Compressed Air Best Practices-August 2008

| 08/08 Focus Industry COMPRESSED AIR AUDITS | ENERGIZED FOR SAVINGS AT SEATTLE CITY LIGHT AND TACOMA POWER kW “Pay for Performance” Incentives Company: Manke Lumber Company Industry: Integrated Lumber Processor Location: Tacoma Tideflats Utility: Tacoma Power In keeping with the focus on ROI, the incentive programs offered by both utilities focus on “Pay for Performance” models. This begins with the Demand-Side Assessments (DSA’s), which can include compressed air leak audits. A DSA at Tacoma Power will be financed to 50% of the cost. “Paying 50% keeps the customer committed to implementing the project,” says Peter Meyer (Assistant Energy Services Manager, Tacoma Power). Average total cost for a DSA is $3,000. The DSA will identify and tag all the compressed air leaks. The facility must ensure that they are all fixed. Tacoma Power will loan the customer ultrasonic leak detection equipment (if necessary) to check the status of the leaks. Tacoma Power pays for 100% of their 50% share of the DSA cost — only if 100% of the major leaks are fixed. The “Pay for Performance” model is also applied to Energy Conservation Measures (ECM’s), which involve the replacement of equipment and systems. Both utilities will use an outside vendor to conduct a full audit. “The project must be delivering at least 85% of the projected savings after verification, or the customer is on the hook for 100% of the incentive funds promised the customer,” said Gary Johnson. This forces the vendor doing the auditing to be very accurate in forecasting energy savings. CO2 O Original Installation: Expansion of operations over thirty years and adding air compressors to keep up. Deficiencies included inefficient compressor controls, excessive piping distribution losses, inadequate air storage to meet peak demands and the inability to turn off compressors during non-peak times. The system ran continuously but had frequent downtime periods causing lost production. New Installation: New variable speed drive 350 hp air compressor and 300 hp fixed-speed air compressor were installed along with a new speed-control package on the existing 300 hp air compressor. A multiplex cycling dryer along with two 2,560-gallon air storage tanks was installed. Distribution piping was modified to prevent pressure drops. Energy Cost Savings After Project-Verified: 923,536 kWh ($38,244) Project Costs: $313,348 Incentive: $110,824 Simple Payback: 5.3 years Company: Puget Sound Coatings Industry: Surface Preparation and Coating Location: South Seattle Utility: Seattle City Light Original Installation: Originally had a 400 hp and a 250 hp air compressor working in modulation. They would fight each other — one would ramp up and the other would ramp down. Facility has large demand events from sand blasting and painting. New Installation: A 215 hp variable speed drive air compressor and two 125 hp fixed-speed air compressors. A fixed speed is more efficient at 100% loaded than VSD. The fixed speeds were used as base-load air compressors. Energy Usage Before Project: 1 million kWh Energy Usage Projected by Project: 425,000 kWh Energy Usage After Project-Verified: 350,000 kWh Incentive: $90,000 Simple Payback: 2 years A Bright Future for Projects When asked, “why do you pay customers to buy less from you?” both utilities quickly respond it is a better investment to pay for reduced consumption rather than to build new power plants. Tacoma Power is 90% hydro. They generate some of their own power and also buy some from the Bonneville Power Administration (BPA). The average cost of power from Tacoma is around 4½ cents per kW (including peak demand charges). The incentives provided by Tacoma Power are normally 12 cents per kWh. Tacoma Power’s current two-year budget for projects is $372,000. The utility already has plans for a major project in 2009. If things work out as projected, the project will receive $150,000 in incentives while delivering 2 million kWh in savings. Seattle City Light has a mature Conservation Program. Started in 1982, they “did a lot of controls projects in the 90s and we now focus on variable speed drive (VSD), cycling dryers, no air-loss drains and storage projects,” said Aaron Houseknecht, an 18 www.airbestpractices.com http://www.airbestpractices.com

Table of Contents Feed for the Digital Edition of Compressed Air Best Practices-August 2008

Compressed Air Best Practices- August 2008 Contents From the Editor Utility-Air News The August Audit of the Month: A Vacuum System Audit Energized for Savings at Seattle City Light and Tacoma Power Know Your System CASE: Compressed Air Supply Efficiency Ecos Air: Managing Incentive Programs Kaeser Compressors: Loyalty, Energy and Growth Building Relationships at Cummins-Wagner McIntire is Moving Forward The 2008 A.I.C.D. Conference & Exhibition Tuthill Vacuum and Blower Systems Resources for Energy Engineers: Training Calendar & Product Picks Wall Street Watch Advertiser Index Job Market

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