Renewable Energy Guide for Highway Maintenance Facilities (2013)

Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

P A R T I I General Considerations

9 2.1 Overview Many highway maintenance facilities were constructed during the rapid expansion of the U.S. highway system following World War II. Aging infrastructure is now an issue as some facilities will be closed and replaced with new facilities while others will be repurposed, updated, or renovated. This offers significant opportunity to incorporate renewable energy technologies and energy efficiency strategies in the next generation of highway maintenance facilities. While an increasing number of state transportation departments have expressed an interest in or have plans to build more efficient facilities and include renewable energy features, it is also clear that budget pressures make this a challenging proposition.1 This is particularly true for facilities that will be built in regions that do not have relatively high utility prices or access to financial incentives to reduce the costs of the renewable energy systems. Nonetheless, consideration of renewable energy early in the process—from site planning to building design features—can make it possible to cost-effectively incorporate renewables at a later time. The location of a site selected for a new facility as well as the size and characteristics of the site can affect the facility’s energy use. In addition to the energy consumed by the building and its operations, consideration of the facility’s service area and commuting distance for employees will also affect the overall energy consequences of the project. If renewable energy is being considered as part of a project, a thorough analysis of the opportunities for its deployment should be made of any site under consideration. Additionally, environmental regulations (such as storm water management and treatment, site pollution containment) may have an impact on the selection of the site. Aspects of the site during the site selection process to consider, in addition to zoning restrictions, appropriate location, and adequate area, include: • Availability of utilities, • Access to adequate roadway infrastructure, • Setback requirements, • Floodplains and wetlands, • Slope, • Suitability of subsurface soils, and • Existing vegetation and/or development on the site. These items can all have an impact on the project budget and overall project feasibility, as well as the incorporation of renewable energy strategies. C H A P T E R 2 Overview of Highway Maintenance Facilities 1Under phase I of NCHRP Project 20-85, 13 of 17 state DOTs responding to a survey indicated that they had plans to imple- ment renewable energy systems at their facilities.

10 Renewable Energy Guide for Highway Maintenance Facilities If pursuit of a building rating certification [such as Leadership in Energy and Environmental Design (LEED)] is being considered, site selection can have a significant impact on the rating score of the project and should be an integral part of the site selection process. Site selection should be based on the nature of the operations to take place at the facility as well as the quantity and types of vehicles actively using the site. 2.2 Building Functional Characteristics Maintenance facilities serve a wide variety of needs, from simple maintenance and fluid changes for fleet cars and light trucks to major overhauls of large equipment such as bucket loaders, graders, and snowplows. They also frequently incorporate office and storage functions. A maintenance facility may house a number of personnel such as mechanics, drivers, road main- tenance crews, supervisors, and administrative staff. Any maintenance building will have an indoor space for mechanics to work on vehicles, ranging from a small bay to any number of large bays, the size dictated by the largest vehicle requiring servicing. Maintenance bays will have space for a mechanic to access the vehicle, tools, equipment, usually a vehicle lift, access to compressed air, and other aspects associated with vehicle repair and maintenance. Specialty bays or areas may also be required depending on the type of work; these can include welding and bodywork areas, tire repair, or other vehicle-related maintenance, each requiring specialty tools and design consideration. Wash bays require special consideration because of water capture, treatment, recycling, heating, and chemicals necessary for washing vehicles. Other common elements in maintenance facilities are break rooms, restrooms, showers, parts storage, hazardous materials storage (batteries, solvents, fuel, and so forth), outdoor parking, and sometimes indoor vehicle storage and parking. Each of these spaces has its own functional requirements, energy use profile, and potential for energy reduction and utilization of renewable energy. Table 2-1 summarizes the typical primary end-use energy load drivers for a number of common spaces. 2.2.1 Office Office spaces need to be kept at a comfortable temperature during working hours and meet general and task lighting requirements. For the heating and cooling requirements, it is common to find conditioned forced air ventilation. Plug loads include computers, copiers, and other typical office-type equipment. 2.2.2 Maintenance Bay Heating and cooling maintenance bays can be a challenge. Two of the main features are high ceilings for lift clearance and large door openings. When bay doors are open, they allow uncontrolled infiltration, and the bays equalize with the ambient atmosphere. In addition, extra ventilation must be accounted for—1.5 cubic feet of air per minute removed per square foot of shop space,2 with powered direct ventilation for any stationary running engines inside the building. Air cannot be recirculated from garage bays, but is directly exhausted. Such large ventilation loads require a large quantity of outdoor air to replace the heated exhaust air. In conjunction with heating the incoming air, many shop spaces use radiant heaters, either the infrared overhead gas-tube type or in-floor radiant heat. 2ASHRAE, 2010a. Table 6.4, Minimum Exhaust Rates.

Overview of Highway Maintenance Facilities 11 Many areas of the United States do without mechanical cooling in the bay areas. This neces- sitates natural ventilation schemes that allow hot air to escape from the top of the building while bringing in cooler air from ground level, or forced ventilation without cooling. 2.2.3 Restrooms/Showers/Lockers Depending on the number of people at the site, restrooms may be shared with office areas or be separate and can include showers and locker room areas. In some cases, dedicated laundry facilities are provided. Energy loads include water heating for showers, laundry, and lavatory sinks. Electrical loads include lighting, hand dryers, and exhaust air ventilation systems. American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE) standards for bathroom ventilation are 50 cubic feet per minute (cfm)/fixture continuous or 100 cfm/fixture. 2.2.4 Break/Kitchen/Training Break rooms and kitchens may have a varying level of equipment, but often will include a water cooler, vending machines, coffee maker, microwave, refrigerator, dishwasher, and sink. 2.2.5 Storage Storage can range in complexity from an outdoor area where equipment such as plows are kept, to more complex or separate areas for storage of batteries, tires, flammable liquids, and parts. Plug Loads Heating and Cooling Ventilation Lighting Water Heating Office Computers, office equip. up to 50% of electric load Forced air 2–3 ACH 10 fc general, with additional task lighting ~30 fc Maintenance bay Compressed air system, power tools, welders, installed equipment Very little forced air – mostly radiant heating 20–30 ACH 10 fc general, portable task lighting Restrooms/ showers/lockers N/A Forced air Exhaust fan always on. 5– 6 ACH 10 fc general Hot water Break/kitchen Microwave, refrigerator, water cooler, etc. Forced air 5–6 ACH 10 fc general Hot water Training/meeting TV, projector, computers, etc. Forced air 2–3 ACH 10 fc general Storage Inventory, computers Minimal – forced air, if conditioned at all 2–3 ACH, unless specialized storage (batteries, tires, fuel, etc.) 5–10 fc Parking/security lighting Block heaters, electric vehicle charging N/A N/A Security lighting, ~5 fc Wash bays N/A Forced air or radiant heat 20–30 ACH 10 fc general Hot water Note: ACH = air changes per hour; fc = foot candles. Table 2-1. End-use energy load drivers by space type or function type.

12 Renewable Energy Guide for Highway Maintenance Facilities Certain types of storage may have special requirements or limitations. Refer to the requirements of the applicable building code and its referenced standards for specific requirements for storage of these types of items. 2.2.6 Parts Inventory Most repairs involve some sort of powered tools. Many shops have a central compressed air system to run a variety of tools, including impact wrenches and grinders. Hydraulic pumps and hydraulic pressure systems are used for lifts, presses, and tire mounting machines, among others. Lighting, exhaust ventilation, parts washers, metalworking machines, welders, vacuums, and any variety of other tools used in the process of maintaining vehicles and the building itself contribute to energy use. 2.2.7 Parking/Security Lighting Parking lot lighting can consume a significant amount of electrical energy. Typical lighting at highway maintenance facilities includes parking lot and exterior storage areas. Other loads external to the building can include vehicle crankcase heaters (in cold climates) and electric vehicle charging stations. Crankcase heaters represent a considerable power draw and should be considered in determining facility electrical demand. 2.2.8 Specialty Many maintenance facilities will require spaces for specialized tasks outside of mechanical work. These specialty needs may require specific building designs and energy needs. 2.2.8.1 Wash Bays Cleaning vehicles regularly can increase the longevity of the vehicles by making needed repairs, leaks, or corrosion easier to spot. Vehicle washing is therefore usually a part of a highway maintenance facility. Wash bays can be a dedicated space to wash vehicles within a garage or an automated system in a separate building for larger facilities. In some climates, the wash bay may be external to the building. Most codes require oil separators to treat wastewater from vehicle washing. Washing with heated water is a common practice in some areas and increases the effectiveness of soaps used. Heating and ventilation considerations can be similar to maintenance bays but must account for additional moisture/water vapor. This includes provisions to prevent freezing of water that drips off of the vehicles as they exit the facility. 2.2.8.2 Battery/Chemical Storage Rooms Battery storage and chemical storage are separate tasks that require separate and dedicated spaces. Consult with the appropriate sections of Occupational Safety and Health Administration (OSHA), National Fire Protection Association (NFPA), and International Building Code (IBC) codes for the proper design and operation of these facilities. 2.2.8.3 Other Depending on the complexity of the highway maintenance facility, there may be a variety of other activities with significant energy requirements, including: • Welding. Highly energy intensive and produces large quantities of air contaminants. Use of modern inverter welding power sources can reduce the fume generation for pulsed-gas metal arc welding,3 and local, demand-controlled ventilation can exhaust welding fumes, much the same as with vehicle exhaust systems. 3Zhivov, 2006. http://www.pertan.com/FTLee/Zhivov_Welding.pdf.

Overview of Highway Maintenance Facilities 13 • Paint booth. Highly energy intensive, the painting process uses pumps for paint sprayers or sophisticated electrodeposition. Lighting is provided on five sides of a square paint enclosure to provide uniform lighting while painting. OSHA standard 1910.94(c)(4) regulates the construction of spray booths and ventilation. Ventilation is required in paint spray booths to prevent paint or solvent vapors from reaching lower explosive limits, and this can also be energy intensive. Some paint booths are heated after application of paint, while maintaining the air quality, to aid in curing various types of paints and clear coats. 2.3 Energy Use in Maintenance Facilities Energy use in maintenance facilities varies widely based on the specific construction charac- teristics of the buildings, their size, and their location. NREL estimates that energy use intensity (EUI) is between 27 and 101 thousand Btu per square foot per year (kBtu/ft2/year), although some sources estimate it as high as 120 kBtu/ft2/year. Maintenance facilities and vehicle service shops across the country have a number of unique attributes that contribute to an energy use profile that is quite unlike most other commercial buildings. One of these attributes is that a large portion of the buildings usually consist of vehicle repair bays, which are large, open spaces with high clearance, high ventilation demand, high heating demand in winter, and generally no cooling in summer. Even with attached office space, the vehicle bays are often a main driver of total energy consumption because of their design. The 2003 Commercial Building Energy Consumption Survey (CBECS) shows that by far the main drivers of energy use in the vehicle service category are heating and lighting, followed by process loads, which are categorized as “miscellaneous” (see Figure 2-1).4 Process loads are generally the energy/load required to run equipment used in the servicing or repair of vehicles, including compressed air systems, welding, and any number of power tools used. Recently, the U.S. Army Corps of Engineers Construction Energy Research Laboratory (CERL) and NREL worked together to examine energy use and possible energy reduction strategies for tactical equipment maintenance facilities (TEMFs). In order to do this, they developed an EnergyPlus energy model of a TEMF in each ASHRAE climate zone (see Figure 2-2) using minimum performance values from ASHRAE 90.1-2007.5 These modeled values were taken as the baseline levels for TEMF locations and are much lower than the CBECS 2003 data for “other repair service” buildings (see Table 2-2). The TEMF simulations have slightly different energy use categories than CBECS, so a direct comparison is not possible. However, in most climates heating dominates the energy use, followed by ventilation, lighting, and process energy (see Figure 2-3).6 When comparing the TEMF-modeled end use characteristics with the CBECS data for the dif- ferent climate zones, it is apparent from both that lighting energy is relatively constant regardless of location. It follows that daylighting strategies may hold significant promise for the latitudes that have more consistent daylight during operating hours (Figure 2-4). The CBECS survey shows a large proportion of heating energy even in warm climates (see Table 2-3), while the TEMF model shows an expected decrease. (Note that the TEMF model uses different climate zone notations than CBECS.) This may mean that measures to reduce heating energy should be examined for more moderate climate regions as well as for colder climates. 4U.S. Department of Energy. Buildings Energy Data Book. http://buildingsdatabook.eren.doe.gov/CBECS.aspx. 5EnergyPlus is hourly building energy analysis software and is available from U.S. DOE. http://apps1.eere.energy.gov/ buildings/energyplus/. 6Langner, 2012.

14 Renewable Energy Guide for Highway Maintenance Facilities Source: http://resourcecenter.pnl.gov/cocoon/morf/ResourceCenter/dbimages/full/973.jpg. Figure 2-2. ASHRAE climate zone map. Source: CBECS, 2003. 55% 17% 12% 6% 4% 3% 1% 1% 1% Heating Lighting Miscellaneous Ventilation Refrigeration Cooling Water Heating Computer Use Office Equipment Figure 2-1. Energy consumption by end use, vehicle service commercial buildings.

Overview of Highway Maintenance Facilities 15 ASHRAE Climate Zone City CBECS 2003 Site Energy Budget kBtu/ft2(kWh/m2) Baseline Site Energy Budget kBtu/ft2 (kWh/m2) 1A Miami, FL 85 (268) 27 (85) 2A Houston, TX 84 (265) 33 (104) 2B Phoenix, AZ 82 (259) 31 (98) 3A Memphis, TN 84 (265) 41 (129) 3B El Paso, TX 79 (249) 36 (114) 3C San Francisco, CA 76 (240) 32 (101) 4A Baltimore, MD 93 (293) 55 (173) 4B Albuquerque, NM 83 (262) 46 (145) 4C Seattle, WA 86 (271) 51 (161) 5A Chicago, IL 100 (315) 68 (214) 5B Colorado Springs, CO 90 (284) 58 (183) 6A Burlington, VT 111(350) 78 (246) 6B Helena, MT 101(319) 74 (233) 7 Duluth, MN 119(375) 94 (296) 8 Fairbanks, AK 158(498) 138 (435) Source: NREL/CP-5500-53810. Table 2-2. CBECS 2003 “other repair service” versus TEMF-modeled baseline EUI. Source: NREL/CP-5500-53810. Figure 2-3. TEMF baseline annual energy consumption by end use.

16 Renewable Energy Guide for Highway Maintenance Facilities Table 2-3. Annual energy consumption and EUI by fuel, end use, and climate zone. Vehicle Service (CBECS, 2003) Nationwide Total Vehicle Service (CBECS, 2003) ASHRAE Climate Zones 7,6 Vehicle Service (CBECS, 2003) ASHRAE Climate Zone 5 Vehicle Service (CBECS, 2003) ASHRAE Climate Zone 4 Vehicle Service (CBECS, 2003) ASHRAE Climate Zone 3 Vehicle Service (CBECS, 2003) ASHRAE Climate Zones 2, 1 Fuels BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 Electricity Natural gas Fuel oil All major fuels 37,820 31.27 46,770 38.67 4,040 3.34 88,630 73.28 9,479 39.28 15,544 64.41 297 1.23 25,320 104.92 8,936 28.82 10,063 34.54 1,935 6.64 20,395 69.99 7,724 34.98 7,507 34 1,409 6.38 16,640 75.36 7,067 22.03 6,781 21.13 397 1.24 14,245 44.4 5,153 38.15 6,845 50.89 2 0.01 12,029 89.06 End Use BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 BBtu kBtu/ft2 Heating Cooling Ventilation Water heating Lighting Cooking Refrigeration Office Equipment Computer use Miscellaneous 48,871 40.41 2,524 2.09 4,960 4.1 1,207 1 15,488 12.81 12 0.01 3,620 2.99 490 0.41 835 0.69 10,620 8.78 15,609 64.68 376 1.56 1,525 6.32 605 2.51 3,809 15.78 0 0 910 3.77 155 0.64 287 1.19 2,045 8.47 11,778 40.42 259 0.89 800 2.74 192 0.66 3,742 12.84 0 0 1,888 4.08 150 0.52 139 0.48 2,146 7.36 8,536 38.66 552 2.5 1,057 4.79 207 0.94 2,788 12.63 0 0 721 3.27 93 0.42 177 0.8 2,508 11.36 7,348 22.9 660 2.06 875 2.73 107 0.33 2,930 9.13 12 0.05 485 1.51 61 0.19 128 0.4 1,637 5.1 5,600 41.46 677 5.01 702 5.2 97 0.72 2,218 16.42 0 0 315 2.33 31 0.23 104 0.77 2,285 16.91 Vehicle service sample size: 125 represents 212,817 buildings w/ total area of 1,209,465,858 Sample size: 21 represents 28,523 buildings w/ total area of 241,336,600 ft2 Sample size: 21 represents 28,523 buildings w/ total area of 241,336,600 ft2 Sample size: 21 represents 36,817 buildings w/ total area of 220,805,100 ft2 Sample size: 30 represents 55,579 buildings w/ total area of 320,869,808 ft2 Sample size: 13 represents 21,713 buildings w/ total area of 135,076,850 ft2 Source: CBECS, 2003. Note: BBTu = billion Btu. *Due to the few buildings (13) that were sampled in these regions, these data are not considered representative. Source: CBECS, 2003. 0 20 40 60 80 100 120 Vehicle Service (CBECS 2003) Nationwide Average Climate Zones 1 -2* Climate Zone 3 Climate Zone 4 Climate Zone 5 Climate Zones 6 -7 Heating Lighting Miscellaneous Ventilation Refrigeration Cooling Water Heating Computer Use Office Equipment EU I ( kB tu /s f / yr ) Figure 2-4. Vehicle service building EUI by end use and climate zone.

Overview of Highway Maintenance Facilities 17 Figure 2-5 shows the energy end-use distribution as a function of building size (floor area). Table 2-4 displays this same information in tabular form. The wide variety of energy use exhibited by maintenance facilities results in a range of energy saving or renewable solutions being most effective depending on climate, building size, and use characteristics, among other factors. Both the TEMF and CBECS data show that lighting energy use is relatively constant. Table 2-4. Annual energy consumption and EUI by end use and building floor areas. Vehicle Service (CBECS, 2003) Nationwide Total Vehicle Service (CBECS, 2003) 1,001–5,000 ft2 Vehicle Service (CBECS, 2003) 5,001–10,000 ft2 Vehicle Service (CBECS, 2003) 10,001–25,000 ft2 Vehicle Service (CBECS, 2003) 25,001–50,000 ft2 Fuels Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Electricity 37,820 31.27 9,324 25.52 7,082 26.33 15,765 39.74 4,271 27.49 Natural gas 46,770 38.67 5,368 14.69 10,622 39.49 22,555 56.85 8,225 52.93 Fuel oil 4,040 3.34 1,672 4.58 1,757 6.53 601 1.51 1.11 0.01 All major fuels 88,630 73.28 16,364 44.79 19,461 72.35 38,920 98.1 12,498 80.43 End Use Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Total BBtu kBtu/ft2 Heating 48,871 40.41 7,336 20.08 11,740 43.65 21,543 54.3 8,251 53.1 Lighting 15,488 12.81 3,512 9.61 3,493 12.99 6103 15.38 1,683 10.83 Miscellaneous 10,620 8.78 2,163 5.92 2,293 8.52 5074 12.79 871 5.6 Ventilation 4,960 4.1 640 1.75 713 2.65 2618 6.6 771 4.96 Refrigeration 3,620 2.99 1,881 5.15 609 2.27 989 2.49 104 0.67 Cooling 2,524 2.09 455 1.25 203 0.75 1,122 2.83 564 3.63 Water heating 1,207 1 105 0.29 170 0.63 764 1.93 167 1.08 Computer use 835 0.69 178 0.49 107 0.4 467 1.18 61 0.39 Office equipment 490 0.41 94 0.26 132 0.49 227 0.57 26 0.17 Cooking 12 0.01 0 0 0 0 15 0.04 0 0 Sample size: 125 represents 212,817 buildings with total area of 1,209,465,858 ft2 Sample size: 59 represents 141,231 buildings with total area of 365,372,100 ft2 Sample size: 24 represents 38,082 buildings with total area of 268,969,200 ft2 Sample size: 29 represents 27,458 buildings with total area of 396,732,250 ft2 Sample size: 11 represents 5,046 buildings with total area of 155,398,308 ft2 Source: CBECS, 2003. Figure 2-5. Vehicle service EUI by end use and size. Source: CBECS, 2003. 0 20 40 60 80 100 120 Vehicle Service (CBECS 2003) Nationwide Average 1,001 - 5000 sf 5,001 - 10,000 sf 10,001 - 25,000 sf 25,001 - 50,000 sf Cooking Computer Use Office Equipment Water Heating Refrigeration Cooling Ventilation Miscellaneous Lighting Heating EU I (k BT tu /s f/ yr )

18 3.1 Why Use Renewable Energy? The buildings in which we work serve a wide variety of purposes, protect us from nature’s extremes, and yet also affect our health and environment. As the environmental impact of buildings has become more apparent, sustainable design and renewable energy have become ever more important. Sustainability and renewable energy go hand in hand, although it is possible to pursue either strategy independently. Sustainable buildings work to optimize energy efficiency and renewable energy, water efficiency and use, building materials selection, waste reduction, toxin reduction, indoor air quality, and smart growth and development. In general, the most effective approaches seek to minimize the building’s energy requirements through energy efficiency and climate-sensitive design, use efficient equipment and design strategies, and incorporate renewable energy where feasible to meet a portion of the remaining energy needs (see Figure 3-1). Energy efficiency and energy conservation play key roles in reducing energy requirements and the size of the load that must be met by renewable energy. High-performance buildings employing aggres- sive energy efficiency and conservation measures can reduce loads by 50% or more compared to standard buildings. Since renewable energy systems have relatively high capital costs and low operating costs, smaller systems will result in lower project costs. There are many different strategies on how to approach each issue in an organized, robust manner and to create a balance between them that results in better buildings with lower environmental impacts. These strategies have been codified into ratings systems, building and construction codes, and a number of guides: • ASHRAE Standard 189.1.7 ASHRAE Standard 189.1 addresses site sustainability, water use efficiency, energy efficiency, indoor environmental quality (IEQ), and the building’s impact on the atmosphere, materials, and resources. These five key subject areas, as well as plans for construction and high-performance operation, are each addressed in a separate chapter. Standard 189.1 is used in conjunction with ASHRAE/Illuminating Engineering Society of North America (IESNA) Standard 90.1-2007, and ASHRAE Standards 62.1-2007 and 55-2004, but any requirements supersede those standards. • International Green Construction Code (IGCC).8 The IGCC creates a regulatory framework for new and existing buildings, establishing minimum green requirements for buildings and complementing voluntary rating systems that may extend beyond the customizable baseline of the IGCC. The code acts as an overlay to the existing set of international codes, including C H A P T E R 3 General Project Considerations 7ASHRAE, 2010b. Standard 189.1, The Green Standard. http://www.ashrae.org/resources--publications/bookstore/ standard-189-1. 8The International Code Council (ICC), 2012 International Green Construction Code. Washington, D.C., March 2012.

General Project Considerations 19 provisions of the International Energy Conservation Code (IECC), International Code Council (ICC-700), and the National Green Building Standard, and incorporates ASHRAE Standard 189.1 as an alternate path to compliance. • LEED certification.9 LEED certification provides independent, third-party verification that a building, home, or community was designed and built using strategies aimed at achieving high performance in key areas of human and environmental health: sustainable site development, water savings, energy efficiency, materials selection, and indoor environmental quality. • Green Globes.10 Green Globes is a web-based program for green building guidance and certi- fication that includes an on-site assessment by a third party. Green Globes offers a streamlined and affordable alternative to LEED as a way to advance the overall environmental performance and sustainability of commercial buildings. It is suitable for a wide range of buildings such as large and small offices, multifamily structures, hospitals, and institutional buildings such as courthouses, schools, and universities. • Whole Building Design Guide.11 Whole building design provides the strategies to achieve a true high-performance building: one that is cost-effective over its entire life cycle, safe, secure, accessible, flexible, aesthetic, productive, and sustainable. Through a systematic analysis of these interdependencies, and leveraging whole building design strategies to achieve multiple benefits, a much more efficient and cost-effective building can be produced. In addition to the guides, there is increasing interest in developing net zero energy (also referred to as zero net energy) buildings or communities as a means to dramatically reduce the energy and environmental footprint of facilities. A net zero energy building is one that derives enough energy from on-site renewable resources to totally offset any purchased energy from the utility Figure 3-1. Renewable energy technologies and design strategies complement energy efficiency and conservation to meet building energy requirements. 9U.S. Green Building Council. “What LEED Is.” http://www.usgbc.org/DisplayPage.aspx?CMSPageID=1988. 10Green Building Initiative, 2012. “Green Building Programs.” http://www.thegbi.org/green-globes. 11Whole Building Design Guide. “Whole Building Design.” http://www.wbdg.org/wbdg_approach.php.

20 Renewable Energy Guide for Highway Maintenance Facilities or other off-site sources on an annual basis. The term net recognizes that there are periods during which purchased energy may be required (e.g., when there is insufficient solar resource), but that over the course of the year, this will be balanced by excess energy generated on-site, which can be put back into the utility grid. A zero energy building is one that derives all its energy from on-site renewable resources and does not require energy purchases from off-site sources. In the federal government, Executive Order 13514 establishes a requirement that new buildings constructed after fiscal year 2030 must be net zero energy buildings and also includes a solar water heating requirement (http://www.whitehouse.gov/administration/eop/ceq/sustainability). The Depart- ment of Defense is piloting net zero energy military installations (http://www1.eere.energy.gov/ office_eere/pdfs/48876.pdf). Several states are involved in establishing net zero energy building policies, and certification programs for net zero energy buildings are being established (http:// living-future.org/netzero/). Energy for use in constructing and operating buildings has been calculated to be almost half of all the energy used in the United States (48.7%). The building sector consumes over three quarters of all electricity generated in the United States (75.7%).12 Utility energy costs fluctuate with supply and demand. With increasing demand for most forms of energy and evermore questionable supplies, future operation costs are a major consideration for most building owners. Even when state-of-the-art sustainable practices are incorporated, additional energy is required for building operation in most cases. Incorporating renewable energy capture on new or existing buildings can significantly reduce, offset, or replace the amount of utility-produced energy required. This can have many positive effects on the economic and environmental impact of a building project. 3.1.1 Economic Benefits Reduced Operating Costs Renewable energy systems can reduce the cost of building operations. When properly inte- grated into the building design, renewable energy systems can replace a significant portion (or all) of the energy purchased from the grid. Price Stability Since renewable energy sources reduce the need for purchased energy, they can act as a hedge against volatile or increasing utility costs. Depending on the location of the project and the appli- cable utility regulations, incorporation of a renewable energy system may qualify for a fixed (or preferred) electric rate, resulting in predictable future utility costs and additional cost savings. Income from Renewables Where utilities are required to produce a portion of the energy from renewable sources, build- ing or system owners may be able to sell renewable energy certificates (RECs) for the energy they produce to the utility. The sale of these RECs can further offset the building owner’s energy operating costs. Employment Each project incorporating renewable energy will help stimulate the emerging renewable energy industry by creating a market for products and the specialized labor required for instal- lation. The operation and maintenance (O&M) of these systems will create further economic activity downstream. 12Architecture 2030, Santa Fe, NM, 2011, http://architecture2030.org/the_problem/problem_energy.

General Project Considerations 21 3.1.2 Environmental Benefits Carbon and Other Emissions By reducing the consumption of fossil fuels, renewable energy systems can reduce the emis- sion of carbon dioxide and other greenhouse gases, as well as air pollutants associated with the burning of these fuels. When replacing consumption of fossil-fuel–generated electricity, renew- able energy systems reduce the amount of power plant emissions released into the atmosphere. Extraction/Disposal Impacts In addition to the reduction of emissions associated with the burning of fossil fuels, renewable energy technologies can also reduce the need for extracting them from the earth. This results in a reduction of the environmental impact of resource extraction and the related disposal of any waste materials produced from their extraction (such as brine) or combustion (such as ash). Thermal Pollution Fossil fuel combustion and nuclear power generation also produce excess heat that can change the environment by raising the temperature of the air or water. Renewable energy systems have much less thermal impact on the environment. 3.1.3 Energy Security Benefits By reducing our reliance on imported fuel sources and a vulnerable electricity grid, renewable energy capture and distributed generation can improve the security of our country and our buildings. In the future, clean, reliable sources of energy will be necessary for our national security, economic stability, and public health. Imported Fuel The transportation sector of our economy relies almost exclusively on oil for its fuel supply, and oil is still a heating source in some areas of the United States. Almost half of all oil consumed in the United States is imported. In our complex geopolitical world, the supply of oil is a major part of our energy security over which we have little control. Alternative and renewable sources of energy can help create a more secure energy supply. Distributed Generation On-site production of electricity can provide additional electric power reliability to the facility. Furthermore, on-site or distributed generation does not incur the losses associated with transporting power over long distances. The inefficiencies in transmission and distribu- tion result in a grid-wide loss of about 7% of all electrical energy produced in the United States.13 In addition, the complexity of the grid results in a degrading of the quality of the power delivered (variations in voltage, transients, and so forth). It is estimated that American businesses suf- fer over 75 billion dollars of losses due to power outages and quality disturbances each year.14 Distributed generation also can help the grid by reducing peak demand and total loads. 3.1.4 Mandated Requirements Policy The incorporation of renewable energy may not be a choice on some future projects. Due to concerns related to the environment, energy security, and economics, the federal government and 13U.S. Energy Information Administration. Frequently Asked Questions: How much electricity is lost in transmission and distribution in the United States? www.eia.gov/tools/faqs/faq.cfm?id=105&t=3. 14LaCommare et al., 2004, p. 26.

22 Renewable Energy Guide for Highway Maintenance Facilities many states have mandated the use of renewable energy and/or sustainable design strategies for new projects and major renovations. Examples are: • Energy Policy Act of 2005. Requires purchase/use of renewable energy in federal projects with a credit bonus for RE generated on-site. • Executive Order 13423. Requires that at least half of renewable energy in federal projects come from new RE sources. • Executive Order 13514, High Performance Buildings/Sustainable Design. Requires that all federal buildings that enter the design phase after 2020 attain zero net energy usage by 2030. • Arizona Executive Order 2008-29. Requires that 10% of energy be derived from renewable energy sources for state-funded new construction. • California 2013 Building Energy Efficiency Standards (Title 24). Scheduled to take effect on January 1, 2014, require 30% more efficient nonresidential construction than the current stan- dard. Solar-ready roofs to accommodate future installation of solar photovoltaics or solar ther- mal systems are also required. The rules also apply to major building additions and retrofits. • Multiple states. Require LEED certification at silver or gold level, which in most cases will require on-site renewable energy generation or purchase of electricity that is produced from renewable sources. Code Building codes are evolving to reflect these governmental concerns. The IGCC,15 released in the spring of 2012, and ASHRAE Standard 189.116 have renewable energy provisions. The Ameri- can Institute of Architects is working to encourage adoption of the IGCC in all 50 states. 3.1.5 Lead by Example At the federal, state, and local level, government has an opportunity to lead by example by designing sustainable and energy-efficient buildings, installing renewable energy systems, monitoring their performance, and sharing information. 3.2 The Process of Identifying Renewable Energy Options To be most successful, renewable energy systems should be installed on buildings that have also incorporated features to minimize energy use. Unlike utility energy sources (e.g., natural gas, fuel oil, and electricity), the supply of renewable energy is intermittent and variable. The renewable energy system must be integrated into the design of the building and building systems to maximize its effectiveness and economic feasibility. This process is described as whole building or integrated design. Integrated design results in sustainable buildings that are cost-effective over their defined life cycle and meet other programmatic needs and requirements (such as being accessible, safe, secure, flexible, and aesthetically pleasing). 3.2.1 Energy Efficiency In most cases, energy derived from renewable sources costs more per unit of energy delivered than energy from utility sources—though some renewable energy technologies are approaching 15International Code Council, 2012. International Green Construction Code. 16ANSI/ASHRAE/USGBC/IES Standard 189.1-2009.

General Project Considerations 23 the costs of utility-delivered energy. Because of this, the impact of the energy efficiency of the building and any passive design strategies such as daylighting and natural ventilation is amplified when considering renewable energy technologies on a proposed project. As a general rule, energy efficiency and passive design strategies should precede the incorporation of renewable energy systems in order to maximize return on any investment in renewable energy systems. For renovation projects this may not be feasible, and where economic considerations can justify the addition of PV or wind strategies to offset electric utility costs, it may not be necessary. 3.2.2 Sustainable Design With the advent of sustainable building rating systems (like the LEED rating system), it became apparent that the traditional process of building design was not capable of producing the desired outcomes due to the complex interrelations of buildings, sites, and systems on these types of projects. To avoid situations where decisions made early in the process worked against the stated project goals later, integrated design processes were identified as necessary for success. Integrated design is now required by many federal, state, and local jurisdictions and private entities and is rapidly replacing the traditional design process on projects of all types. 3.2.3 Integrated Design As stated in Integrated Project Delivery: A Guide, by the American Institute of Architects, integrated project delivery is a “project delivery approach that integrates people, systems, business structures, and practices into a process that collaboratively harnesses the talents and insights of all participants to optimize project results, increase value to the owner, reduce waste, and maximize efficiency through all phases of design, fabrication, and construction.”17 Simply stated, it is a multidisciplinary collaboration of all stakeholders and consultants from project conception to completion. This differs from the traditional process, which is much more linear and segmented. Traditionally the owner employs an architectural consultant who brings in additional consultants as necessary, solicits bids, and obtains permits, and then the construction team is engaged. In integrated design, the owner, designer, consultants, code officials, contractors, and commission- ing agents participate in the project from beginning to end. Recognizing that the ability to affect cost and functional capabilities decreases while the costs of design changes increase as the project progresses, integrated design endeavors to move design decisions to an earlier stage of the process where their impact on positive outcomes is maximized and the costs of changes are minimized. Practice has shown that this process produces the best results on projects incorporating high- performance sustainable design and renewable energy strategies and is essential to completing the requirements of building rating systems. 3.3 Pathways to Incorporate Renewable Energy into Highway Maintenance Facilities This guidebook includes a review of renewable energy technologies and an analysis of the energy loads usually present in highway maintenance and transportation buildings of various configurations and construction types. The nature of the energy loads and the renewable energy sources are examined and compared to define a path for the incorporation of renewable energy sources that are appropriate for the proposed building project. 17The American Institute of Architects, 2007.

24 Renewable Energy Guide for Highway Maintenance Facilities 3.3.1 Applications Project types and renewable energy applications addressed by this guide include: • Construction of new buildings, • Additions to existing facilities, • Renovations of existing facilities, • Adaptive reuse of existing facilities, and • Stand-alone supplemental renewable energy added to existing facilities without other work. 3.3.2 Building Use The focus of the guide is on highway maintenance facilities. Depending on the size of the facility, a variety of ancillary and support areas may be part of the project. As indicated in Section 2.2 in more detail, these activities can include: • Maintenance garage bays and the following support areas: – Restrooms/showers/lockers. – Break, training, and meeting rooms. – Parts inventory/parts counter. • Specialty activities (included in some but not all highway maintenance facilities): – Wash bays. – Battery charging area. – Chemical storage rooms. – Compressor rooms. – Welding areas. • Fueling area. • Vehicle storage. • Salt and other bulk maintenance material storage areas (usually outdoors but often under cover). • Office area—the areas listed in the following may be shared with the maintenance area or be separate facilities, depending on scope of project: – Restrooms. – Break room. – Training and meeting room. 3.3.3 Building Form The form or configuration of a building can enhance the performance of a renewable energy system or the energy efficiency of the building. It is important in the design process to consider potential applicable renewable energy technologies prior to committing to the building form and configuration. For example, in higher latitudes, solar photovoltaic collectors will perform better on a more steeply sloped roof than on a roof that is horizontal. When considering energy efficiency, knowing that a two-story building has less surface area, and therefore less heat loss, than a one-story building of equal square footage can affect the design process. The most efficient building solutions will be the ones where the form and configuration of the building work with the renewable energy technology to optimize performance. 3.3.4 Building Construction Types Vehicle maintenance garages are constructed using a variety of construction materials and systems. Many of the renewable energy technologies presented in this guide are applicable to any of the types of construction encountered. However, some technologies may work best with a particular type of construction.

General Project Considerations 25 Building codes establish maximum allowable floor area and building height based on the type of construction used and the intended occupancy. The IBC has been adopted or is in use in all 50 states and many U.S. territories. In project planning, selection of construction type and the related code limitations can have an impact on selection of renewable energy systems (and the overall project budget). Again, as this can be a consideration in the incorporation of renewable energy in a project, awareness of these code limitations during the design process is important to a successful project. 3.3.5 Occupancy Use Group As indicated previously, highway maintenance facilities can include a variety of ancillary activities. Of the 10 use groups defined by the IBC, three are found in most highway maintenance facilities: • Use Group A: Assembly (e.g., meeting and training rooms). • Use Group B: Business (e.g., management and business offices). • Use Group S: Storage (e.g., vehicle repair areas, enclosed vehicle storage, and parts storage). In most instances, the activities within the space will be the major determination of appropriate renewable energy technologies rather than the building code limitations. In planning for highway maintenance facilities, knowledge of the various use groups and the code-imposed limitations in height and area will affect the overall project planning more than renewable energy system selection. 3.4 The Project Development Process When renewable energy has been identified as one of the goals of a project, it will affect the project planning process. To incorporate renewable energy into a highway maintenance facility project, an organized and prioritized approach is required. How the renewable energy system is incorporated will depend on many variables that will affect the feasibility and cost of the system and project. For a new construction project or an addition to an existing facility, renewable energy strategies and the project’s programmatic requirements need to be fully integrated. When an existing facility is to be renovated or reused for another purpose, analysis of the existing conditions can provide direction to successful renewable energy strategies. When the addition of a renewable energy system is the sole purpose of a project, such as adding a solar PV array or wind turbine to an existing facility, matching of the energy loads and available renewable energy resources will provide the best results. Identification of project goals, budget, and resource availability are essential to achieving successful outcomes. The basic process for building project development consists of four major phases, as illustrated in Figure 3-2: pre-design, design, construction, and operation and maintenance. When renewable energy is included, there are additional activities that are required within each phase. The process is summarized in Table 3-1, and the details are discussed in Sections 3.4.1 through 3.4.4. In these sections, elements of the process described apply to both traditional project delivery and integrated design project delivery methodologies. Integrated design differs from traditional methods of project delivery by engaging as many of the participants in the building process as is practical and as early as possible and maintaining their involvement from project inception to post-occupancy. This participation by all involved parties allows their input and incorporates their expertise earlier in the project and generally results in better coordination due to their continued involvement. Integrated design strategies are well defined but can vary based on bidding require- ments and other restrictions. In an integrated design project, the team members performing the various tasks described will have been brought in to the process earlier, and their contributions may be more fully integrated.

26 Renewable Energy Guide for Highway Maintenance Facilities Establish Program Determine Team Determine Delivery Approach Schematic Design Preliminary and Final Design Design Phase Construction Commissioning Operation and Maintenance Pre-Design Phase Construction Phase Operation and Maintenance Phase Review Site and Regulatory Issues Construction Documents Figure 3-2. Project development process. 3.4.1 Pre-Design Phase Establish Program Any building project, whether it is new construction, a renovation, a reuse, or an addition, is essentially a problem-solving exercise. Incorporation of renewable energy is simply another part of the problem-solving process. In order to solve the problem, it is essential to have a thor- ough definition of what it is. In architecture, the building program is the problem definition phase of the project. It can be performed by the project owner prior to engagement of the architect or building team. It can be performed by consultants who specialize in space analysis and needs assessment, or it can be performed with the assistance of the architect. In a proj- ect using the integrated project delivery process, it may be defined during a design charette. A design charette is a workshop that includes the architect, mechanical and electrical engineering consultants, renewable energy consultants, commissioning agents, contractors, building occupants, and the owner. Depending on the complexity of the project, other stakeholders that may participate are utility companies, building officials, regulatory agencies, and loan institutions. Regardless of how it is executed, the programming process defines the scope of the work to be performed. It documents the goals of the owner by engaging stakeholders in the project. Recognizing the limitations of budget, area, form, and arrangement, the defined goals need to be

General Project Considerations 27 prioritized. Goals for a stand-alone renewable energy project will be quite different from those for a project where renewable energy is incorporated as one part of a much more complicated building program. A stand-alone project’s goals will be driven by performance and cost relative to the available renewable resource and the facility’s energy demand. A project where the renew- able energy system is one element of many defined goals will require additional integration and prioritization to optimize the system within the total project. Project goals may include design considerations addressing the aesthetics of the building, organizational goals of the building owner as part of an overall business plan, functional goals for efficient operations and organization of space, definition of current and projected space requirements, a conceptual budget with consideration of first costs versus life-cycle costs, and the schedule for the project. Detailed programming information includes a complete analysis of all activities to be housed within the project. When renewable energy is included in the project scope, the building goals and requirements need to mesh with the goals and requirements for the renewable energy system. Goals and objectives for the renewable energy system to be included in the building program may include, but are not limited to, the following: Pre-Design Pre-Design Program: project goals, budget, schedule, and priorities Delivery approach Team composition Site and regulatory issues Select design or design/bid firm Program: include energy and RE goals Delivery approach: consider integrated project delivery and whole building design, as appropriate Team composition: include energy and RE consultants, building-energy modeling consultants, and commissioning consultants Pre-design workshop/design charette Site analysis and initial screening of RE technologies and strategies Select RE technologies and strategies including solar-ready approaches Select design or design/build firm Design Design Schematic design Design development: develop preliminary designs for all building systems Construction documents Request for proposals (RFP): develop bid package and select firm for construction Schematic design: develop schematic design incorporating RE technology and strategy Design development: refine RE system model, determine impacts of RE system on the building [e.g., structural; heating, ventilating, and air conditioning (HVAC); or electrical interface], and cost Construction documents: RE technology- related drawings and specs RFP: develop bid package and select firm for construction Construction Construction Review and oversight As-built drawings Commissioning: testing and O&M training Review and oversight: RE experts to review RE-specific aspects throughout process; refine impacts of any changes from design As-built drawings Commissioning: RE-system–specific commissioning/acceptance testing and O&M training Operation and Maintenance Operation and Maintenance Ongoing O&M • • • • • • • • • • • • • Ongoing O&M specific to RE systems Monitoring of RE system performance • • • • • • • • • • • • • • • • Table 3-1. Renewable energy-related considerations in project development process.

28 Renewable Energy Guide for Highway Maintenance Facilities • Energy performance, including: – Energy output levels. – Offsets to utility consumption, either peak load or overall reduction. • Environmental performance, including: – Carbon offsets. – Aesthetic impacts. – Building rating such as LEED, Green Globes, Energy Star, and LBI (Living Building Institute). • Economic performance, including: – Definition of budget for RE system. – Required return on investment or financial/economic figure of merit. – Reduction in operating costs. – Maintenance budget/major equipment replacement timetable and so forth. Assess Renewable Energy Resources Renewable energy resources vary by location and climate. When incorporating renewable energy into a project, a thorough analysis of available renewable energy resources is critical to its success. There are a variety of resources and tools available to provide initial and detailed information on site-specific renewable energy resources. These include averaged historical weather data such as typical meteorological year (TMY), which averages long-term collected weather data to produce the typically expected weather for a monitored location. Many energy performance modeling software programs use TMY data, and software has been developed that combines data from multiple reporting sites to generate weather data for almost all locations in the United States. The latest TMY data have been collected from 1,020 sites in the United States and its territories from 1991 through 2005 and are known as TMY3 data.18 TMY3 includes 62 fields of data, includ- ing solar irradiance, luminance, sky cover, dry-bulb temperature, dew-point temperature, relative humidity, wind direction, and wind speed, as well as other information useful in predicting renew- able energy system performance. Due to microclimate conditions, on-site monitoring may also be of value in some locations. To identify renewable energy resources not related to weather and climate will require inves- tigation into other areas. Examples of technologies using non-weather resources are biomass, hydroelectric, alternate fuels, and microgrids. Though still site-specific, resource availability will require investigation into feedstock, infrastructure, and other elements specific to the local area. Identify Available Renewable Energy Technologies Appropriate renewable energy technologies should be apparent for a proposed project after consideration of the available renewable energy resources and analysis of the project program and renewable energy system goals. Available renewable energy technologies are discussed in Chapter 5, which includes additional information on appropriate applications. Identify Loads Buildings require energy to meet a variety of loads. Some typical building loads that drive heating and cooling needs are: • Heat loss, including: – Heat loss through the building envelope (floor, walls, windows, doors, and roofs). – Heat loss from ventilation and infiltration. 18Wilcox and Marion, 2008. User’s Manual for TMY3 Data Sets, Technical Report NREL/TP-581-43156, National Renewable Energy Laboratory, Golden, CO. http://rredc.nrel.gov/solar/old_data/nsrdb/1991-2005/tmy3/.

General Project Considerations 29 • Heat gains, including: – Solar gain through windows. – Heat generated by artificial lighting and office and other equipment. – Heat generated by building occupants. – Heat gain due to ventilation and infiltration. • Other loads, such as water heating and process equipment requirements. To size building heating, ventilating, and air conditioning (HVAC) equipment and provide adequate electrical capacity, it is necessary to quantify these loads. For initial analysis, information from CBECS is available for vehicle repair and service buildings. Using CBECS data for typical energy use per square foot and the electrical percentage of building energy can provide initial load estimates for building and electrical loads. CBECS information is an average of existing buildings. A new project should be able to attain energy consumption levels considerably below CBECS levels by incorporating current building technologies and energy efficiency strategies. It is very important when incorporating energy efficiency measures to emphasize that mechanical systems are “right-sized” by engineering consultants. Designs with excess capacity run at lower efficiencies and can neutralize energy efficiency efforts. As building systems and envelope construction are developed in more detail, sophisticated energy modeling can be performed to refine the loads and design systems to meet the loads for the project. Modeling may be necessary to meet the requirements of building rating systems and the applicable building code. Most codes use the climate zones defined by ASHRAE (see Figure 2-2). Identify Agency and Policy Requirements Various other requirements may have an impact on the incorporation of renewable energy on a highway maintenance facility. These can include requirements of various governmental agen- cies, local utilities, and building certification entities (if a building certification is sought for the project). Examples of governmental agency requirements and impacts are: • Building codes, including energy codes that specify minimum building performance; • Solar access legislation; • Zoning restrictions, which may limit size, location, and visibility of renewable energy systems; • Grid connection rules and regulations; • Renewable portfolio standards (RPSs) and renewable energy set-asides that could affect financial performance; and • Financial incentives such as grants, loans, and tax incentives. Examples of requirements for renewable energy systems imposed by utilities are: • Grid connection requirements, • Maximum capacity of renewable energy systems, and • Net metering requirements. Net metering is a particularly important consideration because it results in electricity generated by the renewable energy system being valued at the retail electricity rate. The amount of electricity generated by the renewable energy system is credited against the electricity purchased from the utility, and the monthly electric bill is based on the net electricity purchased. If the net annual amount is in excess of the facility’s needs (the amount generated on-site exceeds the facility use), the utility may provide payment for this surplus. Net metering programs often have restrictions based on renewable energy system capacity (e.g., maximum rated output in kW). Figure 3-3 shows a map of state net metering policies, and Figure 3-4 shows a map of interconnection capacity provisions. States that are not color coded have no state policies with regard to net metering or interconnection. The numbers are the renewable system capacity limits in kW.

30 Renewable Energy Guide for Highway Maintenance Facilities Building rating systems (such as the LEED rating system) can also affect not only the renewable energy system but many other elements of the building design. Rating system requirements should be a part of the building program and may include: • Modeling of energy performance of the building envelope and systems, • Daylighting and associated modeling, • Integrated commissioning for the project, and • Adjustments to the size of renewable energy systems. Figure 3-3. Net metering policies. Source: Database of State Incentives for Renewables & Efficiency, www.dsireusa.org. Figure 3-4. Electric interconnection policies for renewable electric energy systems. Source: Database of State Incentives for Renewables & Efficiency, www.dsireusa.org.

General Project Considerations 31 Because of the various jurisdictions where a project may be located, it is important to research, review, and incorporate the requirements of the governmental jurisdictions and utilities with authority over the project. With the rise in the number of renewable energy installations, there are an increasing number of qualified consultants available to assist in meeting agency and policy requirements. Select Renewable Energy Technology Based on the analysis of available renewable energy resources, the expected building energy loads, the available renewable energy technologies described in this guide, and code and policy impacts, select appropriate renewable energy technologies for the project. The selec- tion process should integrate the program goals and design of the building with the renewable energy system goals to optimize performance. Additional modeling of the renewable energy system selected can be used to predict system performance, refine the sizing and performance of the building systems, and further integrate the building and the renewable energy system. Consider Solar-Ready Design Features Even if the initial analyses indicate that a solar energy system is not cost-effective, it may be beneficial to at least consider incorporating features that will facilitate the addition of solar sys- tems at a later time. These include provisions for building or land areas that are unshaded to pro- vide solar access, structural modifications to account for the installation of solar panels on the building, providing space in mechanical rooms for future equipment (e.g., solar storage tanks), chases to accommodate piping or wiring for future solar systems, and room for additional electrical equipment/panels. By making these investments in the original design, the facility will be able to more easily and cost-effectively install solar systems at a future date. Guidelines for solar-ready buildings have been developed by NREL (Solar Ready Buildings Planning Guide: http://www.nrel.gov/docs/fy10osti/46078.pdf) and states (e.g., Minnesota’s Solar Ready Build- ings Design Guidelines: http://mn.gov/commerce/energy/images/Solar-Ready-Building.pdf). 3.4.2 Design Phase 3.4.2.1 Preliminary Design New Construction, Renovation, and Reuse. The work in this phase involves the preparation of preliminary design documents based on the building program and renewable energy goals. The preliminary design includes definition of the project scope, building form, schematic floor plans, exterior elevations, massing studies, and other documents necessary to illustrate the extent and organization of the project and to incorporate the renewable energy system into the design. Conceptual modeling of building and renewable energy system performance should be performed to verify the concept. In this phase, a preliminary budget based on unit costs per square foot will also be established. If the project includes addition of renewable energy to an existing building, the feasibility of adding to the structural, electrical, and other capacities of existing systems affected by the project should be verified. For integrated design projects, in addition to these activities, initial budget, constructability, and schedule information would be provided by the contractors, initial life-cycle cost data produced, system concepts reviewed by the commissioning agents, and design verification completed by the designers. The use of a building information model (BIM) is typical in integrated design, with the model available to all parties. As the project develops, each entity uses the model and adds additional detail, resulting in less conflict between trades. Stand-Alone Renewable Energy Projects. For projects not associated with an existing structure (such as a wind turbine or a ground-mounted solar PV array), the preliminary design process is relatively simple once renewable energy resources are identified, renewable energy goals defined, loads to be met determined, code and other limitations defined, and a renewable energy technology

32 Renewable Energy Guide for Highway Maintenance Facilities identified and selected. Preliminary design documents of the system are prepared to indicate the extent and configuration of the renewable energy system, along with initial economic modeling to identify the economic feasibility of the project. At this phase, interconnection requirements should also be confirmed. 3.4.2.2 Design Development New Construction, Renovation, and Reuse. After review and approval by the owner, design development documents are prepared to finalize all design decisions and provide further detail of the architectural solution. The structural, mechanical, electrical, and renewable energy sys- tems and materials are defined and integrated into the design solution, and quality levels are established through the development of details and outline specifications. Renewable energy systems are modeled with their impact incorporated into other building systems and their effec- tiveness and performance confirmed. An independent evaluation of the candidate systems can be undertaken. Project costs are refined from the preliminary budget to reflect additional infor- mation and detail. For projects incorporating the integrated project delivery approach, this phase would be more detailed than a traditionally delivered project. The goal of this phase under integrated design is to have all building systems fully defined, coordinated, and validated in a complete BIM. The BIM can also be used to model envelope performance, daylighting, and system energy use, resulting in efficient and accurately designed systems. Costs are detailed and constructability and schedule established, and the project is ready to enter a somewhat shorter final documentation phase. Each stakeholder provides necessary input to coordinate all the work of the project. Stand-Alone Renewable Energy Projects. For stand-alone projects, the details of structural, electrical, and other systems would be established in this phase. All design decisions would be made, energy and financial performance modeling completed, costs refined, and outline specifi- cations completed with the project ready to enter the documentation phase. 3.4.2.3 Documentation All Project Types. This phase includes the preparation of technical documents describing and detailing requirements for the construction of the project. Minor design decisions can occur during this phase as additional detailing is completed. Documents include drawings and specifications, a detailed budget, and bidding information. Technical documents produced during this phase will be used to obtain building permit approval and for obtaining bids from contractors. Variations for Integrated Design. Because the integrated design process brings many of the contractors and agency review activities into the project early, building permits and bidding may be further along at this phase. In most projects, prices for major portions of the work have been committed to by the contractors at this phase. The goal of this phase under integrated design is to determine and document how the design intent will be implemented and not to change or develop it. Because of the participation of the construction trades and suppliers, the traditional shop drawing process is also part of this phase, using the BIM model to streamline the process. 3.4.2.4 Bidding/Negotiation Traditional Project Delivery Methods. Activities of this phase are to solicit and obtain bids from contractors, review the bids submitted, and award contracts. There is some potential for value engineering at this phase that could change the scope of the work. When value engineering occurs, care must be taken to coordinate the work of different entities affected by any changes. Savings from one area of work can result in additional costs in another area if care isn’t taken to manage value engineering. The traditional bidding process usually takes 4 to 5 weeks, review of bids may take 2 weeks, and award of contracts can take up to 60 days, depending on the entity.

General Project Considerations 33 Integrated Design Project Delivery. As the contractors and suppliers have been involved in the integrated design process by providing pricing during the design and documentation phase, this process is much shorter than a traditionally delivered project. 3.4.3 Construction Phase 3.4.3.1 Construction Traditional Project Delivery Methods. The responsibilities of the design professionals in a traditionally delivered project include review of shop drawings and other submittals, obser- vation of construction progress, and review and approval of payment applications by the contractors. In many instances where buildings incorporate complicated systems, a further activity of the design professional is to monitor changes to the work. The responsibilities of the contractors during this phase are to construct the project as documented and deliver the project to the owner as scheduled. Depending on the responsibilities assigned during the documentation phase, testing and inspections may be performed by the contractor with results reported to the design professionals and owner, or the owner may contract separately for these services. Integrated Design Project Delivery. As the level of detail and integration of contractors and suppliers occurs early in integrated design, the construction phase is limited to quality control and cost monitoring. 3.4.3.2 Commissioning Traditional Project Delivery Methods. One area of concern in traditional project delivery is commissioning. Commissioning is a process involving quality control steps at each phase of the project implementation process to ensure that the building performs as intended. This includes the development of a commissioning plan and designation of a commissioning agent, along with specific system operational tests and documentation requirements. Building rating certifications often require that commissioning be integrated into the project. If the rating system requirements are not defined early in the project, it may be difficult to incorporate acceptable commissioning activities later. Provided that commissioning has been incorporated into the project, testing and inspections are required during construction and at the completion of construction activities. Training of the owner’s personnel in the operation of systems is also usually a requirement of the commissioning process. Integrated Design Project Delivery. With commissioning agents involved since the inception of the project, commissioning activities continue throughout the construction phase and upon completion of the work. 3.4.3.3 Verification and Acceptance Traditional Project Delivery Methods. Upon completion of construction, delivery of as-built drawings, delivery of operating and maintenance information, completion of punch list, acceptance of commissioning, and testing of all building systems, the project is determined to be complete. Final inspections are made by building code officials and other agencies, and a certificate of occupancy issued. Upon satisfactory verification of performance and approval by authorities having jurisdiction, the owner accepts the building or system. Integrated Design Project Delivery. Similar to traditional methods, under integrated design the same activities will occur. In addition, the as-built BIM model can be made available to the owner and used in operation and maintenance of the project. Renewable Energy System. For grid-tied systems, the utility must also accept the system. Coordination with the utility is essential to prevent the operation of the renewable energy

34 Renewable Energy Guide for Highway Maintenance Facilities system from being delayed beyond the occupancy date for the project. Where RECs are available, certification of system output is required before the RECs can be sold. 3.4.4 Operation and Maintenance Phase Traditional Project Delivery Methods. Owner takes over operation and maintenance of the project. Contractors are responsible for warranty support and, depending on contract requirements, a 1-year inspection of the project. Integrated Design Project Delivery. As with the previous item, owner takes over operation and maintenance. The as-built BIM model can be used by the owner in management of building maintenance and operation, including energy performance modeling and other operational systems. 3.4.5 Performance Monitoring Traditional Project Delivery Methods. Depending on the building, there may be provisions for monitoring of building systems, but primarily from an operational status point of view. Monitoring of energy performance may be included for larger buildings. Integrated Design Project Delivery. This is similar to traditional delivery methods. However, provisions for monitoring of renewable energy systems would be incorporated. These could include displays that allow building occupants or visitors to view the performance, which would serve as an educational feature.

35 4.1 Introduction State governments are increasingly aware of the environmental and economic benefits of devel- oping renewable energy sources, including reducing carbon emissions, lowering state energy bills, and creating new high-quality jobs. But while the rewards of renewable energy projects can be great, the up-front capital costs can also be high. A wide variety of innovative financing options and incentives are available that help make the development of renewable energy projects feasible. This section discusses some of these available options and the advantages and disadvantages of each funding source. 4.2 Direct Funding Conceptually, the simplest way for a transportation agency to pay for a renewable energy system is for the agency to pay for it directly using its appropriated funds. The agency purchases the system outright, and it owns both the system and its energy production. As the owner of the system, the agency will be responsible for ensuring the system’s operations and maintenance after it is built. While using direct funding obviates the need for paying financing costs, it is often very difficult to secure, given budget pressures and competing priorities for agency funds. In addition, public entities are often not eligible to reap the benefits of certain tax incentives that are only available to private developers. (See Table 4-1 for advantages and disadvantages of direct fund- ing.) For these reasons, transportation agencies may want to use some form of financing to pay for renewable energy systems. 4.3 Bonds States have increasingly issued bonds to pay for renewable energy projects over the past decade.19 States, municipalities, and other government agencies sell bonds to investors and then repay them (with interest) by a specific maturity date. Many state-issued bonds are tax exempt, meaning that interest payments from them are not counted as taxable income by the federal government. State bonds can therefore be appealing to investors despite relatively low interest rates. The most basic type of bond used is the general obligation (GO) bond. These bonds, which are used to finance large infra- structure projects, are backed by the full faith and credit of the state government. This means that the state pledges to use its taxation power to repay bondholders. Because investors treat GO bonds as very safe investments, interest rates can be relatively low, reducing the borrowing costs to the state. State agencies or authorities can also issue revenue bonds to build infrastructure projects. These bonds are backed by the revenue created by the project they pay for rather than by the C H A P T E R 4 Project Financing 19Devashree, 2011, p. 7.

36 Renewable Energy Guide for Highway Maintenance Facilities state’s taxing power. It is now possible to issue energy bonds, a type of revenue bond in which the money for repayment comes from the revenue generated or saved by the energy project that it finances. These bonds do not add to a government’s general debt or tax burden. However, since future energy savings are a relatively uncertain revenue stream compared to the certainty of taxes, it can be more difficult to bring energy bonds to market. There are not many examples of states using energy bonds to fund renewable energy projects.20 Federal tax subsidy bonds are another popular form of bond used to pay for renewable energy projects. Generally speaking, borrowers pay 0% interest on tax subsidy bonds, while bond holders receive federal tax credits in lieu of traditional interest payments. Two relevant tax subsidy bonds that have been used for renewable energy projects in recent years are known as clean renewable energy bonds (CREBs) and qualified energy conservation bonds (QECBs). The federal government is not currently accepting applications for new CREBs bond volume, but QECBs may be available if a proposed renewable energy project fits the official definition of a “qualified energy conservation project.” The availability of federal bond programs can change year by year, so agencies should investigate whether they are a possible source of funding when embarking on a renewable energy project.21 The California Department of Transportation (Caltrans) has successfully used CREBs to install photovoltaic systems at 70 of its facilities throughout the state, including 46 maintenance facilities (see Case Studies, 22.7). See Table 4-2 for advantages and disadvantages of bond funding. 4.4 Public Benefit Fund States or public utility commissions are able to establish public benefit funds (PBFs) in order to raise money for renewable energy projects and incentives. Money for the PBF is collected through a small surcharge (system benefits charge) on customers’ electric utility bills. The money is then disbursed by states, utilities, or third parties in the form of grants, loans, rebates, incentives, or even free assistance. Typically the beneficiary of a PBF must be a utility ratepayer. If a state agency is the customer of a utility that collects money for a PBF, it is eligible to use the fund to finance renewable energy projects. In many states, PBFs are the primary source of renewable energy incentives.22 An estimated 18 states plus the District of Columbia and Puerto Rico have PBFs for renewable energy, 20Cory et al., 2008, p. 12. 21Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/incentives/incentive.cfm?Incentive_ Code=US45F&re=1&ee=1; Saha, 2011, pp. 9–10. 22Cory, 2008, p. 9. Agency Funding Advantages Disadvantages Conceptually easy to understand and monitor. Difficulty obtaining appropriations for large up-front costs. Zero financing costs. Not eligible for certain tax incentives. Agency owns system outright. Agency responsible for long-term O&M. Table 4-1. Agency funding—advantages and disadvantages. Bonds Advantages Disadvantages Allows agency to purchase system outright without need for appropriations. Not eligible for certain tax incentives. Low borrowing costs, yet still appealing to investors. Agency responsible for long-term O&M. Energy bonds do not add to general debt burden. Energy bonds are less appealing to investors. Federal tax subsidy bonds generally have 0% interest rates. The availability of tax subsidy bonds is limited; CREBs are not currently available. Table 4-2. Bonds—advantages and disadvantages.

Project Financing 37 mostly in the Northeast, the Midwest, and on the West Coast.23 See Table 4-3 for advantages and disadvantages of public benefit funds. 4.5 Revolving Loan Fund A revolving loan fund (RLF) is a form of financing in which a state (rather than private investors) loans money to public or private entities for clean energy projects, with the principal and interest payments being recycled back into the RLF to fund other projects. RLFs typically target small projects (costing up to $10,000), but they can also be used for much larger projects.24 See Table 4-4 for advantages and disadvantages of revolving loan funds. 4.6 Other State Funding Options A number of other options exist to fund renewable energy projects without seeking private- sector financing. Besides a variety of grant and loan programs, some of these financing options are: • Pooled bond and pooled lease-purchase financing, in which the state aggregates multiple small clean energy projects to finance them more effectively; • Greenhouse gas allowance auctions, which can raise revenue for direct funding of renewable energy projects; and • State treasurer investments.25 4.7 Third-Party Ownership 4.7.1 Power Purchasing Agreements Over the past decade, power purchasing agreements (PPAs) have become a very popular way to use third-party developers to finance a wide variety of renewable energy projects, especially solar photovoltaic systems on public buildings.26 In a PPA, a renewable energy developer agrees to 23Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/solar/solarpolicyguide/?id=22. 24Saha, 2011, p. 20. 25Saha, 2011, pp. 13, 24. 26Cory, 2008, p. 23. Public Benefit Funds Advantages Disadvantages Same as for other directly funded projects: agency owns system outright, easy to understand, and low or zero financing costs. Same as for other directly funded projects: not eligible for certain tax incentives, and agency responsible for long-term O&M. Funds raised consistently through use of a fee on all customers’ utility bills. No two programs are the same; the PBF may not fund the type of project the agency is interested in pursuing. States can be creative in how they disburse funds. Not available in all states. Table 4-3. Public benefit funds—advantages and disadvantages. Revolving Loan Funds Advantages Disadvantages Relatively simple to set up and understand. Same as for other directly funded projects: not eligible for certain tax incentives, and agency responsible for long-term O&M. Often effective for projects costing up to $10,000. Funds may not be sufficient for larger projects; does not leverage private-sector funding. Not available in all states. Table 4-4. Revolving loan funds—advantages and disadvantages.

38 Renewable Energy Guide for Highway Maintenance Facilities build a generation system on a customer’s site, while the customer signs a long-term (10 to 30 year) agreement to purchase the electricity produced.27 The PPA is structured to provide energy at a rate that meets the requirements of the customer (e.g., it provides savings relative to utility-purchased electricity over the term of the agreement). By signing a PPA, the customer is able to transfer all capital costs to the developer, thereby spreading out the costs of building a renewable energy system over many years. The customer is also able to avoid being responsible for logistics, including maintenance and operations, which are handled by the developer for the life of the contract. The developer, on the other hand, obtains a steady stream of income from the customer and is able to acquire financial incentives (such as tax credits and accelerated depreciation) that are only available to private entities. PPAs are therefore often mutually beneficial for customers and producers. Depending on the terms of the contract, at the end of the PPA term the customer who hosts the equipment may be able to purchase the generating equipment outright, renew the agreement with similar or different terms, or remove the equipment. It is also possible for the agreement to allow the customer to purchase the system before the PPA agreement is over, though typically not until at least 6 years have passed, allowing the third-party developer to exhaust all available investment tax credits and accelerated depreciation benefits.28 See Table 4-5 for advantages and disadvantages of PPAs. Third-party PPAs are currently legal in over 20 states, the District of Columbia, and Puerto Rico for solar photovoltaic projects, but in some states their use is disallowed or restricted by law (see Figure 4-1). The Denver, CO, Public Works Central Platte’s 102-kW photovoltaic system is a good example of the use of a PPA to help finance a renewable energy project (see Case Studies, 22.5). 4.7.2 Partnership-Flip and Sale-Leaseback Models It is now common for third-party developers of renewable energy systems to form partner- ships with their institutional investors that affect ownership. These partnership agreements affect elements of the PPA between the state agency and the developer. It is therefore important for agencies to understand two of the most common of these advanced ownership models: the partnership-flip and sale-leaseback models. 4.7.3 Partnership-Flip Model In the partnership-flip model, the developer and an institutional investor form a partnership (typically a limited liability corporation or special purpose entity) that owns the renewable energy project. It is this partnership that enters into a PPA with the public-sector agency/host of the renewable energy system. 27McGervey and Stinton, 2011, p. 34. 28McGervey and Stinton, 2011, p. 47. Power Purchasing Agreement Advantages Disadvantages Low/no up-front capital costs for the agency. Significant transaction costs. Typically include known, fixed energy costs over a long period of time. Penalties for terminating the contract. Agency not responsible for O&M. Site access issues are complex. Developer is eligible for tax incentives, potentially reducing cost of energy. Management and ownership structures can be complex. Increasingly common and well understood. Not legally available in all states and jurisdictions. Table 4-5. Power purchasing agreements—advantages and disadvantages.

Project Financing 39 Initially, the investor has a disproportionate ownership stake in the partnership (nearly 100%) and receives most of the tax incentives and other income derived from the project. Once the investor has achieved a predetermined level of return on its investment (known as the flip point), the investor turns over (or flips) its majority stake in the partnership to the developer. After the flip point, the developer typically has the option to completely buy out the investor’s stake in the partnership. Likewise, it is possible to arrange the PPA such that the state agency has the option to purchase the system and take full ownership either at the flip point or at predetermined times throughout the PPA later on. 4.7.4 Sale-Leaseback Model In the sale-leaseback model, an institutional investor buys the renewable energy system after the developer has installed it. The investor then leases the system back to the third-party PPA developer for approximately the length of the PPA. This allows the investor to monetize various tax credits. These tax savings are shared with the developer in the form of reduced rents for leasing the system. The developer typically has the option to buy back the system at the end of the lease at fair market value. Likewise, it is possible to arrange the PPA such that the public entity has the option to purchase the system and take full ownership either at the sell-back point or at predetermined times throughout the PPA later on.29 4.8 Energy Savings Performance Contract Under an energy savings performance contract (ESPC), the agency contracts with an energy services company (ESCO) to implement an energy efficiency or renewable energy project for one of its facilities. Implementing an ESPC requires no up-front costs for the governing agency. Source: Database of State Incentives for Renewables & Efficiency, www.dsireusa.org. Figure 4-1. State solar photovoltaics power purchase agreement policies. 29Cory, 2008, pp. 28–30, and McGervey and Stinton, 2011, p. 35.

40 Renewable Energy Guide for Highway Maintenance Facilities Rather, the ESCO incurs all costs of implementing various energy projects and then receives payment based on the resulting energy savings; the two parties negotiate who maintains the energy projects over the term of the agreement. ESPCs have a long history of being used in the federal sector, primarily for energy efficiency projects.30 They have been used to fund renewable energy projects, although mainly in conjunction with energy efficiency projects. This is because the economics of a stand-alone renewable energy project may not be attractive enough under the ESPC structure. However, when bundled with energy efficiency measures, the portfolio may become economically attractive. See Table 4-6 for advantages and disadvantages of ESPCs. 4.9 Renewable Energy Certificates In addition to electricity, renewable energy projects can also create a tradable commodity known as a renewable energy certificate. RECs represent the non-power benefits of a renewable power project to the environment and society; typically each REC represents 1 megawatt-hour (MWh) of renewable energy production. RECs are bought and sold, either bundled with or separate from the electricity that is generated, at the same time. Utilities, businesses, and others buy RECs both to support renewable energy and to meet any obligations they may have under their state’s renewable energy portfolio standard or other alternative energy obligation. An RPS is a requirement that utility power generators derive a specified amount or percentage of their total electricity sales (MWh) or capacity (MW) from renewable energy sources by a specified year. Currently, 29 states and the District of Columbia have an RPS in place, and another eight have voluntary goals (see Figure 4-2).31 An RPS may have further requirements that specify the shares of the total requirement that must come from various types of renewable energy (e.g., a carve out for solar or wind). RECs that are associated with solar power tend to be worth more than other RECs, and so they are specifically labeled as solar renewable energy certificates (SRECs). Agencies planning to build a renewable energy project should be sure to consider what will happen to the RECs/SRECs associated with the generation of clean energy. Selling RECs is a good way for an agency to finance the construction of a renewable energy project. SRECs can even account for as much as 40% to 80% of the total revenue stream of a solar project in some states.32 However, once sold, the RECs are no longer available for the agency to use for compliance with its own renewable energy generation requirements. Agencies should consider whether they want to keep or sell the RECs produced by their renewable energy projects and ensure that whatever contract they sign with third-party developers and investors clearly states which entity owns all RECs produced by the project. Energy Savings Performance Contracts Advantages Disadvantages Low/no up-front capital costs for the agency, and payments do not exceed savings. Primarily used for energy efficiency and conservation projects. ESCOs provide technical resources that the agency otherwise would not be able to access. Developing and implementing an ESPC can be a demanding task for an agency. Agency may have discretion to allow ESCO to own energy assets eligible for certain tax incentives. ESCOs traditionally do not own assets and are therefore not eligible for certain tax incentives. Table 4-6. Energy savings performance contracts—advantages and disadvantages. 30McGervey and Stinton, 2011, p. 51. 31Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/rpsdata/index.cfm. 32Cory, 2008, p. 7.

Project Financing 41 4.10 Renewable Energy Incentives As mentioned previously, there are a variety of federal and state incentives that can be leveraged by third-party investors to lower the cost of renewable energy projects. 4.10.1 Business Energy Investment Tax Credit The business energy investment tax credit (ITC) is a federal corporate tax credit available under 26 USC § 48. The credit is worth 30% of up-front expenditures for solar, fuel cell, and small wind projects; for some other technologies, such as geothermal, it is worth 10% of expenditures. The credit is available for eligible systems that are placed into service by December 31, 2016. In general, the recipient of the tax break must be either the original builder or user of the renewable energy system. Though the ITC can potentially save a lot of money, the rules associated with it are complex. Applicable sectors for the ITC are commercial, industrial, utility, and agricultural, so a state agency would require a PPA or other arrangement with a private third-party investor in order to take advantage of it.33 4.10.2 Modified Accelerated Cost Recovery System and Bonus Depreciation Depreciation is the normal wear and tear that makes property less valuable over time. The federal government allows businesses to claim income tax deductions for depreciation. Under the Modified Accelerated Cost Recovery System (MACRS), the federal government establishes how long it takes for a type of asset to depreciate. The shorter the time it takes, the more quickly investors can recoup money through the use of depreciation tax deductions. Source: Database of State Incentives for Renewables & Efficiency, www.dsireusa.org. Figure 4-2. State renewable portfolio standards. 33Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/incentives/incentive.cfm?Incentive_ Code=US02F.

42 Renewable Energy Guide for Highway Maintenance Facilities The federal government currently classifies a variety of renewable energy systems, including those using solar, geothermal, and small wind technologies, as 5-year property. This short time period allows investors to recoup the cost of the renewable energy project more quickly than would otherwise be possible. In addition, recent legislation allows bonus depreciation, meaning investors can claim an even larger tax deduction in the first year of the life of a renewable energy project. As with the ITC, MACRS and bonus depreciation are only available as tax credits for the private sector.34 4.10.3 Incentive Programs The federal government, states, localities, utilities, and other third parties offer incentives to encourage renewable energy projects. These include grant programs, loans, net metering, tax incentives, and RPSs. Available programs and policies vary widely by state. Many state energy offices are good sources of information regarding which incentives are available for various types of renewable energy projects. North Carolina State University’s Database of State Incentives for Renewables & Efficiency (DSIRE) also maintains a wealth of information about various incentives and contains maps and other charts showing where they are available (http://www.dsireusa.org/). Figure 4-3 is a map from DSIRE indicating which states have rebate programs for renewable energy technologies. Source: Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/. Figure 4-3. Rebate programs for renewable energy technologies. 34Database of State Incentives for Renewables & Efficiency, http://www.dsireusa.org/incentives/incentive.cfm?Incentive_ Code=US06F.

43 5.1 Renewable Energy Technology and Strategy Applicability Based on Region and Site Considerations Table 5-1 provides summary information about the various renewable energy technologies covered in this guide in terms of applicability considerations. Also included in the table are the chapter numbers for the technology information in Part III and case studies (and section numbers) in Part IV that are associated with the technology. The table, along with additional information provided in this chapter, is intended to help the user navigate to their technologies of interest. The factors identified in the table are: • Regional considerations. Applicability or effectiveness of the technology based on the geo- graphical region. • Site-specific considerations. Properties of the site, such as the presence of vegetation, structures that could provide unwanted shading, and other factors that could affect the ability to use the technology at the site. • Building-specific considerations. Building-design–related factors. • Energy contribution. Typical energy outputs or percent of building energy needs met. • Installation costs. Typical technology/design strategy combined equipment and installation costs. • Economics. Payback periods. • Reliability. Reliability or operation and maintenance considerations. It should be noted that the ability to generalize renewable energy technology applicability by geographic region, particularly in terms of renewable energy resources and key climate drivers, varies considerably by technology: • Temperature and humidity. Temperature and humidity are major factors in building heating and cooling requirements. For skin-dominated buildings like most maintenance facilities, heat gains and losses through the building envelope (walls, roofs, windows) are substantially responsible for heating and cooling loads. In addition, the fresh air requirements for servicing vehicles contributes significantly to overall heating and cooling loads. As a consequence, the temperature and humidity are influential in decisions regarding building envelope selection, the degree to which fresh air must be conditioned, and opportunities for various energy efficiency and passive cooling technologies and strategies. In this case, the ASHRAE climate zones, which reflect a geographic segmentation that is based on temperature and humidity/moisture considerations, are useful for evaluating these technologies and strategies from a regional applicability perspective (see Figure 2-2). • Solar resource. The amount of sunshine is another key factor in driving building heating and cooling requirements. This is of particular consequence for solar energy technologies— passive solar, active solar, photovoltaics, and concentrating solar power. However, regions based on gradations in solar resource do not necessarily correspond with the ASHRAE climate zones C H A P T E R 5 Applicability Guide

Regional Considerations Site-Specific Considerations Building-Specific Considerations Energy Contribution Installation Costs Economics Reliability Re Chapter # Case Study (Section #) Daylighting: The use of natural light (daylight) to illuminate a space to offset electric lighting requirements. This is accomplished through a variety of strategies that include side lighting and top lighting using windows, skylights, roof monitors, and clerestory windows to light the building perimeter or core areas. Integration with controls that dim or shut off electric lighting is an important element to ensure electricity savings. Daylighting strategies can be used in all regions effectively. Furthermore, ample daylight is available to light spaces that are not in direct sunlight. Shading. Trade-off between glazed area (e.g., window-to-wall ratios) and window glazing type to balance visible light transmittance with solar heat gains and losses. Reduces lighting requirements by 10%–30%. Increases building costs by 2%–3%. Payback periods are under 10 years. Reliable, but the lighting controls must be maintained/sensor calibrated. Chapter 7 Case Study: Central Platte, CO (22.5) TRANSPO, IN (22.6) Passive Solar Heating: The use of the building elements to capture and store solar-derived heat to offset conventional heating energy requirements. Passive solar designs involve orienting the building to maximize winter solar heat gain through windows or roof apertures, increasing the amount of south-facing window area to increase solar gains, and using the mass of the building for heat storage. Passive solar heating can be used in all climates but is more effective in regions that have greater winter sunshine. Winter shading of the south- facing windows or glazed areas by vegetation or other structures must be avoided. Depending on the type of design, there are trade-offs in terms of building aspect ratio (length to width), orientation, choice of window glazing, and the need for solar heat gain control during non- heating seasons. Can provide 10%–30% of heating requirements. Increases building costs by 0%–4%. Payback periods are under 10 years. Reliable and low maintenance. Chapter 8 Case Study: Central Platte, CO (22.5) Most effective in perimeter spaces Natural or Passive Cooling: The use of building elements to reduce unwanted solar heat gains and natural ventilation to reduce cooling requirements. Solar heat gain avoidance strategies are effective in all regions, while natural ventilation is most effective in regions with moderate humidity. Vegetation, wind patterns that can affect natural ventilation. The use of shading devices to reduce heat gains, placement of windows to enable cross-ventilation. Can reduce cooling requirements by 10%. Increase building costs by 1%-3%. Payback periods are under 10 years. Reliable. The only issue is to ensure that occupant interaction does not reduce effectiveness. Chapter 9 Active Solar Heating: These systems use solar collectors to convert solar energy to thermal energy, which is transported by pumps or fans to storage tanks or directly to the space. Active solar water heating systems are used to preheat water for domestic or process uses, while active solar space heating or ventilation preheat systems are used to help meet space heating or ventilation air heating needs. Active solar systems can be used in all climates but provide greater output in cold, sunny regions. For water and space heating systems that use liquid as the heat transfer fluid in Requires area that is generally unshaded. There needs to be adequate area for the collectors, and if roof mounted, structural loads imposed by the collectors must be considered. Can meet 30% or more of water heating requirements and 20%–40% of space heating or ventilation air heating needs. Solar water heater output ranges from 125 kBtu/ft2 to 250 Typical solar domestic hot water systems cost $100– $150/ft2 of collector, while space heating systems are $75– $100/ft2 of collector. Transpired solar collectors for Without financial incentives, systems often have paybacks of 20 years or more, assuming natural gas is the fuel saved. Reliable operation requires some additional maintenance. For transpired solar collector ventilation heating systems, there is little additional maintenance. Life is 20 years. Chapter 10 Case Study: St. Clair, MO (22.1) Coney Island, NY (22.4) Fort Drum, NY (22.2) Plattsburgh, NY (22.3) Table 5-1. Overview of renewable technology options and applicability considerations.

Regional Considerations Site-Specific Considerations Building-Specific Considerations Energy Contribution Installation Costs Economics Reliability Re Chapter # Case Study (Section #) the collectors, the degree of freeze protection needed can influence the type of system selected. kBtu/ft2, depending on collector and location. ventilation preheat cost $25–$35/ft2 of collector. Photovoltaics: These systems use photovoltaic modules to convert sunlight into electricity. Since the output of the modules is direct current (DC) and buildings generally require alternating current (AC) power, DC-to-AC inverters are used. Photovoltaic systems only generate power when there is sunlight, and batteries are used if electric storage capability is desired. Photovoltaic systems can be used in all climates but provide more electricity per module in sunny regions. Requires area that is unshaded. There needs to be adequate area for the PV modules, and if roof mounted, structural loads imposed by the collectors must be considered. Can provide 10–20 kWh/ ft2 of module per year depending on the PV module efficiency and location. Typical costs are $6,000/kW to $8,000/kW for systems that are 10 kW to 100 kW in capacity. Without financial incentives, systems often have paybacks of 20 years or more, depending on the price of electricity saved. Very reliable— 20-year life. Chapter 11 Case Study: Central Platte, CO (22.5) TRANSPO, IN (22.6) Kilauea, HI (22.11) Caltrans, CA (22.7) Concentrating Solar Power: These systems make use of reflectors of various types to focus the sun’s rays to achieve high temperatures in a receiver. The high temperatures are used to heat a heat transfer fluid, which is used to drive a power cycle to generate electricity. Systems require direct-beam sunlight, which makes them most effective in sunny regions, Requires area that is unshaded and very level. The systems generally require significant land area (5–10 acres per MW). It is possible to mount parabolic Can provide 15–25 kWh/ ft2 of reflector area per year depending on the system type Typical costs are $4,000 to $7,000/kW. Without financial incentives, systems have paybacks of 20 years or Requires dedicated maintenance for systems with associated costs of $0.02/kWh. Chapter 12 such as the U.S. Southwest. These are regions where the direct normal solar radiation exceeds 200 kWh/ft2/year (2150 kWh/m2/year). trough-type systems on a flat roof. The structural loads imposed by the collectors must be considered. and location. more. Wind Energy: Wind energy technologies convert wind energy into electricity through the use of wind turbine generators. The great majority of systems are of the horizontal-axis type, although there are some vertical-axis wind turbines on the market. Wind turbine generators perform most effectively if average wind speeds are 15 mph (6.7 m/s) or more. Since wind varies considerably, even over small areas, wind turbine applications are very site- specific. There must be sufficient land area for the wind turbine to provide adequate buffer between the turbine and structures. In most applications, wind turbines will be mounted on the ground, so there are no special building- specific considerations. Wind turbine output varies significantly with wind speed. Typical costs are $5,000/kW to $6,000/kW for systems that are 10 kW to 100 kW in capacity. Without financial incentives, systems have payback periods of 15– 25 years. Wind turbine generators are generally reliable. Maintenance costs are about $0.01/kWh for smaller machines. Chapter 13 Case Study: Milford, UT (22.8) Northwood, OH (22.9) Table 5-1. (Continued). (continued on next page)

Regional Considerations Site-Specific Considerations Building-Specific Considerations Energy Contribution Installation Costs Economics Reliability Re Chapter # Case Study (Section #) Geothermal Heat Pumps: Geothermal heat pumps use the heat in the ground, surface water, or groundwater as a heat source or sink for heat pump operation. Ground-source heat pumps use piping installed vertically in boreholes or horizontally in trenches. A heat transfer fluid (e.g., antifreeze mix) is pumped through the piping to transfer the heat between the ground and the heat pump indoor unit. The relatively constant and higher wintertime temperature of the ground, as opposed to the air, make geothermal heat pumps more efficient than air-source heat pumps for heating. Geothermal heat pumps can be used in all regions, but are most effective in temperate climates and where there is a requirement for heating and cooling. There must be adequate land for installing the ground loop. Furthermore, the heat transfer properties of the soil have a significant impact on the size of ground- loop field. If a pond is used, then the depth of the pond and total volume must provide sufficient capacity to act as a heat source. There are no special building arrangements, although the number of heat pump units and the distribution system within the building (water to air, water to water, or radiant slab) must be considered. The heat pump will be more cost- effective if air conditioning is also required. This is because the air- conditioning function is inherent in the heat pump. The system can meet all the building’s heating requirements. Typical savings are 30%–50% compared to air- source heat pumps. Typical costs are $4,000 to $6,000/ton of cooling capacity. Without financial incentives, systems have paybacks of 15 years or more. Generally reliable. Comparable to water-source heat pump. The main difference is the ground-loop or pond field and associated pumps. Chapter 14 Case Study: TRANSPO, IN (22.6) Elm Creek, MN (22.10) Biomass: Biomass systems use organic matter such as agricultural crops and agricultural wastes and residues, wood and wood wastes and residues, animal wastes, municipal wastes, and aquatic plants as fuel in boilers or gasifiers. The boilers are used to provide heat or to generate steam for use in electric power generation. Biomass systems are most effective in localities that are in close There are no site-specific issues except to have adequate space for storage There are no building-specific considerations other than providing space for the boilers. Biomass-fueled heating systems operate at efficiencies comparable to Installed costs range from $150,000/million Btu/h to $300,000/ Can be competitive against fuel oil and propane, but not Reliable. However, may require additional O&M staff for proper Chapter 15 proximity to a source of biomass. Otherwise, transport costs can make the biomass costs too high to compete with conventional fuels. of the biomass. Local environmental regulation (air quality rules) must be investigated. gas or oil-fired heating equipment and are sized to meet total or average heating requirements. million Btu/h capacity wood chip/pellet system depending on type, size, and configuration. generally natural gas. maintenance and operation. Hydroelectric: Small hydroelectric power systems use hydro-turbine generators to extract power from the movement of water between two different elevations. Small hydropower resources are very site-specific and can be found throughout the United States except in more arid areas. There are site environmental and permitting issues that need to be considered. There are no special building-specific considerations since the system is not part of the building. Energy contribution is a function of local resource (flow and elevation head). System costs are $3,000/kW to $7,000/kW for sizes in the 100 kW to 1 MW range. Payback periods of 10– 20 years. Very reliable. Chapter 16 Energy Storage: Energy storage can be used in conjunction with renewable energy systems to increase the amount of energy that can be collected and to enable better matching of system output and loads. Lead acid batteries are the most widely used electric energy storage for PV and wind energy systems. Battery storage can be used in any location. Adequate area must be provided. Adequate area must be available. The storage capacity is a function of economics and space. Lead acid battery costs are $140/kWh– $200/kWh. Other advanced batteries cost 3– 7 times as much. Varies depending on the application. Very reliable with proper charge control and maintenance. Chapter 17 Table 5-1. (Continued).

Applicability Guide 47 (see Figure 11-5 in comparison to the ASHRAE region map). For example, Hartford, CT, has a similar number of degree days as Denver, CO, but far less sunshine—particularly during the winter months. Therefore, the ASHRAE climate zones do not provide a good classifica- tion scheme for solar technology applicability. While the solar resource in any given location does vary somewhat from year to year, it is relatively stable over time. This makes solar maps (and the underlying data sets) useful for assessing the magnitude of the resource for a given location. • Wind resource. Wind resources are very site-specific and vary widely. Their magnitude must be well known before investing in wind energy technologies. While wind maps indicating wind speed or wind power density are useful to generally indicate wind potential—for exam- ple showing that the middle of the country and the coasts hold the greatest potential, and the Southeast, the least—they are no substitute for local knowledge of wind speeds and patterns (see Figure 13-4). This requires the use of wind measuring equipment (e.g., anemometers) installed in the most suitable areas of the site and data collection of 1 year. • Geothermal resource. In the context of this guide, the term geothermal resource refers to the use of the ground, groundwater, or surface waters as heat sources or sinks for geothermal heat pumps. Maps of ground or groundwater temperatures are useful indicators for geo- thermal potential in this context (see Figure 14-1). However, to ensure that the geothermal heat pump system makes economic sense, knowledge of the soil heat transfer properties should be known. This is accomplished by drilling a test well and undertaking certain measurements. • Biomass resource. Understanding biomass resources on a regional basis is not related directly to the site’s biomass resources but to the proximity of resources to the site. If local sources of biomass fuel are not available (e.g., within 50 miles of the facility), then the cost of the biomass fuel will likely be too high to make it economically viable. While wood-related biomass is the most widely used biomass fuel, there may be opportunities specific to the location, including proximity to a source of landfill gas, biodiesel, or other resources. For these reasons, local sources must be investigated to determine whether there is an adequate supply. • Hydroelectric resource. Small-scale hydroelectric opportunities are limited to situations where there is a stream on the grounds of the maintenance facility. This is a site-specific opportunity that requires determination of the available power through flow and other measurements. While the amount of renewable energy resources and site-specific considerations are highly important to the economics of the system, the availability of financial incentives can have equal or greater importance (refer to Section 4.10.3). NREL has examined the impact of incentives on the cost-effectiveness of solar technologies (photovoltaics, solar water heating, and space heating) for public entities. Figures 5-1 and 5-2 show the simple payback for photovoltaic systems assuming no incentives, and the use of available incentives, respectively. The results illustrate the large effect the incentives have on reducing payback periods and making PV system investments attractive. The main point is that incentives and utility rate structures should be investigated before eliminating a technology of interest from consideration. Figure 5-3 identifies the general steps in determining which renewable energy technologies or strategies to consider. This involves an initial assessment of the site, the building, and cost- effectiveness. If this assessment indicates that the technology or strategy makes sense, more detailed information and analysis could be collected for confirmation and for the next step in the project development process. Other factors that may enter into the decision include environmental benefits, importance to meeting sustainability objectives (such as obtaining LEED points), energy security, and how well the technology meets a specific need.

48 Renewable Energy Guide for Highway Maintenance Facilities Source: NREL. http://www.nrel.gov/gis/images/femp/graphic_pv3_pbnoincen.jpg. Figure 5-1. Payback for photovoltaic systems with no financial incentives. 5.2 Economic Evaluation Each organization will have its own requirements in terms of what constitutes a cost-effective or economic project and the associated evaluation method. These evaluation methods generally fall into two categories: simple payback analysis or life-cycle cost analysis. 5.2.1 Simple Payback Analysis Payback analysis uses the metric on the time period it takes for the project savings to return the amount invested. Projects that result in simple payback (SPB) periods of less than an established value are considered cost-effective. Any costs or benefits beyond the payback period are not considered. The SPB period is defined as the number of years it takes for the annual savings or income from a project to cover the investment costs in the project. The investment costs can be the installed capital costs or can include design costs, administrative costs, or other project costs. The savings can be defined as the energy operating cost savings or the net savings accounting for

Applicability Guide 49 differential annual operating and maintenance costs. In its simplest form, assuming uniform annual savings: SPB = investment cost/annual savings. 5.2.2 Life-Cycle Cost Analysis Life-cycle cost analysis (LCCA) accounts for the total costs of owning, operating, maintaining, repairing, and disposing of the system over a specified time frame or study period. The study period is often selected as the anticipated life of the system. The life-cycle cost accounts for price escalation as well as the time value of money via discounting. The analyses are typically done on a year-by-year basis to account for the timing of the expenditures and cash flows over the study period. Residual costs represent the net value of the system accounting for disposal costs or resale value (e.g., salvage value). Commonly used terms in LCCA are: • Discount rate. This is a measure of the time value or cost of money (e.g., interest rate). It is based on considerations such as borrowing costs, required returns, and other factors such as the riskiness of the project investment. Figure 5-2. Payback for photovoltaic systems with financial incentives. Source: NREL. http://www.nrel.gov/gis/images/femp/graphic_pv4_pbincen.jpg.

50 Renewable Energy Guide for Highway Maintenance Facilities • Present value or present worth (PW) factors. These are discount factors that are used to convert amounts paid or received in a given year to equivalent base year amounts accounting for the time value of money (discount rate). Different factors are used to convert annually recurring amounts and amounts that are single payments or investments in a given year. An important consideration when doing LCCA is whether general inflation is included in the discount rates or escalation rates. If the analysis includes general inflation in these rates, they are labeled as nominal rates, and the analysis is called a current dollar analysis. If the rates exclude general inflation, they are labeled as real rates, and the analysis is called constant dollar analysis. The Consumer Price Index (CPI), published by the U.S. Bureau of Labor Statistics, is an example of a general inflation rate. There are several LCCA figures of merit that can be used to gauge the cost-effectiveness of the project: • Life-cycle cost (LCC) = present value of initial investment cost + annual and non-annually recurring operation, maintenance, and repair costs + replacement costs + residual costs. • Net present value (NPV) = the difference between the discounted savings and costs over the specified evaluation period. If this is a positive value, then the project results in savings. A negative value means it loses money. • Savings to investment ratio (SIR) = present value of savings in annual and non-annually recurring operation, maintenance, and repair costs/present value of differential investment costs, replacement costs, and residual values. If the SIR is greater than 1, then the project saves money. If it is less than 1, it loses money. • Internal rate of return (IRR) = the value of the discount rate at which the NPV = 0 (discounted positive cash flows equal negative cash flows) over a specified time frame of interest. A project is considered cost-effective if the IRR exceeds a specified rate. • Levelized cost of energy (LCOE) = annualized value of the LCC/energy output or savings. This is a way of expressing the amortization of the total costs of the system over the energy Site Assessment • Resource Assessment – resource maps, latitude, micro-climate, solar access, soil properties • Locations/Available Land Area • Environmental/Safety Permitting – air quality, run-off, environmentally sensitive location Building Assessment • Existing Building – age, condition, roof areas, structures issues, type of lighting, electrical, HVAC systems • Upgrade Needs – Building envelope, electrical, mechanical systems • New Building – goals/functions, loads, occupancy, hrs of operation, etc. Economic Assessment • Technology Cost Estimate • Technology Performance Estimate • Financial Incentives Review • Energy Use by fuels and end-use • Energy Costs by fuels and end-use Is the Site Suitable? Is the Strategy Appropriate for the Building Requirements? Yes Yes Is the Strategy Cost Effective? Figure 5-3. Screening process.

Applicability Guide 51 output of the system. If the LCOE is less than the competing energy source over the study period, a project saves money. If it is higher, then it loses money. LCC and NPV are useful for determining which projects are most cost-effective (e.g., lowest LCC or largest NPV). SIR and IRR are useful for screening for whether a project is cost-effective, but do not provide information on whether the project is the lowest life-cycle cost. LCOE is useful in comparing competing energy technologies on a unit energy output basis. Good sources of information on life-cycle cost analysis are: • Walter Short, Daniel J. Packey, and Thomas Holt, A Manual for the Economic Evaluation of Energy Efficiency and Renewable Energy Technologies. National Renewable Energy Laboratory, March 1995, NREL/TP-462-5173. http://large.stanford.edu/publications/coal/references/ troughnet/market/docs/5173.pdf. • Sieglinde K. Fuller and Stephen R. Petersen, Life Cycle Costing Manual for the Federal Energy Management Program. U.S. Department of Commerce, Technology Administration, National Institute of Standards and Technology, NIST Handbook 135, 1995 Edition. http://fire.nist.gov/ bfrlpubs/build96/PDF/b96121.pdf. A good source for annually updated escalation and discount rates is: • A. S. Rushing, J. D. Kneifel, and B. C. Lippiatt, U.S. Department of Commerce, Technology Administration, National Institute of Standards and Technology, Energy Price Indices and Discount Factors for Life-Cycle Cost Analysis–2010, Annual Supplement to NIST Handbook 135 and NBS Special Publication 709, NISTIR 85-3273-25. http://www1.eere.energy.gov/ femp/pdfs/ashb10.pdf.