and consumption, and even look attractive.

A lack of maintenance, faulty installation and poor designs are often the cause of discomfort within a building.  Thorough and comprehensive maintenance will identify and eliminate many of these maladies, but the newest generations of occupancy-based smart thermostats are useful tools in minimizing wasteful operation and delivering optimal occupant comfort. Most of them compile and display information about current and historical usage enabling owners and occupants to make more informed decisions about system usage. Allegedly it was this type of occupant activity and usage that attracted Google to recently buy Nest for a whopping $3.2 Billion.

Call one of our personal energy conservation and comfort specialists here at Thayer today for an evaluation of your building.  Additionally, send us your favorite picture of an antiquated, “user-modified,” interesting, worst location and/or downright wacky thermostat for a chance to win a free iPad Mini!

 

Dan

Dan Thayer, P. E

President, Thayer Corporation

 

 

 

“Cold War Two”

Russia’s Annexation of Crimea: All About Energy?

Checkpoint Charlie

It’s a strange time to be traveling in Europe, and no stranger was a visit to Berlin, which is becoming the new epicenter for what a local paper coined today, “Cold War Two.”  Germany has accused Russia of tearing Europe apart (read more here).  Yesterday I visited Friedrichstraße, or as it’s better known, “Checkpoint Charlie.” that, along with the Berlin Wall, symbolized the divisiveness and threat of tensions between Russia and the world. Following Putin’s fabricated “crisis,” the Russian invasion, and soon-to-be annexation of Crimea, the west once again finds itself asking itself collectivity, “how could this be?” If you look beyond the media hype and blame games, the reasons are quite evident and implications chilling.

The original Cold War rose along lines of political ideology. Today, it’s more about Russia’s most valuable currency: energy. Like the US, Europe has a thirst for cheap energy, the opiate of modern economies. Putin has skillfully leveraged Russia’s vast energy reserves to make much of eastern Europe dependent on Russian energy, mostly natural gas. For example, approximately 90 percent of Bulgaria’s gas comes from Russia, 70 percent in both Hungary and Poland, 35 percent in Germany and 25 percent in Romania. As we can now see, the strategy has been very steady and highly effective.

 

South Stream Pipeline

 

The mainstream press hasn’t covered much about what may be the biggest reason for the Russian annexation of Crimea: the South Stream Pipeline Project. For approximately seven years, Putin has been negotiating a path from southern Russia south-easterly to eastern Europe extending Russia’s influence, control and income from gas. A main spur of this pipeline was blocked by the Ukraine from passing over their Exclusive Economic Zone in the Black Sea without a large scale environmental impact study and Ukrainian permits possibly allowing the competitive White Stream Pipeline Project from neighboring Georgia to beat them to the prize. Although the South Stream pipeline could be re-routed around the Ukrainian continental shelf, it would be far more expensive and take longer to complete. This is just my left-field theory, but control of Crimea and the Ukrainian Navy could now allow Putin a prize that’s far more valuable than Crimea: access to more wealth and influence. That’s how “petrodictators” gain and maintain control.

EU leaders are meeting now discussing ways to reduce their energy dependence on Putin. The most favored strategy is to accelerate importation of relatively cheap American shale gas. Today, Germany is paying approximately 300% more for gas than US consumers pay. The US gas industry is ready to leap on this opportunity for significant and profitable gas trade to Europe, but investment and infrastructure are being held up by Washington lawmakers. This trade would benefit not only producers but also the many pipeline owners, shippers and refiners. Natural gas would need to be pressurized and converted to LNG for shipping. This is a an energy intensive process.

There are those in Washington that feel that cheap American gas should be reserved for the US market while opposing views favor profitable, sustainable US foreign trade. This is also likely one of the best strategies for diminishing Russia’s influence and overt power plays that is destabilizing all of Europe. This, along with significant banking sanctions could break the choke-hold Putin has on the region. Without a steady flow of income from energy, petrodictators seldom retain power. Just ask Gaddafi, Chavez and Ahmadinejad.

So what does this all mean to Thayer Corp and our customers? Expect gas prices to rise steadily and relatively quickly. Natural gas is still a great choice for buildings, but shouldn’t be favored over you best investment; comprehensive preventive maintenance: the “lowest hanging fruit” of your conservation program.

Dan

Dan Thayer, P. E.

President, Thayer Corporation