Author: Ahmad Fraij

We discussed in our previous article the need to electrify the gas equipment and appliances in the building to achieve net-zero carbon emissions but we noted that the electrical appliances such as the heat pump units for providing space heating are weather dependent and its capacity and efficiency degrade with lower ambient temperatures and it would be better to keep the gas boilers for space heating.

The other option is to run the gas equipment with a clean fuel that does not produce carbon emissions when it burns such as Hydrogen. Combustion of Hydrogen as fuel produces water vapour to the atmosphere and does not produce carbon emissions, which makes it perfect replacement to the natural gas to achieve net-zero carbon emissions.

Countries around the world started trials to use Hydrogen as fuel by mixing it with natural gas in the natural gas network that supplies gas to the houses and businesses. Here in Australia there is Hydrogen Park South Australia (HyP SA) as the first project to mix 5% of Hydrogen with natural gas and supply it to the houses in that district. Also in the beginning of 2022, a 10% of Hydrogen will be mixed with natural gas and supplied to 750 properties in Gladstone (Hydrogen Park Gladston) in Queensland. Most of the modern gas appliances such as boilers are ready to use natural gas with 20% blend of Hydrogen and some manufacturers claim their boilers can use up to 30% Hydrogen blend.

As we can see the use of Hydrogen as fuel started but to reach net-zero carbon emissions, we need to use 100% Hydrogen fuel with 0% natural gas in the gas network, but is this achievable? Is it coming in the near future? Using 100% Hydrogen in our gas networks requires the Hydrogen to be produced at a large scale and in a cost effective way and it requires huge infrastructure to be build. Also, we need the Hydrogen equipment such as boilers to be produced at a large scale to be competitive and adopted in the buildings.

Australian Gas Network who is one of the biggest operator of natural gas networks in Australia targeting 10% renewable gas blending across their networks by 2030 and 100% renewable gas supply by no later than 2050 – and 2040 as a stretch target. Therefore, it is a long way to go until we use 100% Hydrogen in our gas networks. Note that the Hydrogen must be produced using a renewable energy and not using fossil fuels to be 100% Renewable fuel.

Based on the above discussion, we can see that for achieving net-zero carbon emissions in the near future (i.e. short term target), the best option for the building owner is to electrify the equipment and/or buying carbon credits. For a long term target, the building owner might have the option to use Hydrogen Fuel for their gas equipment to achieve net-zero carbon emissions.

We discussed in our previous article how to prepare successful net-zero carbon emissions strategy for an organization and we mentioned that to achieve this target, you need to buy green power or offset your unavoidable carbon emissions. In this article we will discuss what will be the cost of electrifying the equipment in the facility if you buy green power and in particular electrifying the space heating equipment.

The space heating for commercial buildings is usually provided by either gas boiler or by electric heat pump chiller. The boiler is ambient independent in which it provides constant heating to the building regardless of the ambient temperature. On contrary, the heat pump chiller is ambient dependant and its heating capacity degrade with lower ambient temperature. Therefore, many experts recommend to keep a boiler as a backup for the heat pump chiller or oversize the heat pump chiller to cope with the lower ambient temperature that might occur during the winter season. However, for the purpose of reducing the carbon emissions and achieve your target of net-zero carbon emissions, the heat pump chiller is the best option that can replace the gas boiler if you buy green power.

Therefore, what will be the cost implication by replacing a gas boiler with a heat pump chiller. To give the building owners indication about this cost implication, we have done quick calculations to estimate this cost implication for a mid-size building that runs 24 hours a day, 7 days a week such as hotel, hospital or aged care facility. We have done our calculations for three major cities in Australia (Melbourne, Sydney and Canberra) and we assumed that this building is located in the CBD of each of these cities. We have obtained the energy prices for the CBD’s of these three cities from the website of one of the energy retailers and they are summarized in the table below:

The green power on average is more expensive than the normal power by around 5 cents and therefore, we have added 5 cents to the above electricity prices for Melbourne and Sydney but we haven’t added anything for Canberra electricity price because Canberra Government has already supply the whole city with green power.

We have used in our calculations the Heating Degree Days (HDD) method to estimate the energy consumption. The HDD for the above three cities have been obtained from AIRAH (Australian Institute of Refrigeration, Airconditioning and Heating) Handbook. We have obtained the budgetary price for the heating equipment from the equipment suppliers.

The table below summarizes our calculations results for this study:

Based on the above table, we can discuss the following points:

  • Melbourne and Canberra have more EFLH compared to Sydney because they have colder weather.
  • The boiler has the same efficiency for all the cities but the heat pump chiller efficiency (COP) depends on the design winter temperature and therefore, the Sydney chiller will be the most efficient (i.e. highest COP).
  • The energy consumption is related to the design winter temperature in which Canberra has the most energy consumption and the most carbon emissions from the gas.
  • The annual energy cost for the heat pump chiller for both Melbourne and Canberra is higher than the boiler annual energy cost, while the chiller energy cost for Sydney is lower than the boiler energy cost. This is mainly because Sydney has better chiller COP because of the warner weather during winter compared to Melbourne and Canberra. Another reason is that Sydney gas price is higher compared to Melbourne gas price. Therefore, for Sydney, it is a win-win situation in which the building owner can achieve net-zero carbon emissions by electrifying the equipment and in the same time reduce their energy consumption cost.
  • The price of the heat pump chiller is way more than the boiler price and therefore, the building owner should allow higher capital cost for replacing a boiler with heat pump chiller than replacing a boiler with another new boiler. Also, the maintenance cost of the heat pump chiller is relatively higher than the boiler maintenance cost due to more moving parts. You can also note that because of the low ambient in Canberra, the chiller price is higher because it requires bigger chiller to meet the same capacity.
  • If the capital cost of the heat pump chiller is high and the building owner don’t have a budget for it, then they can offset the boiler carbon emissions by buying carbon credits. Assuming the cost of the tonne CO2-emissions is $20, then the building owner in Melbourne for example, will pay annually 227 x $20 = $4,540 for offsetting this 227 tonnes CO2-emmissions. Note that this CO2 offsetting cost is an annual cost in addition to the gas cost consumed by the boiler. Therefore, a feasibility study should be done to decide on which option is more economic (i.e. replacing the boiler with heat pump chiller or offsetting the boiler carbon emissions).
  • Finally, we have used constant heating capacity of 500 kW for all the cities to provide apple to apple comparison but note that the size of the building will be different from city to city for the same heating capacity due to the difference in the design winter temperature.

If you need help to decide on which option is more economic and beneficial to you in your journey for net-zero carbon emissions, then please don’t hesitate to contact us.

To meet the 2015 Paris agreement target for keeping global temperature rise below 1.5⁰C, reducing the CO2 emissions is not sufficient and we have to try achieving net zero carbon emissions to preserve the environment. Net zero carbon emissions means that either we don’t produce CO2 Emissions at all or we offset what we produce by implementing projects that absorb these emissions such as renewable energy, tree planting, bio-energy…etc.

Most of the Australian state governments have committed to net zero emissions by around 2050 and therefore, the private sector should follow suit for the many benefits that will return on the organization by committing to net zero carbon emissions. Some of these benefits are listed below:

  • Preserve the environment for the coming generations.
  • Committing to a net zero carbon emissions will show the responsibility of the organization to the environment and this will attract more clients.
  • Attracting more investors and tenants.
  • Differentiate your business from other competitors in your market.
  • You will be better prepared for future changes in energy prices and new regulations.
  • You can get NABERS Carbone Neutral Certificate, which is nationally recognized, and improve your organization ranking in your market.

To achieve net zero carbon emissions, you need to prepare a successful plan with reasonable targets to achieve. The briefed six steps below, can help you prepare such a plan:

  1. Determine the Organization Carbon Footprint:

The first step is to calculate how much is your total carbon emissions. This is including the emissions from all the organization activities such as: energy, operations, vehicle fleet, waste, refrigerants…etc.

This can be done by the organization sustainability team if they are qualified to do so or you can ask help from a specialized consultant.

  1. Reduce the Organization Waste:

All the waste whether it is energy waste or others should be reduced to the minimum. Energy and waste audits should be conducted to determine the places of the waste and eliminate it. Energy audit for example, can determine the energy waste and the ways to eliminate it. It also, estimate the carbon emissions avoidance by eliminating the waste. Click here for more details about the energy audit.

Usually, cutting the waste requires low capital cost because most of the time it is achieved by behavioural change to the organization staff, controls fine tuning, installing timers…etc and therefore, can be achieved in the first to second year of the net zero carbon emissions plan.

We always recommend to hire a specialist consultant to conduct these audits, who have vast experience in this field.

  1. Increase the Efficiency of the Existing Systems and Equipment:

The next step is to replace the inefficient systems and equipment with high efficiency type such as: replacing old chiller or boiler with new high efficiency type, replacing the old lights with new LED type…etc and this is can be done after conducting energy audit to the organization buildings. Further, replacing petrol vehicles with electric vehicles can be done under this step.

Improving the efficiency of the existing systems and equipment requires high capital cost and therefore, it take some time to be achieved and it depends on the organization available budget for these changes. However, there are many government grants and financial sources that can help in this step and make the changes more affordable to the organization.

  1. Install Renewable Energy Systems:

After we cut the waste and improve the efficiency of the existing system and equipment, we need to install renewable energy sources such as solar PV system to reduce the carbon emissions of the organization.

Renewable energy systems require high capital cost and the organization has many grants and financial options as we mentioned above to help them install such systems.

  1. Environment Conscious Procurement:

The procurement department staff of the organization should be environment conscious and they should be involved in this plan so they can procure high efficiency systems and equipment for the organization that reduce the carbon emissions.

  1. Offsetting the Remaining Carbon Emissions:

Now after we have cut the waste, improved the efficiency of the existing systems, installed renewable energy system and make sure our new procured systems are efficient, we need to offset the remaining carbon emissions to achieve net zero emissions. This can be done either by buying carbon credits or by sourcing green power or by both.

If you need help with your net zero carbon emissions plan, please don’t hesitate to contact us.

In any facility, there are effective and ineffective energy conservation measures that can be implemented to save energy and reduce the facility energy bills. Factors that are used to determine the effective/ineffective measures are summarized below:

  • The return on investment or payback period.
  • The non-direct savings such as maintenance savings, materials savings, increased productivity, better safety…etc.
  • The time required to implement the measure.
  • The disruption to the facility operation due to the measure implementation.
  • The amount of CO2 emissions avoidance by implementing the measure.
  • Any risk associated with implementing the measure.

To select the effective measures to be implemented in the facility, an energy audit should be conducted and a holistic analysis to all the possible measures should be carried out taking into consideration all the factors mentioned above to decide on which measures are more effective than others. Click here for more details about energy audit.

For example, it is ineffective to replace an old water chiller with low maintenance requirements, while a fine tuning to the Building Management System (BMS) can save more energy and with much less capital cost. It is good to implement both measures but most of the time the facility owners don’t have enough budget to implement multiple measures.

Likewise, it is ineffective to replace an old water heater in an office building that has low hot water consumption rather than replacing the old lights, which are on all the day, with LED type.

Therefore, it is not a matter of just implementing any energy conservation measure to save energy and we say we are achieving the organization sustainable targets; it is a matter of analysing these measures in a smart way to decide on which measures have better return on investment and better benefits to the facility owner than the other measures to avoid wasting the money and time.

Most of the times, the facility owner and the facility staff are lacking the knowledge and the experience to conduct energy audit and holistically analyse all the possible energy conservation measures and therefore, they should hire an experienced energy consultant to carry out this analysis and advise them.

The energy analysis and the return on investment calculations that the energy consultant carries out determine which measure is more effective than the other and why we should give it priority to implement it first.

If you need a help to determine what effective energy conservation measures options you have for your facility, please don’t hesitate to contact us.

Usually the facility management contract talks about how to manage the systems and equipment in the facility and how to keep them running smoothly. However, in many cases it overlooks the energy management and energy efficiency best practices. The facility owner for their benefit and for the environment benefit should include clauses in the contract talking about the required services from the facility management company for energy management and energy efficiency.

The facility management company should have knowledge and experience in energy management so they can save their clients money from the running cost of the systems and equipment in the facility and also they should be committed to preserve the environment for the coming generation. The climate change is real and energy efficiency/sustainability became essential for most of the facility owners and who denies that will be left behind.

So, what we need to include in the facility management contract for energy efficiency? We have summarized below main points that need to be included and the facility owner can modify/add to this list based on the type of the facility and its systems and equipment:

  • Energy Audits: The contract shall have clause taking about periodic energy audits to the facility. Energy audit analyses the facility energy consumption and identify any anomalies or any energy saving opportunities. It also inspects the systems and evaluates their efficiencies and determines when an equipment needs to be replaced with higher efficiency type if that has a good return on investment. These energy audits can be conducted by the facility management company staff if they are qualified to do so or they can hire an energy consultant to do it for them. Click here for more details about the energy audit.
  • NABERS Energy & Water Rating: NABERS rates the building in a scale from one to six stars based on its energy consumption and compared to other similar buildings. NABERS rating tells the facility owner as well as the facility management company how far is the building from the best performing buildings and whether there are opportunities to save energy and improve the building efficiency. The rating can be done by accredited assessors from the facility management company or they can hire NABERS accredited assessor to do it for them. Click here for more details about NABERS Rating.
  • Schedules for Recommissioning and Maintenance: The contract should talk about scheduling recommissioning and maintenance to the facility systems and equipment to make sure they are tuned for the best efficiency.
  • Energy Efficiency Action Plan: The contract should talk about preparing energy efficiency action plan to set realistic targets to implement energy conservation measures in accordance with the budget available from the facility owner.

Off course the above additional services will increase the facility management contract value but it will save the facility owner a lot of money in the running cost and in the same time, preserve the environment for the coming generations. Further, implementing energy conservation measures in the facility and NABERS energy rating for the facility increases the asset value and attracts more tenants to the facility so, it is an investment and not a waste of money.

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