DETERMINATION OF ENERGY

SAVINGS
Prepared by
Duan Gvozdenac and Miroslav Kljaji
Project: Regional training on planning and monitoring
energy efficiency measures in the constructing sector
Podgorica, Tiran, Sarajevo i Banja Luka, October December, 2013.
Determination of Energy Savings

Energy is paid in money but it is measured in energy units
(kWh, kJ). There is direct dependence between the price paid
for energy and its consumption and it is stated in the unit price
of energy. This price is mostly determined by external factors
and the owner of a factory, a house or an apartment cannot
affect it. He/she can choose the type of energy carrier which
will be used for his/her needs and thus affect overall energy
costs. The efficient use of purchased energy is under his/her
full control and he/she can do a lot in that respect. How?
You cant manage what you dont measure
Determination of Energy Savings

Measuring parameters of energy flows provides conditions
for their control.

If criteria of this control are established (for example,
minimum energy consumption or minimum pollution of the
environment or maximum security of energy supply or
achieving maximum preset comfort in an air conditioned
room, etc.), it is possible, then, to achieve optimum control
of the system with preset conditions.
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Heat Energy
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Example of Energy Consumption during a Year
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Load Duration Curve Electricity
Heating and Heat
Energy for Absorption
Chiller
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Load Duration Curve Heat Energy
Energy efficiency projects are in their core offering the
increase of the degree of effectiveness of some energy
transformation.

This is achieved by changing procedures of managing the
energy plant, by replacing the part or the whole technology,
etc.

No matter what is in question and what kind of change is
made, it is necessary to provide continuous monitoring of
energy flows in the energy plant.
Monitoring Energy Flows
Measurement and verification (M&V) is a procedure of
performing continuous measurements of energy parameters
for the purpose of assessing achieved effects by applying
measures for the increase of energy efficiency of the entire
energy plant or the part thereof.

Measures to increase energy efficiency are applied in order to
achieve the reduction of energy and/or water consumption in
industry and buildings and to achieve positive financial effects
of business operations and to reduce environmental pollution.
Monitoring Energy Flows
The achieved effects are determined by comparing measured
values of energy consumption before and after the application
of one or more measures to increase energy efficiency. The
activities under the M&V procedures are:

Installation, calibration and maintenance of measuring
devices,
Collection, processing and analysis of data,
Development of a calculation method and establishment of
reliable assessments,
Calculations with measured data, and
Reporting to all relevant stakeholders and verification of
reports by a third party, if there is a need for that.
Monitoring Energy Flows
Measurements that are carried out within the M&V should be
differed from the measurements related to the process
management or measurements that are occasionally done
during preliminary and detail energy audits. The main purpose
of the M&V is as follows:

To reduce energy consumption. It is well known that it is
not possible to manage something that is not measured.
Measurement of energy consumption provides building
managers not only with valid information about the
appropriateness of energy systems but also about the
effects of possibly undertaken measures to increase energy
efficiency.
Monitoring Energy Flows
To stimulate financing of projects for energy efficiency
increase. A good M&V PLAN increases transparency and
credibility of reports on achieved effects. The existence of
the M&V Plan can also raise thrust of investors and potential
donors in energy efficiency projects.
To improve design solution, plant and maintenance.
Good M&V helps managers to disclose and lessen problems
related to maintenance and plant running and provides
feedback information for planning future investments.
To manage energy balance. Even in cases when energy
consumption is not planned, the M&V techniques enable
managers to manage energy use in a much better way. The
M&V techniques provide opportunities to notice and explain
possible deviations from the balance and to introduce
corrections resulting from changed operating conditions.
Monitoring Energy Flows
To increase the value of the project by collecting credits
for reduced emissions. The calculation of reduced GHG
emissions adds value to the project if the project is
implemented under the mechanisms of the Kyoto Protocol.
The use of the M&V Plan for determining energy effects also
contributes in the growth of credibility of reports on reduced
emissions.
To improve understanding of energy management as an
instrument of national energy policy. The M&V techniques
are a powerful tool for the promotion of social awareness on
energy efficiency and reduction of GHG emissions. Good M&V
practice emphasizes social benefits offered by proper energy
management such as the improvement of public health and the
protection of the environment.
Monitoring Energy Flows
M&V Plan and Report on Achieved Effects

The process of developing the M&V Plan should be carried out
simultaneously with the preparation of the project for the
implementation of a measure or measures to increase energy
efficiency. The measurement processes and verifications should
include the following steps:

Analysis of needs of users of planned reports. If the priority
to the user is to control total costs, the best method is the one
that involves the entire building. If the result of a specific
measure to increase energy efficiency is important to the user,
it is necessary to select measurements that enable
determination of some specific energy indicators. Such cases
arise when it is necessary to check some technology in order
to repeat similar projects in the factory.
Determination of necessary and sufficient accuracy of
measurements. When it is determined what to measure, what
follows is the choice of measuring equipment and frequency of
reading. At this stage, wrong assessments happen very often
since a large number of overly precise equipment is selected
instead of necessary and sufficient. This increases costs
needlessly.
Baseline consumption. The basic concept of the M&V
procedure is in the comparison of some baseline energy
consumption with the current one. At that, it is implied that
operating conditions of the entire plant or the part thereof, in
which some of the measures to increase energy efficiency are
applied, remain unchanged. The expected reduction of energy
consumption is:
Reduction of Consumption=(Energy Consumption in Baseline Period)
-(Energy Consumption in the Period after EEM Implementation) CORRECTION
M&V
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Reporting Period Basic Period
Increased
Production
EEM
Implementaion
Saving or
Avoided
Energy Use
Calculated Consumption
Corresponding to Conditions
without EEM Implementation
Example of Energy Consumption Diagram
Preparation of the plan for reading measured
values

Modern technology provides opportunities for automatic
reading of measured values. However, this does not mean that
it is also compulsory. Therefore, it is necessary to select an
optimum plan for reading which can also be manual. The goal
is to obtain reliable measurement values.
Data processing and reporting
The whole M&V procedure is carried out to obtain reliable data
about achieved savings in energy and water consumption. Data
processing is done according to previously verified procedure
and it can be manual or automatic. The report on achieved
results should be forwarded to several addresses and therefore,
it should be prepared with that in mind.
For example, if it is sent to the top management, it should be,
then, very simple and contain only data related to the final
financial effect of the measure for energy efficiency increase. If
the repot is intended for technical management of the facility in
which the plant is located, the report should contain technical
indicators enabling evaluation of not only achieved savings but
also of the quality of operations of the whole plant and
monitoring of parameters affecting functionality
Verification Plan
When planned savings in energy consumption are determined
and possibly proved, it is necessary to establish the procedure in a
systematic way for constant verification of measurement data and
calculations and to plan necessary actions when it comes to
deviations. By all mean, it is necessary to envisage some sort of
tolerance within which measured values are still satisfactory and
it is considered that the effects of implemented EEM are
acceptable.
However, if deviations are not within planned limits, the reason
for that should be immediately sought and measures undertaken
to return observed parameter within acceptable limits. The
following Figure shows an example of measurement results and
their verification.
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Time
Allowed
Deviation
Planned Energy
Consumption after EEM
Implementation
Unexpected
Consumption
Trend. Immediate
Action to Remove
Defect
Expected
Saving
Baseline Energy
Consumption
Baseline Period Period after EEM Implementation
Examples of Monitoring and Verification
Analysis of financial effects in the lifecycle of
applied EEM
The M&V is a permanent process which is conducted in the
whole period of the project lifecycle. In addition to physical
decrease of energy consumption, it is important to determine
financial flows.
Namely, energy prices are changing during time unfortunately
almost always up and not always in the proportion. Thus, it is
possible that the effect of physical reduction of energy
consumption does not need to correspond always to adequate
effect financially.
Example of M&V Procedures
of Some Parts of Energy Systems

Boilers M&V. The aim of measurements is the
comparison of actual performance with an expected one
(targeted).
Continuous analysis is based on measured values and
operating corrections directed towards the best operating
practice.
All relevant parameters to be measured in order to
determine indicators of boiler operations.
Successful monitoring requires the definition of
necessary measurement points and frequency of their
recording.
The following Figure shows the basic measurement points
and the values to be measured in the case of a steam boiler.
The boxes in gray background represent values that are not
necessary to be measured.
For example, the temperature of steam (M
2
) should be
measured only in case of superheated steam. Or, if the steam
flow is measured with sufficient accuracy, it is not necessary
to measure the flow of feed water although this value is
often measured.
Boilers M&V.
Boundary of System
M2
mS [t/h] =
pS [bar] =
tS [
o
C] =
Steam
M1
tFW [
o
C] =
mFW [m
3
/h] =
ConFW [S/cm] =
Feed Water
M3
M4
mG [kg/h] =
GCV [MJ/kg] =
Fuel
tA [
o
C] =
Air
tPS [
o
C] =
CO [ppm] =
O2 (vol) [%] =
Flue Gasses
M5
CondBW [S/cm] =
Boiler Water
M7
M6
mBD [t/h] =
Blowdown
M8
tsurface [
o
C] =
Radiation Losses
Typical Measuring Points for Boilers
MONITORING
PARAMETER
PURPOSE
Frequency and Scope
< 20 t/h of steam
20 100 t/h of
steam
Liquid Fuels
Calorific value Calculation of heat input.
No checking. Values
given by the supplier
can be used.
Density and sulfur
portion for each
delivery.
Fuel composition
(Fuel distribution
companys certificate )
Possible negative effects
on heat transfer surfaces
and emissions of
combustion products.
No checking. Values
given by the supplier
can be used.
Annual control.
Consumption Calculation of heat input.
Daily measurement
and control.
Continuous
measurement and
control
Viscosity Regulation of burner. From time to time.
For each fuel
delivery.
Combustion
product
temperature
Calculation of energy
efficiency of heat losses
with combustion
products.
Continuous
measurement and
control.
Continuous
measurement and
control. Automatic
regulation
MONITORING
PARAMETER
PURPOSE
Frequency and Scope
< 20 t/h of steam 20 100 t/h of st.
Gaseous Fuels
Calorific value Calculation of heat input.
No checking. Values
given by the supplier
can be used.
Density and sulfur
portion for each
delivery.
Fuel contents
Possible negative effects
on heat transfer surfaces
and emissions of
combustion products.
No checking. Values
given by the supplier
can be used.
Annual control.
Consumption Calculation of heat input.
Daily measurement
and control.
Continuous
measurement and
control.
Combustion
product
temperature
Calculation of energy
efficiency of energy with
combustion products.
Continuous
measurement and
control.
Continuous
measurement and
control. Automatic
regulation
Combustion
products analysis
Calculation of efficiency
(by using portion of O
2
;
and due to incomplete
combustion by using
portion of CO).
Daily analysis.
Automatic regulation
is desirable
Continuous
measurement and
control. Automatic
regulation
MONITORING
PARAMETER
PURPOSE
Frequency and Scope
< 20 t/h of steam
20 100 t/h of
steam
COAL
Calorific value Calculation of heat input.
No checking. Only
figures given by the
supplier can be used.
Mont. measurement
of moisture and ash.
Monthly
measurement of
calorific value.
Fuel contents
(Fuel distribution
companys certificate )
Possible negative effects
on heat transfer surfaces
and emissions of
combustion products.
No checking. Values
given by the supplier
can be used.
It is necessary to
check the
composition and
assortment
Consumption Calculation of heat input. Daily measurements.
Continuous
measurement and
control.
Combustion
product
temperature
Calculation of efficiency.
Continuous
measurement and
control.
Continuous
measurement and
control.
Combustion
products analysis
Calculation of efficiency.
Daily analysis of O
2

and CO.
Continuous
measurement and
control.
Analysis of slag Calculation of efficiency.
Daily visual
inspection.
Analysis per shifts.
MONITORING
PARAMETER
PURPOSE
Frequency and Scope
< 20 t/h of steam
20 100 t/h of
steam
WATER
Supply water
analysis
Blowdown
Measurements per
shifts.
Continuous
measurement and
control.
Supply water
temperature
Calculation of energy
efficiency.
Continuous
measurement and
control.
Continuous
measurement and
control.
Supply water flow
Calculation of steam
production if flow is not
measured.
Continuous
measurement and
control.
Continuous
measurement and
control.
Fresh water
analysis
Blowdown Daily measurements.
Continuous
measurement and
control.
Boiler water
analysis
Blowdown.
Measurements per
shifts.
Continuous
measurement and
control.
Temperature of
return condensate
Calculation of supply
water temperature.
Measurements per
shifts.
Continuous
measurement and
control.
MONITORING
PARAMETER
PURPOSE
Frequency and Scope
< 20 t/h of steam
20 100 t/h of
steam
STEAM
Steam flow
Calculation of efficiency
and heat energy.
Continuous
measurement and
recording or supply
water flow
measurement.
Continuous
measurement
and control.
Steam pressure
Calculation of thermal
effect.
Continuous
measurement and
control.
Continuous
measurement
and control.
Options of M&V Procedures
M&V Option
Manner of Calculating
Effects
Typical Application
A.
Measurement of key
parameters
Savings are determined by
measuring key parameters
which define energy
consumption of the system in
which the measure for energy
efficiency increase has been
applied.
The frequency of
measurements is adapted to
expected variations of
measured parameters.
Less important parameters
are estimated on the basis
specifications provided by
equipment manufactures or
on the basis of experience.
On the basis of
engineering calculations
of energy consumption of
the baseline period and
after EEM application.
It is compulsory to
determine CORRECTION
on the basis of operating
conditions of the
equipment or plant in
both periods.
Lighting in which
capacity is the key
parameter. The other key
factor is the number of
operating hours of
individual parts of the
lighting system.
M&V Option
Manner of Calculating
Effects
Typical Application
B.
Measurement of all
parameters
Savings are determined by
measuring energy
consumption of system
affected by the EEM
implementation.
Frequency of
measurements is in the
range from short term to
continuous depending on
expected variations of
measured parameters and
on the duration of the
reporting period.
Short term or continuous
energy measurements in
baseline and reporting
periods and/or engineering
calculations by means of
indirect measurement of
energy consumption.
Routine and non-routine
adjustments are done
according to the needs.
When using frequency
regulators for the purpose
of pump flow control. Watt
meters measure electricity
every minute.
Options of M&V Procedures
M&V Option
Manner of Calculating
Effects
Typical Application
C.
Supervision pf the whole
facility
Savings are determined
by measuring energy
consumption of the whole
facility or part thereof.
Continuous measurement
of energy consumption in
the whole facility is used
during the whole reporting
period.
Annalisa of data by
metering devices in
baseline and EEM
application periods.
Routine and non-routine
corrections are made
according to the needs.
Implementation of the
energy management
program affecting systems
within the building (plant).
Monthly measurement of
energy consumption by
meters for electricity and
gas in the course of twelve
consecutive months and
over the whole service life
of the project.
Options of M&V Procedures
M&V Option
Manner of Calculating
Effects
Typical Application
D.
Simulation of consumption
measurement
In this case, savings are
determined by simulation
of energy consumption of
the whole facility or part
thereof.
This type of M&V is the
only one in new buildings
when there are no baseline
measured values.
Simulation routines are
used for adequate
modeling of actual energy
efficiency of systems in the
building (plant).
Simulation of energy
consumption with hourly
or monthly data from
bills (measurement of
final energy consumption
can be used for
redefining input data).
Multi purpose program for
managing energy
consumption in the building
has several systems and does
not have data for the baseline
period.
After the installation of a
measuring device,
measurements are used to
calibrate simulations.
Energy consumption in the
baseline period is determined
by means of calibrated
simulation and it is compared
with the simulation of energy
consumption in the period
after EEM has been
implemented.
Options of M&V Procedures
Example 1. Improvement of Boiler Efficiency

Starting points. The contractor has replaced the existing boiler
in a commercial building with a new more efficient one. In the
offer, annual savings of fuel oil of at least 35,000 is guaranteed
provided the boiler load is the same as in the baseline period
which included the whole heating season. The employer is
obliged to pay for annual savings to the contractor after the
contractor presents the report on savings. The M&V Plan for the
whole period is done together by the contractor and the
employer (Type B).
As it was already mentioned a company which provides energy
services by proposing EEMs through contracts with guaranteed
energy savings is called an Energy Service Company (ESCO).

The primary purpose of the M&V for contracts with guaranteed
effects often quickly shows the results of energy efficiency
projects. After such analysis and verification of effects, the
employer can undertake running the plant and does not need
permanent relations with the ESCO. The M&V Plan becomes the
part of the contract on guaranteed savings and defines
measurements for determining mutual payments.
Factors affecting M&V concept.

The hot water boiler is the only energy device that
uses fuel oil as a fuel. The price of fuel oil according to
which savings will be calculated is 1.10 /l. The
agreement between the contractor and the employer
seems to specify the contractors responsibility only
relevant to the improvement of boiler energy
efficiency and not for the load under which the boiler
is used.
M&V Plan. The control boundary of the system is the hot water
boiler itself. Measurements include measurement of fuel oil
consumption and net delivered heat to the building. Since the
boilers consumption of electricity in relation to the consumption of
chemical energy of the fuel is minimum, electricity consumption is
not included in the energy balance.

Such a plan is an option A in the Table 2.

The buildings owner ordered 241,300 liters of fuel oil for firing the
boiler in that heating season. At the end of the heating season there
were 2,100 liters left in the tanks out of the ordered quantity. The
consumption of fuel oil in the baseline year is 239,200 liters. The
boiler load is determined according to above data after determining
energy efficiency of the existing boiler. This quantity of fuel oil is
considered as accurate as it is determined by measuring the level in
the tanks and confirmed by bills of the fuel oil supplier.
Energy efficiency or the degree of the boilers effectiveness is
carried out during winter period before the removal of the old
boiler. Winter conditions are needed to ensure sufficient boiler
load and thereby obtain reliable figures for the boilers efficiency.
To measure the flow of fuel oil, a turbine flow meter is installed
with the accuracy class of 2%. For measuring delivered heat
energy, a calorimeter is installed of the same accuracy class.

Baseline data are obtained on the basis of independent
measurements in the duration of three weeks at the time when
the average daily temperature was -5 to +5
o
C. The same kind of
measurements is also planned after the installation of a new
boiler by means of the same measuring devices. This also implies
that the outside temperature is within the same range as in the
case of measuring the efficiency of the old boiler.
Measurements for the old and later for the new boiler are carried
out by boiler operators on a daily basis during planned three
weeks. Readings of the meter and calorimeter are recorded in a
prepared form available for inspection at any time.
The outside temperature is measured automatically and it is
recorded in an independent device. The contractor and the
employer determined together the level of satisfaction of the
external conditions for the execution of tests.

Delivery, installation, putting into operation of the calorimeter
and flow meter for fuel oil, calculations and writing a report on
achieved savings during two months is agreed in a separate
contract worth 5,100. The contractor offered an additional
contract worth 3,000 for the supervision of measurements over
the entire heating season. This additional contract was not
accepted by the employer.
Result. Measurements carried out by the calorimeter and fuel oil
flow meter are collected during five weeks until valid
measurements for three weeks when average daily temperature
of outside air were within the desired range from -5 to +5
o
C.
This means that net delivered heat energy to the building and the
energy of consumed fuel oil give the figure 65.2 % and this is the
average efficiency degree of the old boiler.
After the installation and putting into operation of the new
boiler, identical measurements are carried out in the course of
three weeks at average outside temperatures from -5 to +5
o
C.
The average efficiency degree of the new boiler is 80.6 %.
In the boiler room and in the boiler systems there are no other
changes except the boiler itself and therefore, the correction of
results obtained by measurements is not necessary.
| |
= =
|
\ .
0.652
Reduction of Fuel Oil Consumption 239.200 1 45,700[l /year]
0.806
= = Fuel Oil Saving 1.10 45,700 50,270[/year]
Since the annual consumption of fuel oil is known (239,100 liters),
the expected annual saving is as follows:

The expected financial effect is:
The contractor guaranteed the saving of at least 35,000 and
obviously did not achieve that.
Example 2. Efficiency of a Lighting System

Starting point. In one school, efficient lighting is installed
instead of old and inefficient lighting. The degree of illumination
remains the same as it is determined that the old lighting
system meets modern standards in terms of illumination.
The School Board has entered into negotiations with a qualified
contractor taking into account a number of programs with
measures to increase energy efficiency. It is proposed that
payments are based on measured savings according to the price
of electricity at the time of contract signing. The M&V plan
defines, among other things, the manner of calculating savings.
Since users control the lighting system in the school, it is agreed
to implement Option A and to measure key parameters. Key
parameters are the capacity of the lighting system and the
number of operating hours. Details are worked out in the M&V
plan.
Factors affecting M&V concept.
When preparing the M&V Plan, the following facts have been taken into
considerations:

The whole lighting system is supplied by a standard low voltage electricity
grid (220 V) which is used only for the supply of the lighting system. This
fact simplifies the measurement of electricity consumption.
Since the old system of lighting (incandescent light bulbs) affects heat
energy requirements, it is necessary to consider and assess mutual effects
of two energy systems.
The existing lighting system affects also the cooling system. However,
during the hottest months, the school is not used. Therefore, the interaction
between these two systems can be neglected.
The School Board did not accept the contractors proposal to determine the
number of hours of lighting systems operations arbitrarily. Therefore, it is
agreed to monitor operations of the lighting system in the school. This test
should determine the reliable number of hours of the systems operations
during the baseline period and later during the calculation of savings.
M&V Plan. The boundaries of the lighting system are determined
in such a way to include all light bulbs which are connected to the
grid.
Interactive effect on heating is determined by technical
calculations. It is determined that heat energy required for the
heating system will be increased by 3% after the replacement
of incandescent light bulbs with highly efficient lights. This
refers to the whole heating period. The efficiency degree of the
boiler is 79% and it is determined by an independent test in
standard winter conditions.
Other factors, which are used for the preparation of the M&V
Plan include description, location, level of illumination and the
number of operational and burned out light bulbs.
The level of illumination is determined arbitrarily by setting up
30 luxmeters (data logger) in classrooms, corridors, dressing
room, etc. The test lasted for two months. The Table 3 gives
some data obtained during the test.
Location
Portion of Lighting
Subsystem in Total
Capacity
[%]
Average Number of Hours in a Week
[h/week]
Business Day
Holidays and
Weekends
Dressing Rooms 5 106 22
Offices 5 83 21
Classrooms 61 48 5
Amphitheaters 10 31 11
Halls 10 32 25
Corridors 9 168 168
Results of the Test for the Capacity of Lighting and Weekly Duration
of Lighting
Location
Portion of
Lighting
Subsystem
in Total
Capacity
[%]
Average Number of
Hours in a Week
[h/week]
Assessment of
Annual
Operating Hours
[h/year]
Business
Day
Holidays
and
Weekend
s
Dressing
Rooms
5 106 22 4,424
Offices 5 83 21 3,514
Classroom
s
61 48 + 6 5 2,172
Amphithe
aters
10 31 11 1,354
Halls 10 32 25 1,578
Corridors 9 168 168 8,770
Result. After the implementation of EEM, measurements are
repeated in all electric circuits as during the test to determine
baseline power. Maximum power is 162 kW with all new lights
turned on. There are no burned out lights. With the same
percentage of 1% for burned out lights, as in baseline period,
peak load is 160 kW (= 162 0.99).
Power reduction relevant for calculations is:
P 288 160 128 kW A = =
Expected electricity saving is:
E 128 2,792 357,376 kW/a A = =
Saving of power input is 128 kW during ten months and 50% of
that during two summer months. This is totally 1,408 kW for the
whole year.
Thus, total financial effects of electricity consumption for this
EEM is:
N (357,376 0.0510) (1, 408 8.79) 30,602 /a A = + =
Because of the above change of lights, the boiler for heat energy
production should deliver around 3% more energy during heating
season. It can be estimated that during a typical winter months
electricity consumption for lighting is equal to:
mon
357,376
EE 35,738 /a
10
= =
If it is determined that the consumption of heat energy is
increased (5 months) after the implementation of the EEM by
some 3%, the equivalent of primary energy of natural gas is
equal to:
0.03 35,738 5
NG 6,786 kWh/a
0.79

A = =
The calorific value of natural gas is 10.5 kWh/nm
3
so that
additional quantity of natural gas required for heating purposes
is equal to 646 nm
3
/year. The monetary value of this amount of
gas is 133.5.

Now, the total net savings is equal to: 30,602 133.5 = 30,468.5
/year.