cvFPA I chp
kl m m A EPA COMBINED HEAT ANO
U-. . p. . POWER PARTNERSHIP
nited States
Environmental Protection
Agency
Opportunities for Combined Heat and
Power (CHP) in the Multifamily Sector
April 2019
Prepared for:
The Combined Heat and Power Partnership
U.S. Environmental Protection Agency
Prepared by:
The Cadmus Group LLC
ICF
-------
The U.S. Environmental Protection Agency (EPA) would like to acknowledge the many individuals,
including government employees, researchers, industry experts, and consultants whose efforts helped
develop this report. The following participated in interviews and shared their expertise during multiple
drafts of this report:
• Tom Bourgeois of Pace University and the U.S. Department of Energy (DOE) CHP Technical
Assistance Partnership
• Posie Constable of the New York City Energy Efficiency Corporation
• William Cristofaro of Energy Concepts
• Diana Molokotos and Sarah Florek, both of Aegis Energy Services Inc.
• Nandini Mouli of eSai LLC
• Stefen Samarripas of the American Council for an Energy-Efficient Economy
• Gita Subramony of Energy and Resource Solutions
The following provided significant assistance in the final review of this report:
• Bob Groberg (retired), formerly of the U. S. Department of Housing and Urban Development
• Julia Hustwit of the U.S. Department of Housing and Urban Development
• Dana Levy and Davetta Thacher at the New York State Energy Research and Development
Authority (NYSERDA)
• Stefen Samarripas, Ethan Rogers, and Neal Elliott of the American Council for an Energy-Efficient
Economy
This report was developed by the Climate Protection Partnerships Division in EPA's Office of
Atmospheric Programs. Neeharika Naik-Dhungel managed the overall report development. Matt Clouse,
Craig Haglund, Rebecca Hindin, and Gary McNeil provided content and editorial support.
A multidisciplinary team of energy and environmental consultants provided research, analysis, and
technical support for this project. They include: Cadmus (Victoria Kiechel and Jaime Rooke) and ICF
(Anne Hampson, David Jones, Meegan Kelly, and Trent Blomberg).
-------
Table of Contents i
Tables iii
Figures iv
Executive Summary 1
1.0 Introduction 5
2.0 CHP in the Multifamily Housing Sector 6
2.1 Multifamily Building Characteristics 7
Building Size 7
Electricity Metering 8
Central Water Heating 8
Additional Building Loads 9
Unit Ownership 9
Building Ownership 10
2.2 Multifamily Housing Trends 11
2.3 Market Conditions Favorable For CHP 13
Metropolitan Areas 13
High Energy Costs 14
Older Buildings with Central Energy Distribution 15
Areas Interested in Lowering Greenhouse Gas Emissions 15
2.4 Multifamily CHP Installations 16
Characterizing Current Multifamily CHP Installations 17
Trends in Recent Multifamily CHP Installations 19
3.0 CHP Applicability in Multifamily Buildings 22
3.1 Decision Tree for CHP Installations at Multifamily Buildings 22
3.2 CHP Multifamily Buildings Modeling 23
3.3 Energy Loads for Multifamily Buildings 25
3.4 CHP Sizing Strategies 29
Normalized Average Energy Loads for Different Building Sizes and Climate Zones 30
3.5 Rules of Thumb for Multifamily CHP Sizing 31
4.0 Quantifying the Opportunities for Multifamily CHP 35
4.1 Dataset for Multifamily Buildings by Location and Size 36
4.2 Technical Potential for Multifamily CHP Installations 38
Maximum Technical Potential for Multifamily CHP 39
Achievable Technical Potential for Multifamily CHP 40
Achievable Technical Potential Assumptions 40
Achievable Technical Potential Results 41
-------
4.3 Economic Potential for Multifamily CHP Installations 44
Economic Potential Assumptions 45
Economic Potential Results 47
4.4 Estimate of Emission Savings Potential 49
5.0 Opportunities and Challenges in Multifamily CHP Project Development 52
5.1 Owner Perspective 53
Owner Challenges and Opportunities 54
5.2 Developer Perspective 57
Multifamily CHP Opportunities for Developers 58
Developer Challenges for Multifamily CHP 58
5.3 Policy Advocate Perspective 59
NYSERDA's CHP Program 60
Environmental Policies 60
5.4 Low Income Multifamily Perspective 62
6.0 Conclusions 66
Appendix A: Existing Resources for CHP in Multifamily Buildings 68
CHP and Multifamily Building Resources 68
General CHP Resources 70
Energy Efficiency in Multifamily Building Resources 71
ii
-------
Table 1. Technical and Economic Potential for Multifamily CHP in the U.S 3
Table 2. Influence of Metropolitan Areas on Applicability of CHP 14
Table 3. Multifamily CHP Installations: Number of Sites and Capacity by State 18
Table 4. Effect of Energy Efficiency Measures on Total Building Electricity Consumption 24
Table 5. Normalized Building Loads by Climate Zone and Building Size, with Energy Efficiency Measures
31
Table 6. Normalized CHP Sizing for Multifamily Buildings: Rules of Thumb 32
Table 7. Estimated Building Sizes and CHP Capacity by Building Size Range and CHP Sizing Strategy 33
Table 8. Total Multifamily Buildings without CHP, by Size Range and Census Division 37
Table 9. Maximum Technical Potential (MW) for Multifamily CHP (All Buildings, Maximum Size) 39
Table 10. Achievable Technical Potential (MW) for Master-Metered Multifamily Buildings with Central
Water Heating 42
Table 11. Achievable Technical Potential (MW) for Direct-Metered Multifamily Buildings with Central
Water Heating (Electric Sizing for Common Areas Only) 43
Table 12. CHP Equipment Characteristics Used in Economic Analysis 46
Table 13. Electric and Thermal Utilization Assumptions for CHP Economic Analysis 46
Table 14. Economic Potential (kW) for Multifamily CHP, by Sizing Strategy and Payback Period 48
Table 15. Economic Potential (<10-year payback) by State and Building Size Range 49
Table 16. Estimated Carbon Dioxide Equivalent Emissions Reductions from Multifamily Buildings with
Economic CHP Potential 50
Table 17. Selected NYSERDA-sponsored CHP Installations in New York City Affordable Housing 64
Table 18. Technical and Economic Potential for Multifamily CHP 66
iii
-------
Figure 1. Year of Construction for Multifamily Units Located in Master-Metered and Direct-Metered
Buildings (2015 RECS) 12
Figure 2. Housing Units in Multifamily Buildings with 50 or more Units, by State 13
Figure 3. Commercial Spark Spread, using Average State Electricity and Natural Gas Prices 15
Figure 4. Scatter Plot of 395 Current Multifamily CHP Installations by Year and Project Size 17
Figure 5. Current Multifamily CHP Installations by Prime Mover Type 18
Figure 6. Multifamily CHP Systems by CHP Size Range 19
Figure 7. Recent Multifamily CHP: Number of Installations and CHP Capacity by Year 20
Figure 8. Decision Tree for CHP in Multifamily Buildings 23
Figure 9. Electricity and Gas Consumption for Example 20-Floor Multifamily Building 25
Figure 10. Winter Average Hourly Electric Loads for 20-Floor Multifamily Building in Baltimore, MD 26
Figure 11. Winter Average Hourly Heating Loads for 20-Floor Multifamily Building in Baltimore, MD 27
Figure 12. Summer Average Hourly Electric Loads for 20-Floor Multifamily Building in Baltimore, MD...27
Figure 13. Summer Average Hourly Heating Loads for 20-Floor Multifamily Building in Baltimore, MD.. 28
Figure 14. Modeled CHP Size Estimates Compared to Average NYSERDA Multifamily CHP Sizes 33
Figure 15. Approach for Estimating the Technical and Economic Potential for Multifamily CHP 36
Figure 16. Map of Census Divisions 38
Figure 17. Multifamily Buildings with Master-Metered Electricity and Central Water Heating, by Size
Range 41
Figure 18. Achievable Technical Potential for Multifamily CHP by State 43
Figure 19. Achievable Technical Potential for Multifamily CHP by Sizing Strategy and Building Size Range
44
Figure 20. Lowest Estimated Payback Period by State for Multifamily CHP 48
iv
-------
Executive Summary
This report was prepared for the Environmental Protection Agency's Combined Heat and Power (CHP)
Partnership Program to provide a better understanding of CHP use and potential in multifamily
buildings. After providing context on the multifamily building market and market trends, the report
focuses on the scope and the technical and economic potential for additional CHP implementation,
culminating in a discussion of the opportunities and challenges for CHP in the multifamily sector.
Multifamily buildings are attractive candidates for CHP system installation. Such buildings have
significant energy costs, concurrent electricity and thermal energy demands, and power reliability and
resiliency needs that, when met, enhance residents' quality of life. A well-designed CHP system can help
meet these demands and, at the same time, increase the benefits of energy efficiency and avoided
emissions in multifamily buildings. However, the multifamily building sector is complex, characterized by
a range of different building types, sizes, and ownership structures, all of which affect CHP
implementation. The CHP value proposition varies according to a variety of internal and external factors.
Examples of factors that affect the CHP value proposition include building-specific design features, such
as the presence of centralized and shared hot water systems; whether electricity is master-metered at
the building level or direct-metered to individual units; and the market dynamics of utility energy rates,
which vary considerably by geography.
Through 2017, there were 395 operational CHP systems at multifamily buildings across the country.
Most of the installations are located in five key states -- New York, New Jersey, Pennsylvania,
Massachusetts and Connecticut -- with the total number of installations increasing over the last decade.1
Installations have especially increased in New York State, where targeted incentives from the New York
State Energy Research and Development Authority (NYSERDA) helped spur multifamily project
development. From 2008 through 2017, 65 percent of all new CHP installations in multifamily buildings
across the U.S. took place in New York State, representing 88 percent of total recent CHP capacity in
multifamily buildings.
CHP Market Analysis
This report estimates the potential for new CHP installations in multifamily buildings while considering
optimal development size (in square feet and number of units), infrastructural characteristics such as
central water heating and master- or direct-metered electricity, and different building ownership types.
It analyzes the technical and economic potential for CHP in existing multifamily buildings that are large
enough to support retrofitted CHP installations, encompassing both the market-rate and affordable
housing sectors. Data on multifamily buildings was assembled from several sources including the U.S.
Census Bureau, the U.S. Department of Energy's (DOE's) Energy Information Administration, and the
1 U.S. Department of Energy. CHP Installation Database. Maintained by ICF. Data current through Dec. 31, 2017.
https://doe.icfwebservices.com/chpdb/
1
-------
Executive Summary
Department of Housing and Urban Development (HUD).2 Overall, the report finds significant untapped
potential for CHP implementation in multifamily buildings, with potential concentrated in densely
populated urban centers where energy costs are typically high.
CHP sizing for multifamily buildings is based on energy loads that vary based on building size and
climate. In determining energy loads, the analysis assumes that typical lighting and building envelope
energy efficiency measures, such as upgraded windows and insulation, are installed at each building.
Taking likely efficiency upgrades into account, even if not yet implemented, helps avoid CHP oversizing.
Three different CHP sizing strategies were considered in the analysis, and for each a rule of thumb was
developed:
1. Sizing to fully utilize CHP heat for domestic hot water (DHW) loads, with thermal energy only
used for water heating: The CHP sizing rule of thumb is 0.15 kW per thousand square feet.
2. Sizing to average non-cooling electric loads and utilizing thermal energy for space heating
and/or cooling (in addition to water heating): The CHP sizing rule of thumb is 0.7 kW per
thousand square feet.
3. Sizing to average electric loads for common areas only3 (for direct-metered buildings), using
thermal energy for domestic hot water (DHW) and space heating: The CHP sizing rule of thumb
is 0.3 kW per thousand square feet of total building size.
These three sizing strategies were then applied to U.S. multifamily buildings to develop three estimates
of potential:
• Maximum Technical Potential, which assumes that all multifamily buildings can install a CHP
system, with electricity supplied to both common areas and tenants, where CHP is sized to the
average non-cooling electric load.
• Achievable Technical Potential, which applies percentages for central water heating and
master-metered electricity, where CHP size for direct-metered buildings is limited to the
average common area electric load.
• Economic Potential, which uses state average energy prices and CHP cost and performance
parameters to evaluate economics for CHP systems with different sizing strategies, where the
economic potential for CHP is based on buildings with payback periods fewer than 10 years.
The results of the market analysis are summarized in Table 1, with a breakdown by the number of
buildings and the associated total CHP potential for each estimate.
2 When evaluating energy loads and potential for CHP, assisted living buildings and additional loads from mixed-
use buildings (i.e., multifamily developments with commercial retail stores on the ground level) were not included
and are not considered in the analysis.
3 Common area loads include entryways, lobbies, hallways, elevators, building operations (fans and pumps), and
exterior lighting.
2
-------
Executive Summary
Stakeholder interviews found that there is a need for building owners, developers, and managers in
both the market rate and affordable housing sectors to understand:
• The nature and benefits of CHP, and the high level of planning and coordination required for a
CHP project to achieve these benefits;
• The importance of attention to project economics and the question of who benefits, and how,
from potential returns on investment; and
• The enabling role that incentive and financing programs can provide for education, awareness,
and help in moving potential projects forward.
Emerging Trends
The report captures a couple of trends that have emerged over the past few years and are significant in
both the CHP and multifamily sectors. The first trend is an increasing emphasis by local, state, and
federal agencies on resilience planning for extreme weather events, and the important role that CHP
plays as an onsite energy solution that can withstand long-duration grid outages. The second trend is a
greater interest in hybrid CHP systems,5 which combine the use of rooftop solar and storage, to achieve
a cleaner, resilient energy system, and potentially improved economics, compared to stand-alone CHP
systems.
The use of CHP as a solution for withstanding extreme weather events has been documented during
recent environmental events.6 Several states have evaluated CHP's ability to provide shelter-in-place
benefits, leading to the inclusion of CHP in policies and plans for achieving resilience in critical facilities.
Certain standalone CHP systems that are capable of "islanding" (where a generation system operating
on its own, in isolation, can provide power in the absence of a functioning electrical grid) have
successfully maintained critical operations during grid outages. Looking forward, CHP systems combined
with renewable technologies, in a hybrid or microgrid configuration, can support delivery of additional
benefits including baseload grid support and flexibility that enables greater integration of renewable
resources. Such capabilities can lead to opportunities to capitalize on CHP's unique value proposition,
especially as local and state clean and renewable energy policies continue to expand in size and scope.
Hybrid CHP systems offer a promising strategy for balancing the need to meet multi-day resilience
requirements at critical facilities with the need to minimize greenhouse gas (GHG) emissions in order to
support broader emission reduction policy goals.
5 Hybrid CHP in this context signifies the use of CHP in combination with renewables, either at the site or as part of
a microgrid or district energy system.
6 U.S. HUD, U.S. DOE and U.S. EPA. Guide to Using Combined Heat and Power for Enhancing Reliability and
Resiliency in Buildings. September 2013. https://www.epa.gov/chp/guide-using-combined-heat-and-power-
enhancing-reliabilitv-and-resiliencv-buildings
4
-------
1.0 Introduction
Combined heat and power (CHP) is an efficient way to generate both electricity and thermal energy (hot
water, steam, and/or chilled water) for buildings with consistent electric and thermal requirements.7
Historically, CHP has primarily been used by industrial manufacturing facilities, but commercial,
institutional, and residential buildings can also benefit from CHP.8
Multifamily buildings have characteristics that make them good candidates for installing CHP systems.
They have a consistent need for electricity and thermal energy to provide hot water and space
conditioning for residents; they operate around the clock for the entire year; they need to have reliable
power systems in the event of outages; and they tend to be in urban areas were electricity rates are
likely to be high. This fit has been seen more frequently in recent years. From 2015 through 2017,
among all building types, multifamily buildings have had the most CHP systems installed, as documented
in the Department of Energy's CHP Installation Database.9 These systems have primarily been installed
at multifamily buildings in the Northeastern states and California.
The intent of this report is to make evident to multifamily building10 owners, developers and policy
makers broadly CHP benefits, opportunities and challenges. To that end, this report describes
multifamily building characteristics and trends and provides an evaluation of energy consumption by
building size and location. This characterization is the basis for a technical and economic screening of
CHP market potential in the sector. The report is organized in the following sections:
1. Introduction, describing the purpose and organization of the report.
2. CHP in the Multifamily Housing Sector, describing multifamily building characteristics and
trends and providing information on which features are best for CHP.
3. Energy Use and CHP Sizing in Multifamily Buildings, containing energy usage characteristics
related to CHP implementation, including electric and thermal energy usage load shapes.
4. Quantifying the Opportunities for Multifamily CHP, providing information on the overall CHP
market potential in multifamily buildings by size and state.
5. Opportunities and Challenges for Multifamily CHP, containing an overall evaluation of the
competitiveness of CHP in the multifamily building industry.
7 For more information on CHP, see the EPA Combined Heat and Power Partnership website, www.epa.gov/chp
8 U.S. Department of Energy, Advanced Manufacturing Office. Combined Heat and Power (CHP) Technical Potential
in the United States. March 2016.
https://www.energy.gov/sites/prod/files/2016/04/f30/CHP%20Technical%20Potential%20Studv%203-31-
2016%20Final.pdf
9 U.S. Department of Energy. CHP Installation Database. Maintained by ICF. Data current through Dec. 31, 2017.
https://doe.icfwebservices.com/chpdb/
10 This report defines multifamily buildings as residential buildings with multiple tenants encompassing both
market-rate and affordable developments that are large enough (typically more than 50-100 housing units) to
support a CHP system. The definition excludes assisted living and mixed-use buildings (commercial and residential
uses in a building).
5
-------
2.0 CHP in the Multifamily Housing Sector
The varied and complex housing stock of the United States - comprising single-family, multi-family, and
mobile home residences over diverse climate geographies - accounts for over 20% of the nation's total
annual energy consumption.11 An examination of U.S. Energy Information Administration (EIA) data
shows that when compared to the three other energy-consuming sectors (industrial, transportation, and
commercial buildings) the residential sector has a far greater proportion of consumption due to
electrical losses from inefficient generation, transmission, and distribution than it does from primary
consumption, defined as direct consumer use at the source. These losses and inefficiencies from low-
voltage distribution interconnections result in a cumulative loss of over 10 quadrillion BTUs in energy
annually.12 CHP, a distributed energy resource that provides useful thermal energy and electricity near
the point of consumption, holds an opportunity to address such losses, thus reducing wasted energy and
expense for owners while improving the carbon footprint of the United States.
A combination of factors makes multifamily housing a potentially rich target for CHP:
• Inherent market opportunity. Two of every 10 Americans live in a unit in a multifamily
building.13 Many of these buildings contain centralized energy systems that can incorporate
CHP.
• Coincident need for electricity and thermal energy. Multifamily buildings operate 24 hours a
day, seven days a week, with a consistent need for both electricity, water heating, and space
heating/cooling.
• Benefits of resilient CHP. CHP can allow multifamily buildings to continue operation during
utility grid outages, ensuring that critical loads at multifamily buildings stay operational, adding
to quality of life for tenants.
• Multifamily housing's disproportionately high energy use compared to other forms of existing
residential construction. Although the dense spatial configuration of multifamily as compared
with single-family housing would suggest its greater energy efficiency, the national data
contradicts such an assumption. Multifamily buildings make up 18% of the total residential
building stock but use 28% of the energy.14
The multifamily housing sector is a strong market for CHP, but it is also a complex market with many
variables that can impact both a CHP system's applicability and economic viability. A multifamily building
needs to be large enough for CHP to be a viable option, and hot water needs to be delivered through a
11 See the Energy Information Administration's summary report on "Energy Consumption By Sector,"
https://www.eia.gov/totalenergv/data/monthlv/pdf/sec2.pdf. Accessed December 30, 2017.
12 Ibid.
13 O'Malley, Charlotte. "80 Percent of Americans Prefer Single-Family Homeownership". Builder. August 2013.
http://www.builderonline.com/monev/economics/80-percent-of-americans-prefer-single-family-
homeownership o
14 Brown, Matthew and Mark Wolfe. Energy Programs Consortium. Energy Efficiency in Multi-Family Housing, A
Profile and Analysis. June 2007. Pp. 1, 7.
6
-------
2.0 CHP in the Multifamily Housing Sector
centralized distribution system to efficiently utilize CHP's thermal energy through hot water delivery to
building tenants. Additionally, there are two different ways that multifamily buildings can be metered
for electricity, which can affect the applicable electric loads for CHP.
Multifamily buildings can either be master-metered for electricity - with bills paid by the owner and
distributed through rent or condo fees - or tenant units can be individually metered for electricity,
referred to as "direct metering" in this report. While CHP can be applied to direct-metered buildings, the
ability for CHP electricity to be applied to tenant loads could be limited, leaving only common area
loads, and limiting the potential size of the installation.
These factors can potentially limit opportunities for multifamily CHP applications and prevent a "one
size fits all" solution. However, CHP has proven to be beneficial for many multifamily buildings, and
installations have been increasing in recent years. The growth of CHP in the multifamily sector has
resulted in a roster of effective installations, which could improve consumer confidence among the next
batch of prospective adopters and bolster the credentials of solution providers. This chapter examines
the complexities involved in applying CHP to multifamily buildings, describing the status and recent
trends of the multifamily housing market and the factors influencing demand for and/or constraints to
CHP implementation within that market.
There are several infrastructural and ownership characteristics of multifamily buildings that can affect
the suitability and viability of CHP installations, including:
• Building size
• Electricity metering
• Central water heating
• Additional building loads
• Unit ownership
• Building ownership
This section explores these characteristics of multifamily buildings and describes how they can influence
the viability of CHP installations. Note that there are other characteristics that affect CHP installations,
such as the socioeconomic status of residents and whether it is in a multi-building campus (either in a
microgrid or district energy systems). These characteristics have not been explored in detail in this
report, and are areas recommended for further analysis.
Building Size
Multifamily buildings can be characterized by the number of housing units they contain and their total
square footage. Larger buildings have higher energy loads that can support commercially available and
economically viable CHP systems. The U.S. Department of Housing and Urban Development (HUD)
developed a toolkit for renewable energy in affordable housing, which included suggestions for CHP. The
HUD toolkit recommended multifamily buildings with 100 or more housing units as the minimum size to
7
-------
2.0 CHP in the Multifamily Housing Sector
be used as a screening mechanism for CHP viability.15 Other data, including the energy load analysis
conducted in chapter 3 of this report, suggests that buildings in the 50-100-unit size range are also
viable CHP candidates, while buildings with less than 50 housing units are likely too small to support
CHP.
Electricity Metering
How a multifamily building's electricity is metered to the utility can have a major impact on the
likelihood of CHP installation. If a building is master-metered for electricity, then the building owner
pays the electric bills and passes on the power costs to tenants as part of the rent or condo fees. In such
buildings, the owner can install CHP behind the master-meter and recoup the investment through
electric bill savings or pass on the savings to tenants in the form of competitively lower rents.16 With
master-metered buildings, CHP systems can be sized to full building energy loads.
If a multifamily building has electricity sub-meters installed on a by-unit basis, then each tenant unit is
directly metered by the utility and is responsible for its own electric bills. This can limit the ability of CHP
electricity to be delivered to each tenant. Multifamily buildings with directly metered individual units
can still benefit from CHP, but the size will likely be limited to electric loads for common areas such as
entryways, lobbies, hallways, and parking lots.
Central Water Heating
Large multifamily buildings have a high and near-constant need for domestic hot water accentuated by
morning and evening spikes, and most are equipped with central water heaters or boilers, and often
some domestic hot water storage, to deliver hot water to each tenant. When designing a large
multifamily building, there is a substantial cost associated with installing individual water heaters in each
unit, in addition to the associated decrease in valuable living space.17 Therefore, most large multifamily
buildings have central water heating, which allows thermal energy from a CHP system to be directly
applied to water heating loads. Even when thermal energy from a CHP system is used for space heating
or cooling, the system is also typically configured to provide hot water to the building year-round to
maximize the operational efficiency.
Some multifamily buildings are not equipped with central water heating, instead using small individual
water heaters in each dwelling unit. These buildings tend to be smaller, with owner-occupied units, and
they are not configured to distribute hot water throughout the building. Multifamily buildings that do
15 U.S. Department of Housing and Urban Development, Community Planning and Development, Renewable
Energy Toolkit for Affordable Housing, 2018.
16 This would be especially likely to occur in markets experiencing increased vacancy, as energy cost savings would
help enable the rent reductions necessary to keep units filled. In addition, vacant units incur increased financial
exposure as owners would need to pay for energy and capital recovery costs.
17 Hynek, Don; Levy, Megan; Smith, Barbara; Wisconsin Division of Energy Services. "Follow the Money":
Overcoming the Split Incentive for Effective Energy Efficiency Program Design in Multi-family Buildings". ACEEE
Summer Study on Energy Efficiency in Buildings. 2012.
https://aceee.org/files/proceedings/2012/data/papers/0193-00Q192.pdf.
8
-------
2.0 CHP in the Multifamily Housing Sector
not have central water heating may find it difficult to efficiently utilize the thermal energy from CHP
installations.
The Energy Information Administration's Residential Energy Consumption Survey (RECS) provides
representative data that can be applied to all households across the country, including multifamily
dwellings. An analysis of the latest 2015 RECS data showed that 56 percent of multifamily dwellings
(with 5 or more units) in the U.S. receive hot water from a central water heater or boiler that serves
multiple tenants.18 However, larger buildings that are master-metered for electricity are more likely to
use central water heating. When evaluating only buildings that are master-metered for electricity, over
81% of these multifamily dwellings were found to have central water heating.19
Additional Building Loads
Multifamily buildings typically consist of common areas (i.e. entryways, lobbies, hallways, elevators,
parking garages, and operations spaces for boilers, HVAC equipment, and water pumps), and dwellings
for tenants. Some multifamily buildings have additional spaces with specialized energy requirements,
including swimming pools, fitness centers, and gymnasiums. Furthermore, in urban areas, multifamily
buildings often share space with ground-level retail stores and restaurants, creating mixed-use buildings
with additional energy loads that could potentially be supported by CHP. Many recent CHP installations
at multifamily buildings have occurred at facilities with swimming pools and mixed uses, allowing
electric and thermal outputs from CHP to be applied more consistently.
Unit Ownership
From the point of view of the occupants of multifamily buildings, there are two basic ownership types.
The first is the cooperative or condominium model, where owners own either their units or shares in the
building equivalent to the square footage of their units. In newer owner-occupied multifamily
developments, energy systems tend to be decentralized, with each unit direct-metered for electricity
and having its own contained hot water and HVAC systems. In older developments, energy systems are
more likely to be centralized. In individually direct-metered or individual energy system units, unit
owners can control their energy systems, and thus have the power to directly affect their energy use
behavior and consequent savings.
In the second multifamily ownership type, rental units (apartments, in commercial real estate terms),
this power is often absent. Rentals encompass a range of target audiences and income levels, from
market-rate to affordable housing. Commonly, in multifamily market-rate rental housing, the landlord
prorates whole building energy use by unit square footage and passes on the cost through rent. The
owner/developer/landlord has a reduced incentive20 to invest in efficient energy systems, since they
18 U.S. Department of Energy, Energy Information Administration. 2015 Residential Energy Consumption Survey.
https://www.eia.gov/consumption/residential/
19 Ibid.
20 In such cases, circumstances and awareness will affect an owner's willingness to invest in energy efficiency. For
example, where the market will not support an increase in rents, owners may have an incentive to invest in energy
efficiency, since reducing energy costs becomes one of the few ways to increase net operating income.
9
-------
2.0 CHP in the Multifamily Housing Sector
pass on the cost to occupants. Indeed, the reverse is true, as it is a less expensive first cost to install
conventional rather than efficient central systems. Renters in these types of buildings have no incentive
to save because they do not pay for energy costs directly. This energy efficiency barrier is known as "the
split incentive." This can also occur in buildings where units are owned by the tenants rather than
rented, as electricity may be master-metered and included in condo fees. And in affordable or public
rental housing sponsored by the Department of Housing and Urban Development (HUD), there may be
an actual disincentive towards energy efficiency; under HUD guidelines, low-income tenants receive
utility allowances set by historical energy cost and use - the higher the use, the greater the utility
allowance. Thus, implementation of efficiency measures reduces the HUD subsidy as opposed to
accruing financial savings to the party that would pay to implement the efficiency measures.
Ultimately, electricity metering and central water heating are the primary indicators of CHP applicability,
but different classes of building owners - private versus public - may be more prone to overcome the
split incentive and install energy-efficient systems like CHP.
Building Ownership
There is limited literature examining the role of incentives at multifamily buildings broken down by
ownership type. A 2012 paper outlines findings related to the problem of split incentives by ownership
type in Wisconsin.21 It concludes that for privately-capitalized, privately-operated buildings and their
owners there is little incentive towards energy efficiency since owners "bear no costs for utilities unless
the property is especially inefficient."22 The same barrier exists for privately-capitalized, publicly-funded
multifamily buildings and for publicly-capitalized, privately-operated buildings (which tend to be more
recently built low-income and/or senior housing). For these ownership types, the existence of utility and
government incentives for CHP may be the deciding factor in energy system retrofits.
The 2012 paper finds that publicly-capitalized, publicly-operated multifamily buildings are potentially
fertile ground for energy efficiency projects. Owner-operators, usually public housing authorities with a
mission to shelter residents from high housing costs, do not intend to sell their buildings to other owner-
managers, and thus prioritize low operating costs and can accept longer returns on investment in energy
efficient systems. These factors could be conducive to CHP implementation.
Although publicly-owned multifamily buildings may be more prone to install energy efficient systems
like CHP, the economics and benefits of CHP until now have been a more attractive option to private
owners of multifamily buildings. In areas of the country with high energy prices and incentives for CHP
installations, such as New York City, many privately-owned multifamily buildings have been
implementing CHP. Chapter 5 of this report highlights several New York City case studies in owner
21 Hynek, Don; Levy, Megan; Smith, Barbara; Wisconsin Division of Energy Services. "Follow the Money":
Overcoming the Split Incentive for Effective Energy Efficiency Program Design in Multi-family Buildings". ACEEE
Summer Study on Energy Efficiency in Buildings. 2012.
https://aceee.org/files/proceedings/2012/data/papers/0193-00Q192.pdf
22 Ibid, pp. 6-142.
10
-------
2.0 CHP in the Multifamily Housing Sector
decision-making in favor of CHP, in which the New York State Energy Research and Development
Authority (NYSERDA) provided CHP incentives and assistance to the multifamily sector. In the Brevoort
residential high-rise in Manhattan, in addition to environmental and financial benefits, owner-initiated,
NYSERDA-supported CHP installation has resulted in increased resiliency to storms and power outages.
During Superstorm Sandy, the Brevoort, with 290 individual units, was able to maintain its energy
systems to power central boilers, elevators, and all apartments; as a result, it became a community
haven, doubling its normal occupancy during the storm.23
The multifamily housing sector is expected to grow, based on the trend of increasing urbanization. A
2015 report for CB Richard Ellis (CBRE)24 underlines how shifting demographic trends towards smaller
families (2.6-person average U.S. household size), later-in-life marriage, and lifestyle preferences for
urban living are driving real estate trends in cities. The CBRE report names the top U.S. cities
experiencing a double-digit increase in the pace of population growth in downtown areas (defined as
within two miles of city hall) between 2000 and 2010: Chicago, New York, San Francisco, Philadelphia,
and Washington, DC. In terms of multifamily housing starts, a January 2017 report by Principia
Consulting25 shows the greatest overall increases in new multifamily housing construction between 2015
and 2016 were in the Mountain region (38.5%) and the East North Central region (22.9%), and the West
North Central region (10.4%).
Older multifamily buildings, constructed in the era when energy costs were comparatively inexpensive,
are more likely to have central water heating and master-metered electricity, but as a general trend,
multifamily buildings are moving away from central energy systems and towards distributed in-unit
water heaters and sub-metered or direct-metered electricity. In this way tenants or tenant-owners
become responsible for the costs of their own consumption, a reality that encourages efficient behavior.
Various utilities and state governments have created incentive programs for older, master-metered
buildings to install energy sub-meters. For example, NYSERDA previously offered an Energy Reduction in
Master Metered Buildings (ERMM) Program to provide up to 50% of the cost of installing sub-meters in
master-metered multifamily buildings with more than five units where tenants do not currently pay for
their electric usage.26
The 2015 Renewable Energy Consumption Survey (RECS) includes data on whether electricity bills are
paid by the tenant (direct-metered) or included as part of rent or condo fees (master-metered). As
23 U.S. Department of Energy, Better Buildings Initiative. Combined Heat and Power for Resiliency. May 2016.
https://betterbuildingssolutioncenter.energy.gov/sites/default/files/Combined Heat and Power for Resiliency
Organizational Strategies WED.pdf
24 CBRE Global Investors. U.S. Urbanization Trends. January 2015.
25 Principia. " Residential Construction: Top 10 Areas Experiencing Growth in the United States". January 2016.
https://www.principiaconsulting.com/residential-construction-top-10-areas-experiencing-growth-in-the-united-
states/
26 Geberer, Raanan. "Submetering Your Building's Electricity". The Cooperator, New York. September 2011.
https://cooperator.com/article/submetering-vour-buildings-electricitv/full
11
-------
2.0 CHP in the Multifamily Housing Sector
Louis, Chicago, Austin, Atlanta, Orlando, Washington, DC, Philadelphia, New York City, Boston,
Cambridge, and Portland (ME). Note that, as mentioned earlier, CBRE's top five rapidly urbanizing cities -
- Chicago, New York, San Francisco, Philadelphia, and Washington, DC -- are among the local
governments with energy use benchmarking and disclosure mandates. Participation in ENERGY STAR'S
Multifamily High-Rise (new construction) Building program is also a bellwether; its Locator35 shows
greatest concentrations of ENERGY STAR multifamily properties in New York and Philadelphia.
A recent report by Greentech Media illustrates the power of public sector incentives for implementing
CHP. The report notes that multifamily residential buildings have been the fastest growing customer
type in the CHP market, with a 46 percent increase in just five years, citing the reasons for owner
adoption of CHP as "saving money, improving resiliency, and raising comfort." The development of
small-footprint CHP technology, with public-sector incentives, has also made a difference: "a small 5- or
10-kilowatt micro CHP has a small enough footprint -- less than 4 feet wide and 2 feet deep -- to fit
almost anywhere, and still provide sufficient money savings and grid security for a small multifamily
building. The NYSERDA CHP Incentive Program included systems less than 50 kilowatts under its
eligibility criteria."36
CHP systems have been generating electricity and heat in multifamily buildings for over six decades in
the U.S. However, multifamily CHP applications have changed significantly in recent decades. In the
1960s and 1970s, larger CHP systems were installed as central power plants for multiple multifamily
buildings, sometimes serving nearby retail establishments like shopping malls and grocery stores in
district energy systems. As an example, the 20 MW Rochdale Village CHP system installed in 1962 still
provides electricity, heating, cooling, and domestic hot water (DHW) to the multi-building Rochdale
residential development and two shopping malls in Jamaica, Queens, New York.37
The Department of Energy's CHP Installation Database provides insights on the characteristics of current
multifamily CHP installations throughout the U.S. Through December 2017, there were a total of 395
multifamily buildings with installed CHP systems operating in 15 different states and D.C., with a total
capacity of 149 MW.38 Many of the older mixed-use, multi-building CHP installations have shut down
over time. In recent years, most multifamily CHP systems have been installed in single buildings with
significantly smaller project sizes, largely due to the increase in economically viable CHP product
offerings in the sub-500 kW size range.
35 Energy Star. "Multifamily High-Rise Building Locator".
https://www.energystar.gov/index.cfm?c=bldrs lenders raters.nh mfhr certified multifamily units#mfhr-
building-locator
36 Shibata, Mei. "The Changing Face of CHP Customers". Greentech Media. May 2016.
https://www.greentechmedia.eom/articles/read/the-changing-face-of-chp-customers#gs.w3QdxPck
37 U.S. Department of Energy. CHP Installation Database. Maintained by ICF. Data current through Dec. 31, 2017.
https://doe.icfwebservices.com/chpdb/
38 Ibid.
16
-------
2.0 CHP in the Multifamily Housing Sector
cooling loads. Although there are several different thermal utilization options, due to variable loads,
some of the heat from CHP systems cannot be used by the buildings, with about 70 percent of the
available thermal being utilized on average.43
Modular installations with multiple packaged CHP systems have been a recent trend for commercial
buildings. For a majority of NYSERDA-tracked multifamily CHP installations, multiple CHP units are
installed in parallel. In a multi-unit system, one or more of the CHP units can shut down during periods
of low demand, allowing the other unit(s) to operate more efficiently. From the tracked NYSERDA
multifamily CHP installations, 60 percent have more than one CHP unit, with 18 percent consisting of
three, four, or five units.
As more multifamily CHP systems are installed, and more operational data is collected, the NYSERDA
tracking system will continue to be a valuable resource for insights on the multifamily CHP market,
including successful CHP sizing and deployment strategies relative to multifamily building characteristics
and energy loads.
43 Ibid
21
-------
3,0 Energy Use and CHP Sizing in Muitifamily Buildings
Does the building have
more than 50 housing
units?
Does the building have
central water heating?
Building may be
too small for CHP
Is the building master-
metered for
electricity?
Analyze DHW and full
building electric
loads, model CHP
cost and performance
CHP may not be
applicable -limited
potential for thermal
utilization
Analyze DHW and
common area electric
loads, model CHP
cost and performance
¦ 0.15 kW per 1000 sq ft
Size CHP system to
supply DHW loads to
maximize efficiency
Size CHP system to
non-cooling electric
loads, use thermal
energy for DHW +
space conditioning
' 0.7 kW per 1000 sq ft
-0.15 kW per 1000 sq ft
Size CHP system to
supply DHW loads to
maximize efficiency
Size CHP system to
common area
electric loads, use
thermal energy for
DHW + space heating
" 0.3 kW per 1000sq ft
Compare costs
and benefits
Compare costs
and benefits
Figure 8. Decision Tree for CHP in Muitifamily Buildings
3.2 CHP Muitifamily Buildings Modeling
For muitifamily buildings that are good candidates for CHP installation, a key step in the implementation
process is to consider typical energy loads based on climate zone and building size attributes. The
Energy Information Administration's Residential Energy Consumption Survey (RECS) contains data on
muitifamily dwellings, including building materials and characteristics. This data was used to model
typical household and building properties for muitifamily buildings in different locations across the
country. Representative buildings from the RECS survey were chosen for each of the five different U.S.
climate zones defined by the American Institute of Architects (AIA), based on total heating degree days
(HDD) and cooling degree days (CDD) throughout the year.44
44 Cooling Degree Days (CDD) are defined as the number of degrees that daily average temperatures are above 65°
F, while Heating Degree Days (HDD) indicate the number of degrees that daily average temperatures are below 65°
23
-------
3,0 Energy Use and CHP Sizing in Muitifamily Buildings
5,000
4,500
4,000
=> 3,500
CD
~ 3,000
05
0
I
2,500
1 2,000
aj
00
ra
5 1,500
>
<
1,000
500
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Hour
¦ DHW Space Heating
Figure 11. Winter Average Hourly Heating Loads for 20-Floor Muitifamily Building in Baltimore, MD
900
800
700
600
-a 500
00
0
_J
u
1 400
u
a>
LU
ftO 300
2
>
<
200
100
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Hour
¦ Common Areas ¦ Tenant Loads ¦ Cooling Loads
Figure 12, Summer Average Hourly Electric Loads for 20-Floor Muitifamily Building in Baltimore, MD
27
-------
3.0 Energy Use and CHP Sizing in Multifamily Buildings
Typical CHP performance characteristics for electric and thermal output were compared to the load
profiles, and some general conclusions were drawn from the analysis:
• Sizing to average DHW loads enables efficient utilization of electricity and thermal energy.
o This strategy results in a relatively small CHP system, but can be applied to both master-
metered and direct-metered buildings with central water heating.
• Common area electric loads are more consistent than tenant electric loads, and sizing to
common area loads is a viable strategy, especially for direct-metered buildings
o Sizing to the average common area electric load (including exterior lighting and building
operations) would result in relatively efficient CHP system operation, with thermal
energy utilized for DHW and some space heating loads.
• Sizing to full building electric loads increases the CHP size, which can result in improved
performance and lower per-kW costs, but variable loads may lead to low operational
efficiency.
o To avoid oversizing for winter months, avoid cooling loads when sizing the CHP system.
With loads for domestic hot water and non-cooling electricity remaining relatively consistent across
climate zones, general rules of thumb for CHP sizing can be developed.
There are several CHP sizing strategies that can be implemented at multifamily buildings. To maximize
operational efficiency, CHP units can be sized to average DHW loads. During periods of low DHW
demand, thermal energy from the CHP system can be stored in a hot water storage tank, to be used
during higher demand periods. In colder climates, DHW loads are higher in winter months, so sizing to
average summer DHW loads will result in full utilization of available thermal energy year-round. The
drawback to this strategy is the small size of the CHP system, which can result in a higher installation
cost per kW and limit the total potential energy savings. Another common strategy is to size the system
to provide baseload electricity for the building while using available thermal energy for DHW and space
heating loads. The primary drawback to this configuration is low thermal utilization during periods when
space heating is not required.
Another strategy would be to improve thermal efficiency by adding an absorption chiller to the system
allowing thermal energy from the CHP system to be utilized for cooling loads. However, absorption
chillers are a significant capital expense, and it may be difficult to recover the investment with seasonal
operation.
When determining the maximum size for baseload CHP systems compared to building electric loads,
seasonal cooling loads may be ignored to avoid oversizing. With the use of an absorption chiller, thermal
energy from CHP systems - rather than electricity - can be applied to the seasonal cooling loads. A CHP
system sized for baseload electricity will be sized no larger than the building's average non-cooling
electric load.
29
-------
3.0 Energy Use and CHP Sizing in Multifamily Buildings
In this analysis, three different sizing strategies for multifamily buildings were considered:
1. Sizing to fully utilize CHP heat for DHW loads, with thermal energy only used for water heating,
2. Sizing to average non-cooling electric loads, and utilizing thermal energy for space heating
and/or cooling (in addition to water heating), and
3. Sizing to average electric loads for common areas only (for direct-metered buildings), utilizing
thermal energy for DHW and space heating.
Multifamily building loads vary depending on building size, configuration, and climate.48 In an effort to
understand how these CHP sizing strategies can be applied, energy loads were modeled and analyzed
for differently-sized multifamily buildings in each of the five identified climate zones. Building loads were
normalized on a square foot basis to directly compare the results of the load analysis and develop rules
of thumb for CHP sizing.
Normalized Average Energy Loads for Different Building Sizes and Climate Zones
Using the eQUEST tool, 8,760-hour49 load profiles were developed for multifamily buildings for different
building sizes (5, 10, 20 and 30 floors) in each of the five climate zones to evaluate relationships
between building size, climate, and energy loads, and determine if rules of thumb could be developed
for multifamily CHP sizing. All buildings were modeled with typical energy efficiency measures (lighting,
windows, and roof insulation) in place.
When average building loads are normalized by square footage, similar results were obtained for non-
cooling total building loads, common area loads, and DHW loads across all building sizes and climate
zones, meaning that general rules of thumb can be derived for sizing CHP systems to multifamily
buildings regardless of variations in size and climate. The results of the analysis are shown in Table 5.
Average non-cooling loads are relatively consistent across modeled building sizes and climate zones, at
close to 0.7 kW per thousand square feet for the whole building, or 0.3 kW per thousand square feet for
common areas. The average summer DHW loads50 tended to fall close to 0.65 MBtu/hr per thousand
square feet, which translates to about 0.15 kW per thousand square feet when factoring in typical CHP
efficiencies.
48 Building loads also vary based on socio-economic characteristics, but data was not available to accurately
represent these attributes at the national level in the analysis.
49 There are 8,760 hours in a year.
50 Average Summer DHW loads were used due to the seasonal variation in hot water loads in colder climates.
30
-------
3.0 Energy Use and CHP Sizing in Multifamily Buildings
In practice, CHP at New York multifamily buildings tends to be sized to provide baseload electricity, hot
water, and space heating to building tenants. Despite potential losses in efficiency, economics for larger
CHP installations may supersede smaller DHW sizing options, especially in areas with high electricity
pricing like New York City. For example, as shown in Figure 14, CHP systems in New York tend to be sized
larger than NYSERDA's conservative sizing guidelines for master-metered multifamily buildings in the
100 - 199 unit and 200 - 299 unit size ranges (0.25 - 0.35 per apartment, or 50-70 kW for a 200-unit
building).51
While larger CHP systems may have favorable economics, operational efficiencies and thermal
utilization may not be as high as smaller systems sized to efficiently displace DHW loads. Electric
capacity factors and thermal utilization percentages for CHP operation will depend on which sizing
strategy is selected, the location of the system, and whether the thermal energy will be used for space
heating and/or cooling. These factors are taken into consideration for the economic analysis presented
in the next section.
51 New York State Energy Research and Development Authority (NYSERDA). Combined Heat and Power Program,
PON 2568 Summary, CHP Sizing Guidelines. http://nvserda.nv.gov/PON2568
34
-------
4.0 Quantifying the Opportunities for Multifamily CHP
With the CHP sizing strategies and rules of thumb developed in Section 3, the total technical and
economic potential for CHP in multifamily buildings was estimated. Four data sources were used to
develop a data set representing the number of buildings that are suitable for new CHP installations.
1. The U.S. Census Bureau tracks the number of housing units located in multifamily buildings, by
state, for buildings with 5-19 units, 20-49 units, and 50 or more units.
2. The U.S. Energy Information Administration (EIA) collects detailed statistics for energy and
building characteristics of multifamily housing as part of their Residential Energy Consumption
Survey (RECS).
3. The U.S. Department of Housing and Urban Development (HUD) maintains several housing
data sources, including comprehensive property-level data for a sample of close to 30,000
multifamily buildings.
4. The U.S. Department of Energy's CHP Installation Database quantifies existing CHP installations
at multifamily buildings - these buildings are not considered for new CHP installations.
Data from all these sources was used to yield several multifamily buildings in each state that could
potentially support CHP installations. The technical potential, economic potential, and carbon savings
potential for CHP in multifamily buildings was evaluated in four steps, described below and outlined in
Figure 15.
1. Maximum Technical Potential, which assumes that all multifamily buildings not currently
utilizing CHP can install a CHP system, with electricity supplied to both common areas and
tenants (CHP sized to average non-cooling electric load).
2. Achievable Technical Potential, which applies percentages for central water heating and
master-metered electricity, where CHP size for direct-metered buildings is limited to average
common area electric load.
3. Economic Potential, which, using state average energy prices and CHP cost and performance
parameters, evaluates economics for CHP systems with different sizing strategies, where
buildings with payback periods under 10 years are said to have economic potential for CHP.
4. Carbon Savings Potential, which evaluates the potential for carbon dioxide equivalent savings
compared to separate heat and utility-purchased power for multifamily buildings with
demonstrable economic potential for CHP.
35
-------
4.0 Quantifying the Opportunities for Multifamily CHP
State Average
Energy Prices
Central Water
Heating (%)
Direct-Metered
Tenants (%)
Master-Metered
Tenants (%)
electric load -
Evaluate Economics
cooling electric load -
Evaluate Economics
savings to installed cost,
Payback < 10 years
Estimated Carbon Savings
Achievable Technical
Potential
CHP applied to full building
loads if master-metered, to
common areas if direct-
metered
Maximum Technical
Potential
CHP applied to full building loads for
all multifamily buildings with >50 units
Identify All Multifamily Buildings
with CHP Potential
by Location and Size Range
Figure 15. Approach for Estimating the Technical and Economic Potential for Multifamily CHP
4.1 Dotasetfor Multifamily Buildings by Location and Size
A dataset was compiled to estimate the total number of multifamily buildings by size range (number of
units) and location (Census Division and state). Each data source provided critical information for
quantifying the total multifamily housing market by location and size range. The dataset was compiled
by taking the following steps:
1. Residential Energy Consumption Survey (RECS) data52 yielded the total number of representative
multifamily buildings by Census Division and size range:
a. 50-99 units (smallest calculated size for CHP in master-metered buildings)
b. 100-199 units (smallest calculated size for CHP in direct-metered buildings)
c. 200 or more units (smallest calculated size for CHP when sized to DHW loads)
52 Energy Information Administration (EIA). Residential Energy Consumption Survey (RECS). 2009.
Note: the 2009 RECS survey included data for the total size of the multifamily building for each representative
dwelling, but this information was not included in the 2015 RECS survey data.
36
-------
4.0 Quantifying the Opportunities for Multifamily CHP
These steps resulted in state-level estimates for CHP opportunities at multifamily buildings by size range,
as summarized in Table 8, by Census Division and building size range. Figure 16 shows the breakdown of
Census Divisions. Based on the analysis, there are approximately 72,000 buildings with 50 or more units
that couid potentially support commercially available CHP options. While there are potential buildings
for multifamily CHP installations across the country, the Mid-Atlantic, Pacific, and South Atlantic Census
Divisions have the highest number of CHP candidates.
Pacific
Mountain
Mew
England
West North
Central EastNortfi
, Central
Middle
Atlantic
South
West South _ „ Atlantic
EasrScutTi
Central
Centra]
DC
Pacific
Figure 16. Map of Census Divisions
4.2 Technical Potential for Multifamily CHP Installations
The technical potential for multifamily CHP is an estimation of the total market size that can support
CHP to serve electric and thermal loads at multifamily buildings, constrained only by technological
limits.58 The first step in estimating the technical potential is to determine the appropriate CHP sizes for
each multifamily building size category. This was calculated by applying the estimated CHP sizes from
Table 7 in the previous section to the appropriate number of buildings from Table 8 above. Two types
of technical potential were estimated:
1. The Maximum Technical Potential, which assumes that aii electric and thermal loads at
multifamily buildings could be served by CHP
2. The Achievable Technical Potential, which narrows down the Maximum Technical Potential
based on the estimated number of buildings with central water heating and direct-metered
electricity. Buildings without central water heating are removed, while a size constraint is
applied to buildings with direct-metered electricity.
58 A 2016 U.S. Department of Energy CHP technical potential report (U.S. DOE, U.S. Technical Potential in the U.S.,
2016) identified the same maximum technical potential in the multifamily sector. This study considers more
sector-specific factors to provide an achievable technical potential and the economic potential for CHP at
multifamily buildings in each state.
38
-------
4.0 Quantifying the Opportunities for Multifamily CHP
Achievable Technical Potential for Multifamily CHP
To efficiently utilize CHP, multifamily buildings would typically have a central boiler or water heater that
supplies hot water to all the building's tenants. The potential for CHP in a multifamily building is also
limited by the way electricity is metered to the tenants. If tenants are direct-metered directly to the
utility (i.e. they pay their own electric utility bills) then applying CHP electricity to individual housing
units can be a major challenge. In such building configurations, the CHP system size would be limited to
average common area loads. The achievable technical potential for multifamily buildings takes these
design elements into consideration. Each of these elements is further discussed below, before they are
used to derive the achievable technical potential.
Achievable Technical Potential Assumptions
Central Water Heating
Residential water heating plays an important role in determining the feasibility of a multifamily CHP
project. If small water heaters are located within individual housing units, then heat from a CHP system
cannot be recovered and delivered to the tenants as domestic hot water (DHW). Although thermal
output from CHP units can be applied to space heating and cooling loads, domestic water heating loads
are more consistent throughout the year, providing a base load of thermal energy for efficient CHP
utilization.
Large multifamily buildings are more likely to have central water heating than small buildings with
relatively few units. RECS data confirmed this correlation based on the number of households that
obtain domestic hot water from boilers or heaters that serve multiple units. While about 40-50 percent
of buildings with five-to-fifty units have central water heating, 80-90 percent of buildings with over 100
units receive domestic hot water from central boilers.60 RECS data also showed that buildings with
master-metered electricity are more likely to use central water heating.
Electricity Metering
Only a certain percentage of multifamily buildings are master-metered for utility electricity. With
master-metered buildings, electricity from the CHP system can be delivered to individual tenants.
According to RECS data, less than 20 percent of multifamily households pay for electricity through rent
or condo fees, indicating that their buildings are master-metered. However, this value is skewed by the
large number of small multifamily buildings with less than 50 units. When paired with the associated
building size, there is a clear trend towards larger apartment buildings having master-metered
electricity.61 The correlations between building size, master-metered electricity, and central water
heating are shown in Figure 17.
60 Energy Information Administration (EIA). Residential Energy Consumption Survey (RECS). 2009.
61 Ibid.
40
-------
4,0 Quantifying the Opportunities for Multifamiiy CHP
1.1 GW of potential, more than half of the U.S. total. This shows that multifamiiy CHP potential follows
more populous states with large urban areas.
Table 11. Achievable Technical Potential (MWj for Direct-Metered Multifamiiy Buildings with Central
Water Heating {Electric Sizing for Common Areas Only)
Census Division
100-199
Units
200-299
Units
300-499
Units
500-799
Units
>800
Units
Total
Capacity
(MW)
East North Central
12
13
7
2
1
34
East South Central
18
2
1
0
0
20
Mid-Atlantic
62
15
11
4
2
95
Mountain
7
1
1
0
0
9
New England
12
2
1
0
0
15
Pacific
32
9
4
1
0
47
South Atlantic
37
16
8
1
0
62
West North Central
9
1
0
0
0
11
West South Central
11
17
5
1
0
34
Total U.S.
199
77
37
10
4
327
Technical Potential for
Multifamiiy CHP
~ <10 MW
~ 10-20 MW
~ 20-40 MW
~ 40-100 MW
~ >100 MW
Figure 18. Achievable Technical Potential for Multifamiiy CHP by State
43
-------
4.0 Quantifying the Opportunities for Multifamily CHP
cooling electric load. For direct-metered buildings, systems are sized to the average electric load for
common areas only. The second sizing strategy is sizing the CHP system to cover DHW loads, ensuring
full thermal utilization and high operational efficiency, but severely limiting the CHP system size. Due to
the higher efficiency, economics may be more favorable for the smaller DHW-sized option.
Absorption chillers, which can convert thermal energy into chilled water for space cooling, have been
implemented in some multifamily installations, typically in areas with high peak summer electricity
pricing. They are best evaluated on a case-by-case basis. For a high-level economic analysis based on
state average prices, traditional CHP systems without cooling were found to be more economical than
absorption chiller options, due to the additional equipment and installation costs associated with
chillers.
While natural gas access can vary across the country, most multifamily buildings are in urbanized areas
with widespread access to natural gas. For that reason, natural gas access is often considered a
prerequisite for economic CHP installations. The majority of commercially available CHP equipment is
designed for natural gas, and over 99 percent of current multifamily CHP installations use natural gas as
a fuel. Based on this statistic, the economic analysis assumed all CHP units use natural gas as a fuel, and
that all multifamily buildings that can support CHP will have access to natural gas.
Economic Potential Assumptions
To estimate economic potential for multifamily building CHP installations, the achievable technical
potential was combined with CHP cost and performance characteristics, and CHP operating and thermal
utilization assumptions. Two CHP technology options were the basis for these assumptions: 1)
reciprocating engines, and 2) microturbines. These are the two most common CHP technology options
for the size ranges appropriate for multifamily buildings.
Microturbines offer quiet operation, lower emissions, and lower maintenance costs compared to
reciprocating engines. Reciprocating engines, however, offer a higher electric efficiency and a lower
installed cost. The higher efficiency and lower installed cost led to engines being the more economical
option for this analysis. Additionally, engines have a higher electric-to-thermal ratio for CHP efficiency,
which is a better fit for typical multifamily building loads. Both microturbines and reciprocating engines
are offered as packaged CHP systems, which simplify and facilitate installation, and can be an ideal fit for
multifamily buildings.
Equipment Cost and Performance
Data collected for the EPA's 2017 Packaged CHP Systems addition to the Catalog of CHP Technologies
was used for equipment cost and performance in the economic analysis.64 The CHP size breakdowns,
associated equipment, and key cost and performance characteristics are shown in Table 12.
64 U.S. Environmental Protection Agency, Combined Heat and Power Partnership. Catalog of CHP Technologies.
September 2017. https://www.epa.gov/chp/catalog-chp-technologies
45
-------
4.0 Quantifying the Opportunities for Multifamily CHP
Energy Costs
Energy costs were based on 2016 annual state averages from the Energy Information Administration
(EIA).65 For electricity costs, the average commercial rate for electricity was used, with the assumption
that 90 percent of the retail rate can be avoided with CHP electricity. This avoided electricity rate
percentage is meant to account for fixed charges, time-of-use rates, demand charges and other rate
components that may not be avoided with on-site power generation. Using average state commercial
electricity prices will provide a conservative estimate for CHP project economics, because electricity
prices in high-density urban areas - where multifamily buildings are found - tend to be higher than
those in rural areas and therefore tend to be higher than statewide average.
For natural gas, average commercial prices tend to represent typical rates for customers with seasonal
gas loads. The state average commercial gas price, as reported by EIA, was used to represent the typical
natural gas price for multifamily building customers Installing a CHP system results in a consistently high
volume of gas purchases, and gas utilities may offer lower rates, either through tariff rate structures or
negotiation with the customer. In this analysis, the cost of gas for a CHP customer is reduced 10 percent
compared to the cost of gas prior to the CHP installation.
Economic Potential Results
Simple payback periods were calculated using the assumptions described in the previous sub-section for
each of the multifamily buildings identified to have achievable technical potential for CHP (section 4.2).
Facilities that could obtain payback periods of less than 10 years were considered to have economic
potential for CHP. For certain locations and building sizes, the strategy of sizing to electric loads and
using available thermal energy for both DHW and space heating produced favorable economics.
However, this strategy results in less efficient operation compared to sizing CHP systems to DHW loads.
Many multifamily buildings showed stronger economics for a smaller CHP system sized to efficiently
cover DHW loads. In this analysis, for a given building, if both sizing strategies resulted in a favorable
payback period, the larger sized CHP system was selected to estimate the total economic potential.
The map in Figure 20 shows which states can support multifamily CHP projects with payback periods less
than 5 years, 7 years, 10 years, and 15 years. This represents the lowest estimated payback period for
multifamily CHP in each state, which may only be achievable for specific building sizes and/or CHP sizing
strategies.
65 U.S. Department of Energy, Energy Information Administration. Data accessed January 2018.
47
-------
4.0 Quantifying the Opportunities for Multifamily CHP
Based on this analysis, multifamily CHP installations have the potential to significantly reduce carbon
dioxide-equivalent emissions compared to installations with separate heat and utility power, with over
400 thousand tons per year estimated to be able to be avoided in buildings that have economic
potential for CHP.
On-site CHP systems are more efficient than separate heat and utility power due to the elimination of
transmission and distribution line losses from utility electricity and the utilization of captured thermal
energy. Baseload CHP systems fueled by natural gas tend to displace energy that would be produced by
a mix of fossil fuels at central utility plants, and the higher efficiency of CHP can lead to significant
reductions in carbon dioxide equivalent emissions.
When CHP systems are sized according to the electric load in multifamily buildings, the thermal energy
from CHP may not be fully utilized. In the analysis, 60-80 percent thermal utilization was estimated,
depending on whether the systems were sized for full building loads or common areas only for direct -
metered buildings. This can reduce the positive emissions impact compared to applications with higher
thermal utilization. Additionally, utility fossil fuel grid emission levels can vary considerably depending
on region and fuel mix. These factors were considered when estimating the potential carbon dioxide
equivalent emissions impact for multifamily buildings with economic potential for CHP.
51
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
5,0 Oppcitunitiis and Ch^ieng^s in vifarf>iiv CH-
P ro act Deve^O'n-e-yr
To gain an understanding of the opportunities and challenges for CHP installations specific to the
multifamily sector, a review of existing relevant literature was conducted and supplemented with
insights gained through phone interviews with several industry stakeholders. Relevant literature consists
of publicly available research reports, project case studies, and news articles related to the development
of CHP in multifamily buildings. Interviewees included owners of multifamily buildings, developers of
CHP projects with experience in multifamily buildings, project financiers, technical assistance providers,
and policy advocates for CHP in the multifamily sector.
There are opportunities and challenges that apply to CHP installations across the commercial and
institutional sectors.67 CHP has the potential to cost-effectively improve energy efficiency, reduce
emissions, and provide resilience to host facilities. However, there are many site-specific factors that can
influence the effectiveness of CHP including system sizing, operational efficiency, utility grid emissions,
and local energy prices. These factors were considered and evaluated earlier in this report with an
analysis of CHP sizing relative to multifamily building energy loads (Chapter 3) and an evaluation of
economics and potential emission savings for CHP in multifamily buildings (Chapter 4). In this chapter,
the perception of CHP opportunities and challenges in the multifamily sector are explored from several
different perspectives.
Existing literature on CHP in multifamily buildings is not extensive, but some information is available.
The US Department of Housing and Urban Development (HUD) and US Department of Energy's (DOE)
Oak Ridge National Laboratory collaborated to create three CHP guides to identify important
considerations and help building owners navigate the process of installing CHP.68 In addition, HUD
included considerations related to CHP in a toolkit to help integrate renewable energy in affordable
housing.69 Most recently, the DOE's CHP for Resiliency Accelerator produced several resources to
support consideration of CHP solutions at critical infrastructure, including a CHP for Resilience Site
67 EPA and DOE. "Combined Heat and Power: A Clean Energy Solution". August 2012.
https://www.energy.gov/sites/prod/files/2013/ll/f4/chp clean energy solution.pdf.
68 HUD and DOE. "CHP Guide #1 Q&Afor Multifamily Housing". September 2005.
https://www.hud.gov/sites/documents/CHPGUIDEl.PDF: "HUD CHP Guide #2: Feasibility Screening for CHP in
Multifamily Housing". May 2009. https://www.energy.gov/sites/prod/files/2013/ll/f4/chpguide2.pdf: "HUD CHP
Guide #3: Introduction to the Level 2 Analysis tool for Multifamily Buildings". September 2010.
https://www.energy.gov/sites/prod/files/2013/ll/f4/chpguide3.pdf.
69 HUD Community Planning and Development (CPD). "Renewable Energy Toolkit for Affordable Housing".
https://www.hudexchange.info/resources/documents/Renewable-Energy-Toolkit.pdf
52
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
Screening Tool.70 The tool provides an individual site screening assessment for CHP based on a variety of
user inputs, including metrics specific to multifamily buildings.71
More than 20 detailed case studies of CHP in multifamily buildings were collected and reviewed to gain
insight on the project development process and system performance for current CHP installations.72 The
majority of available data comes from installations in New York, primarily New York City, due to the
success of NYSERDA's CHP Program and targeted outreach campaign. NYSERDA's CHP Program provided
tools to help building owners overcome challenges and measure CHP system performance.73
Additional information was gained through phone interviews conducted with industry experts that have
knowledge of CHP and the multifamily sector. Stakeholders were identified for interviews based on a
review of existing multifamily CHP installations as well as knowledge of CHP policies and incentives in
this sector.
In total, seven interviews were conducted in March 2018, each providing a unique point of reference for
how multifamily CHP opportunities and challenges are perceived. Results and insights from these
interviews and case studies are incorporated into this chapter to highlight the opportunities and
challenges for multifamily CHP as viewed from these four different perspectives. Overall, four different
stakeholder perspectives were considered:
• Owners of multifamily buildings
• CHP project developers and financiers
• Policy advocates for CHP in multifamily buildings
• The low-income and affordable housing sector
Literature reviewed and interviews conducted for this report suggest a close alignment between the
potential benefits of combined heat and power in multifamily buildings and the goals of many
multifamily building owners: cost savings, improved environmental outcomes, improved resilience in
the face of storms and natural disasters, and the social benefits deriving from these. Yet despite this
alignment, multifamily building owners are not driving demand for CHP in multifamily buildings.
For owners, the barriers to CHP implementation are diverse and multi-layered, ranging from simple lack
of knowledge, to economics and decision-making, to financing barriers. In a present-day snapshot of the
70 US DOE. CHP for Resiliency Accelerator, https://betterbuildingsinitiative.energy.gov/accelerators/combined-
heat-and-power-resiliency
71 US DOE. CHP for Resilience Site Screening Tool.
https://resilienceguide.dg.industrialenergytools.com/CHPscreener
72 NYSERDA. "Case Studies and Feature Articles, Technology, Combined Heat and Power."
https://www.nvserda.nv.gov/About/Publications/Case-Studies-and-Features
73 New York State Energy Research and Development Authority (NYSERDA). Distributed Energy Resources
Integrated Data System, https://der.nvserda.nv.gov/
53
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
owner perspective on CHP, the challenges appear to outweigh the benefits. But a few NYSERDA case
studies74 suggest that this balance, given the right factors, could tip towards greater owner demand for
CHP, especially considering that resilience is a primary emerging benefit for multifamily building owners.
Owner Challenges and Opportunities
For owners, the following factors represent both a challenge and an opportunity:
• Knowledge of CHP and the decision-making process in considering CHP
• The economics and financing of CHP
• Resilience to extreme weather conditions
Knowledge and the Decision-making Process
As discussed in Chapter 2 of this report, there are various types of multifamily building owners. A basic
division, for purposes of the present discussion, can be drawn between owner-occupants and owner-
managers with renter-occupants.75 For all owner types, common influences for considering CHP are (1)
a favorable spark spread and positive economic return; (2) the need for upgrades to an existing central
system; (3) the availability of public-sector financial incentives for CHP; (4) the availability of CHP vendor
and contractor expertise, and; (5) owner familiarity with or recognition of the benefits of CHP.
In the realm of owner-occupants, partnering with an engaged and knowledgeable board or management
company is one of the top critical factors of success for a CHP multifamily project. Condominium or
cooperative boards are comprised of unit owners who may or may not have engineering knowledge or
prior experience of technical issues related to building systems and efficiency measures. Owner
motivation understandably may begin with the wish for reductions in operating costs and increases in
human comfort and environmental stability. But the learning curve towards CHP implementation,
according to interviewees for this report, is comparatively steep. Where implemented, as in the example
of The Brevoort apartment building in New York City, owner board members included engineers and
members who, in filmed testimony, described their awareness of the polluting effects of conventional
heating fuels such as fuel oil number 6 even before New York City policy mandated the switch to
alternative fuel sources.76 Another potential challenge can be political complications of governing
boards of owner-occupants. Stakeholders may ask themselves, "Do we have a champion on board? Can
a small community of people oppose or stop the project from going forward?"
The decision-making process of owner-managers with renter-occupants is less hampered by internal
politics. Here, owners can directly engage with CHP contractors without the need for board consensus
or a lengthy approval process. Indeed, in the case of all ownership types the availability and involvement
74 New York State Energy Research and Development Authority (NYSERDA). "Case Studies and Feature Articles."
https://www.nvserda.nv.gov/About/Publications/Case-Studies-and-Features
75 This report does not analyze how more various and minutely-differentiated ownership "types" affect owner
willingness to adopt energy efficiency measures - for example, in the case of owners of large, property-managed
portfolios.
76 Tecogen. "The Brevoort Condo Co-op in NYC (Technical) Powered by Tecogen Cogeneration". April 10, 2013.
https://voutu.be/OzJJVL-aMhE
54
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
of expert CHP vendors and subcontractors is key to the success of CHP implementation in the case.
These experts tend to cluster in political jurisdictions where policy and public sector financial incentives
for CHP exist, such as New York State and the Commonwealth of Massachusetts. Yet even with
favorable policy conditions, stakeholders interviewed reported that the decision-making and education
process takes longer with multifamily clients than with other clients, such as those in the industrial
sector, who are steeped in technical knowledge of energy systems and environmental regulation and
thus understand the benefits of CHP after the first or second meeting. In the multifamily sector, the
decision-making process can take several months or years.
CHP Economics and Financing
From an owner's perspective, the underlying project economics are the strongest predictor of CHP
implementation, and a strong financial case is often linked to the presence of high utility rates and the
availability of public sector incentives and/or financing. Low prices for natural gas have made CHP
attractive to many owners on a purely economic basis. Owners' awareness of the need for increased
urban resilience -- the ability to reduce risk and provide a haven during storms - may lead to more
widespread implementation of CHP retrofits in multifamily buildings with shared energy systems.
According to one stakeholder with experience in New York State, there are places outside of New York
City with many multifamily buildings (Syracuse, Rochester, Buffalo, and Albany) that could be candidates
for CHP, but these areas still do not see signs of strong activity, primarily because of economics. While
the economic comparison is still positive in upstate New York, the strongest case for CHP in multifamily
buildings is in New York City due to higher electricity prices and a larger spark spread, greater awareness
of incentive availability, the amount of the incentive ($l,500+/kW), and NYSERDA's reassurance that the
vendor has been vetted.
As much as incentives may open the door to CHP for owners, debt or lack of reserve funds may close it.
Mortgage consent can be a significant barrier to CHP implementation. According to a project financier
interviewed for this report, lenders typically will be required to identify collateral for loans they make. In
their words, "most coops or multifamily rentals have a mortgage on the building and financiers typically
need to get consent for undertaking the project or using collateral from the mortgage lender... for
example, building owners may have an agreement with their mortgage lender that, if they're going to
take on a project more than $3 million, consent is needed to ensure the building won't be in jeopardy of
[defaulting on] mortgage payments." In general, according to the interviewee, most multifamily
buildings do not have proper reserve funds set aside and do not have money or resources to finance
necessary upgrades.
Finally, consideration of other potential energy efficiency upgrades that can be made in the building is
another important factor enabling optimal sizing of CHP systems, so that owners make the right size
investment upfront and experience the greatest cost savings after the system is installed.
55
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
Resilience to extreme weather conditions
For owners, economic returns of CHP may be a prime driver, with environmental benefits second. In
geographies vulnerable to storms or climate change, CHP's social benefits are beginning to emerge.
According to one interviewee, resilience is of great
interest to people in areas where they feel resilience is
needed, especially when they consider that back-up
generators can fail after six hours. While most buildings
currently rely on diesel generators when the electric
grid goes down, many facilities including multifamily
buildings have installed CHP to solve some of the
challenges with traditional approaches to back-up
generation. CHP systems can be equipped to ensure
uninterrupted power to critical loads during
unexpected outage events, which provides safety and
security to tenants.77
New York City's The Brevoort is a case study in the
triple bottom line (economic, environmental, and
social) benefits of installing CHP. Partly motivated by
New York State and City policies away from the use of
fuel oil and towards clean energy, the cooperative
board of The Brevoort apartment building on Fifth
Avenue in lower Manhattan converted their heating
system, which had been using 185,000 gallons of no. 6
oil per year, to a CHP system running on natural gas.
The cost to implement was $3.2 million;78 with
$300,000 per year realized in cost savings.79
When in 2012 Superstorm Sandy knocked out the
utility grid in lower Manhattan, the retrofit revealed the protective, social benefits of CHP. The
Brevoort's CHP system could supply its residents with heat, water, and electricity (essential also for
elevator conveyance, a near-necessity in high-rise buildings) making it one of the few buildings in
77 For more information on five multifamily buildings that remained operational with CHP during Hurricane Sandy,
see U.S. Department of Energy (DOE), the U.S Department of Housing and Urban Development (HUD), and the U.S.
Environmental Protection Agency (EPA), "Guide to Using Combined Heat and Power for Enhancing Reliability and
Resiliency in Buildings". September 2013. https://www.epa.gov/sites/production/files/2015-
07/documents/guide to using combined heat and power for enhancing reliability and resiliency in building
s.pdf
78 Zimmer, Amy. "5 Ways to Green Your Building and Get Money to Do It". DNA Info. July 16, 2014.
https://www.dnainfo.com/new-vork/20140716/midtown/5-wavs-green-vour-building-get-monev-do-it/
79 Real Estate Weekly. "Greenwich Village co-op The Brevoort embraces clean energy." July 6, 2016. https://rew-
online.com/greenwich-village-co-op-the-brevoort-embraces-clean-energv/
"/ know that if ConEdison fails, that this
building will not. I know that I don't have to
worry about people who are 80 or older
climbing multiple stairs to get to their
apartments. I don't have to worry about
anybody not having water. So for me
personally, the cogen system is really a
safeguard and it gives me, as the president
of this board, a tremendous piece of mind."
Diane Nardone, Board President,
The Brevoort
[ ^ mm
Source: Tecogen, Inc. "The Brevoort Condo Co-op in
NYC Powered by Tecogen Cogeneration." April 10,
2013. https://www.voutube.com/watch?v=-
SlbcNG cQY. Photo Credit: Real Estate Weekly.
56
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
continuous operation during this widespread disruption. Normal building occupancy is 720 people;
during Sandy, occupancy increased to 1,500 as residents opened their homes to family and friends
without power or water. Studies have documented the advantage of CHP, when designed for reliability,
over backup generators in cases of grid outage: natural gas lines tend to be stable infrastructure for fuel
supply; CHP provides for both thermal (heating and/or cooling) and electricity needs; CHP, as it operates
continuously, does not experience lag times in start-up; and CHP has markedly lower emissions than
diesel generators.80
The potential deployment of hybrid CHP systems using rooftop-mounted photovoltaic (PV) panels and
energy storage as the basis of an even cleaner and more resilient energy system than natural gas-
powered CHP alone -- is a further, yet-unrealized, and potentially powerful future for energy generation
in the multifamily sector. The addition of PV and energy storage technologies may provide an improved
value proposition compared to stand-alone CHP systems, considering additional emissions reductions
and the potential to participate in utility markets. Similarly, the addition of CHP to solar and storage
systems can significantly increase resiliency benefits. More information about the use of distributed
generation technologies for resilience and to screen individual multifamily building sites for resilience
and CHP can be found in the Individual Site Assessment Tools (DOE Distributed Generation for Resilience
Planning Guide).81
Several entities besides building owners are usually involved in the development of CHP projects. In
some cases, the building owner will hire an engineering consulting firm to help with planning and
managing the project. Another approach is to contract with a turn-key CHP developer, who will design,
develop, and build the project themselves and hand ownership over to the building owner after the CHP
system is operational. Or, the building owner may choose to partner with a third-party investor or other
firm that forms a team to finance and develop the project under a variety of potential ownership
arrangements.82 In either case, the developer could face challenges including the need to educate
building decision makers on CHP technologies and the potential benefits of a CHP installation. In this
section, the opportunities and challenges for multifamily CHP are considered more broadly from the
perspective of a project developer.
80US HUD, US DOE and US EPA. Guide to Using Combined Heat and Power for Enhancing Reliability and Resiliency in
Buildings. September 2013. https://www.epa.gov/chp/guide-using-combined-heat-and-power-enhancing-
reliabilitv-and-resiliencv-buildings
81 US DOE. Distributed Generation (DG) for Resilience Planning Guide. 2019.
https://betterbuildingsinitiative.energy.gov/sites/default/files/attachments/DG%20for%20Resilience%20Planning
%20G uide%20-%2Qreport%2Qformat. pdf.
82 For more information, see EPA, "CHP Project Development Steps", https://www.epa.gov/chp/chp-proiect-
development-steps.
57
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
Multifamily CHP Opportunities for Developers
The interests of third-party developers are primarily centered on the technical and economic viability of
a project. From this perspective, the economic viability of any potential CHP system is the primary driver
of a successful project, and the system's economic viability is fundamentally linked to its technical
design. When designing a CHP system, historical data on electric and thermal energy use helps identify
the optimal equipment for expected power needs and availability of data is critical. In multifamily
buildings, information on electricity consumption tends to be readily available, but data on thermal
consumption is less monitored and measured.
The most efficient CHP systems, and typically the best financial return, are produced when CHP systems
are sized to meet the building's thermal loads. This requires accurate temporal data for hot water and
space heating loads, which can be difficult to obtain. For new construction, more conservative estimates
may be used for sizing since developers work from forecasted loads instead of measured data.
Developer Challenges for Multifamily CHP
The biggest challenge for developers of CHP in multifamily building space is identifying building
candidates with a strong technical fit and a good economic case. One strategy for increasing the viability
of CHP is to take advantage of economies of scale and serve heating loads of multiple buildings. For
example, a 300 kW CHP system serves the nine-building multifamily complex at Roosevelt Landings,
achieving an economy of scale that lowers energy costs, reduces C02 emissions by approximately 1,600
tons per year, and provides resilience through "black start" capabilities.83
Including multifamily buildings in a larger CHP project with a mix of commercial buildings can create a
new set of challenges in coordinating between multiple stakeholders and building owners, but it can
also provide benefits related to CHP sizing, operational efficiency, and economies of scale. A recently
announced 13.2 MW CHP project at Hudson Yards, the largest private real estate project in the US, will
serve two multifamily residential towers with a mix of commercial building space including offices and a
hotel. Mixed-use buildings can provide higher, more consistent loads throughout the day during times
when residential units are mostly unoccupied, which leads to greater system efficiencies and more
favorable project economics. These types of developments can also lead to additional drivers for CHP
uptake. For example, one of the reasons the developers of Hudson Yards pursued CHP was for its
environmental benefits and the installation assisted with achieving LEED certification for buildings
within the complex.84
After a promising candidate has been identified based on building loads and local energy prices, most of
the potential barriers to developing CHP in a multifamily building are not profoundly different from
barriers experienced in other sectors. The kinds of regulatory issues than can arise, such as
83 New York State Energy Research and Development Authority (NYSERDA). "Case Studies and Feature Articles,
Technology, Combined Heat and Power". https://www.nvserda.nv.gov/About/Publications/Case-Studies-and-
Features
84 Hudson Yards New York. "Ten Hudson Yards Designated LEED Platinum." January 2, 2018.
https://www.hudsonvardsnewvork.com/press-releases/ten-hudson-vards-designated-leed-platinum/
58
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
interconnection delays, confusing utility standby rate charges, and time-consuming permitting approvals
are relatively common across any commercial or institutional CHP project. Similarly, the need to have a
good team in place that can leverage engineering expertise, bring relationships with established
vendors, and provide quality service and maintenance over the life of the system are all typical aspects
of CHP development.
Educating the Building Owner
CHP developers in the multifamily sector may uniquely experience certain issues, especially around the
need to educate the building owner. It is often up to the developer to demonstrate the CHP value
proposition. Educating the multifamily client about a large, capital, construction project can take more
time than it does in other sectors, which may have more internal engineering capabilities or experience
with large-scale energy projects. This education process can result in longer timeframes for decision
making that can take several months or even years, particularly when working with rental buildings
owned by large rental companies or co-ops where the co-op board membership might change annually.
According to one project developer, "It just takes time. It isn't the kind of thing where someone just
goes and buys a cogeneration plant. It's a construction project and it takes time to educate people."
Some of the most successful CHP installations at multifamily buildings have been led by invested and
engaged cooperative boards with members that are savvy in the financing and engineering
requirements for large construction projects. Additionally, most building owners and board members
can easily relate to the resilience benefits of CHP, and this can be one of CHP's greatest selling points
from the perspective of a project developer during the education process.
To overcome educational barriers with multifamily stakeholders in New York, NYSERDA prioritized
education and outreach and developed innovative opportunities to engage with potential CHP hosts.
This included inviting building owners to attend breakfasts, participate in site tours, and talk with other
building managers about their experiences with CHP. Potential CHP hosts could hear their peers explain
what the process is like and ask questions about their main concerns. Participants are interested in
learning things like, "How much of a resource drain was it?" "Was there discomfort during the process
for tenants?" These actions by developers can help building owners be a part of community, learn from
peers, and gain confidence in CHP project options.
A policy environment that supports CHP deployment is consistently present in areas where CHP is used
in multifamily buildings. Many multifamily CHP projects have had access to some type of incentive,
financing assistance, or technical support through state or utility-administered programs aimed at
encouraging CHP. These policies or programs are not typically targeted specifically to the multifamily
sector, but more often prioritize the use of CHP in applications that effectively achieve broader public
policy goals such as encouraging energy efficiency and economic development, increasing the resilience
of critical facilities, and improving the environment and reducing GHG emissions.
59
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
NYSERDA's CHP Program
In New York, CHP plays a clear role in supporting several the state's policy objectives, including the
governor's strategy to build a cleaner, more resilient and affordable energy system known as Reforming
the Energy Vision. NYSERDA's CHP Program (PON 2568) incentivized the installation of CHP and was one
of the most successful programs in the country at encouraging CHP in the multifamily sector. During a
four-year term (2014-2017) of its first-come, first-serve CHP Program for all sectors, NYSERDA issued
purchase orders in support of 129 CHP projects, of which 102 were located at multifamily buildings (or
mixed-use buildings presumed to be typical of NYC marketplace consisting of ground-level commercial
with upper-level multifamily residential) for an aggregated capacity of more than 25 MW.85 In order to
receive an incentive, in almost all cases systems were required to be capable of independent operation
during grid outages ("black-start capable"), and installed to provide priority power during grid outages.86
One of the main reasons for NYSERDA's programmatic success in multifamily buildings is its catalog
approach for packaged CHP systems, which allowed customers to easily select from a set of pre-
engineered CHP modules supplied by approved CHP vendors. NYSERDA's catalog included components
to educate the consumer about CHP and provided a rule of thumb for CHP sizing (100 kW for a 300-unit
building) to place CHP's use in an easy-to-understand concept. The approved vendors act as a single
point of responsibility for the entire project and provide a five-year maintenance and warranty
agreement on the CHP system.87 This approach improves buyer's confidence, ensures vendors are
experienced at delivering projects, and simplifies the process for multifamily stakeholders that may be
less familiar with large capital projects than buyers in other sectors.
Environmental Policies
Environmental policies at the local level can also be a contributing factor to the growth of CHP in
multifamily buildings, which was the case in New York City. In 2011, a rule known as "Local Law 43,"
required buildings in New York City to replace No. 6 heating oil with cleaner grades of heating oil and
eventually phase out their use for natural gas.88 The law prompted some multifamily building owners to
consider replacing existing boilers with CHP to comply with the regulation. For example, Stevenson
Commons, an affordable housing community located in The Bronx, NY began exploring CHP as an option
for compliance with the law and in 2012, installed a 525 kW CHP system in partnership with a third-
party developer. The developer owns and operates the system, allowing Stevenson Commons to keep
85 Levy, Dana. New York State Energy Research and Development Authority (NYSERDA). Personal communication.
April 24, 2018.
86 US DOE, Better Buildings Initiative. "CHP for Resiliency Accelerator Partner Profile: NYSERDA".
https://betterbuildingssolutioncenter.energy.gov/sites/default/files/attachments/NYSERDA.pdf
87 New York State Energy Research and Development Authority (NYSERDA). Combined Heat and Power Program,
PON 2568 Summary, CHP Sizing Guidelines. http://nvserda.nv.gov/PON2568
88 The City of New York. Local Laws of the City of New York for the Year 2010. No. 43.
http://www.nvc.gov/html/gbee/downloads/pdf/ll43-2010.pdf
60
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
energy costs down for tenants and comply with the rule
without a large upfront capital outlay or ongoing
maintenance expenses.89
Policy initiatives in other parts of the country have also
successfully encouraged CHP in multifamily buildings. A
combination of CHP programs in Massachusetts, which are
aimed at increasing energy efficiency and reducing the need
for conventional power generation in the Commonwealth,
supported installations in at least four multifamily buildings
in 2016.90 The Alternative Energy Portfolio Standard,
administered by the Department of Energy Resources
(DOER), provides $/kWh production incentives for CHP and
has streamlined administrative procedures so that smaller,
multifamily-sized projects can take advantage without
burdensome reporting requirements. CHP projects at
multifamily buildings can also qualify for a $/kW capital
incentive through a utility-administered program, which
allows the utility to track energy savings from CHP projects
and count them toward their energy efficiency targets.
Utility Policies and Incentives
Policy makers in Maryland have taken a similar approach
and encourage the use of CHP as an important part of
utilities' strategy for reaching the reductions in energy
consumption required by the EmPOWER Maryland
initiative. CHP installations at two multifamily buildings are
benefitting residents while also helping utility company
PEPCO (Potomac Electric Power Company) achieve its
savings target. Multifamily customers may also qualify for
grant funding through the Maryland Energy
Administration's CHP Grant Program, which complements
the utility-provided incentives and encourages CHP for
resilience at critical infrastructure facilities. In general, states that have seen greater CHP deployment,
especially in harder-to-reach sectors such as multifamily buildings, tend to include utilities as dedicated
partners that can also benefit from CHP installations.
In the future, as more utilities gain experience collaborating with customers on CHP, programs may
evolve to achieve specific goals for the electric distribution grid. For example, through the Brooklyn
89 Aegis. "Stevenson Commons." https://aegischp.com/casestudv/stevenson-commons/
90 Commonwealth of Massachusetts. "Program Summaries: Summaries of all the Renewable and Alternative
Energy Portfolio Standard Programs." https://www.mass.gov/service-details/program-summaries
Utility Incentives for CHP in
Multifamily Buildings in Maryland
To achieve statewide energy
efficiency goals, Pepco, a public utility
serving customers in Maryland and
Washington, DC has partnered with
multifamily building owners and
provided incentives for CHP systems
at two sites in Chevy Chase, MD.
n
A 75-kW system provides electricity
and hot water at the Wisconsin Place
Apartments (above) and a 150 kW
system powers the 4701 Willard
Apartments (below).
Photo credit: Equity Apartments
61
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
Queens Demand Management (BQDM) program, New York's largest electric utility, ConEdison, offers
incentives to projects that include CHP and reduce demand in a targeted area in order to avoid a $1.2
billion substation upgrade. Facilitated in partnership with NYSERDA, the utility and state agency have
supported several customer-sited CHP systems at multifamily buildings with an emphasis on the
system's ability to relieve load in a targeted location during a specified period (summer peaking hours).
As more utilities invest in low-cost alternatives to traditional grid infrastructure, CHP systems at
multifamily buildings may be well-positioned to provide value at times and locations where the electrical
grid needs it most.
Since 2000 and the establishment of its CHP Demonstration Program, the NYSERDA has offered CHP-
related support and incentives, with by far the greatest proportion of implemented projects in the
multifamily and hospitality sector.91 Of a collection of fifteen representative NYSERDA case studies of
CHP in multifamily buildings,92 six, or 40%, have focused on CHP-powered affordable multifamily
buildings in New York City. NYSERDA's case studies on affordable multifamily buildings could suggest
that, where the availability of financial incentives and technical support intersect, the affordable
subsector of the multifamily building market may be ready and willing to adopt CHP. These installations
also provide greater resilience for populations that might be adversely affected by power outages.93
Low-income and affordable housing has several key characteristics that appear favorable for CHP
installation. This sector encompasses predominantly rental housing; thus, owners, whether public
sector, non-for-profit or private-sector, are the decision makers, a contrast to the slower, consensus-
driven process of tenant-run condominium or cooperative boards. If affordable multifamily residential
buildings are master-metered (a desirable precondition for CHP), the owner is likely to pay the utility
costs, recouping these in the tenant's net rent or, in the case of buildings with subsidized rents, from a
utility allowance. Thus, especially in geographies where energy is expensive, owners of affordable
master-metered buildings have a compelling reason to reduce costs to keep their expenditures low and
their rent affordable.
At least two common master-metered affordable housing ownership types could potentially benefit
from CHP implementation. The first type, the most prevalent, is what one expert interviewed for this
report terms "naturally occurring" affordable housing, which is non-subsidized older housing stock.
Owners of these buildings, as for all market-rate properties, are looking for opportunities to reduce
91 Kear, Edward and Mark Gundrum. "NYSERDA's CHP Program: A Little History". New York State Energy Research
and Development Authority (NYSERDA). June 20, 2012.
92 Correspondence between Dana Levy, NYSERDA and Neeharika Naik-Dhungel, U.S. EPA'sCHP Partnership
Program Manager. April 2018.
93 Preliminary analysis in New York City has shown that multifamily buildings at public housing campuses have
more attractive characteristics (large electric and thermal requirements, etc.) that made them better candidates
for CHP than other multifamily building stock. Further exploration of this premise and whether it extends to other
parts of the country is an area for additional research.
62
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
expenses and increase net operating income. CHP implementation, especially in locations where
incentives are present and climate resiliency is a priority, may be appealing. The second type is housing
operated by public housing authorities (PHAs) in which PHAs rather than tenants pay for utilities. PHAs
follow U.S. Department of Housing and Urban Development (HUD) requirements in setting utility
allowances (UAs) for tenants, which become part of the tenant's net rent. According to Evan White's
Utilities in Federally Subsidized Housing, "when the owner pays for utilities, tenants have virtually no
financial incentive to conserve because utility costs, whether great or small, do not affect their monthly
payments."94 In such cases, PHAs operating master-metered buildings under the fixed rent subsidy paid
them by HUD may have incentive to implement energy saving systems like CHP.95 HUD caps tenant rent
at 30% of income, regardless of utility costs; in locations where utility costs are high relative to the
revenue from rent, owners have an incentive to reduce their own costs through energy saving
investments.
While CHP can provide cost-effective energy savings, the economics of CHP installations can be
challenging compared to other energy efficiency measures. First costs for CHP are higher, and without
incentives may be prohibitively expensive. Operating and capital budgets for taxpayer-funded affordable
housing96 tend to be low, so maintenance may be deferred and building infrastructure poor or failing, so
that priorities other than the installation of CHP may be more pressing. According to an expert in energy
efficiency and multifamily buildings interviewed for this report:
"Affordable multifamily housing providers are strapped, both in terms of funding and financing and staff
time and capacity they can devote to thinking about making their buildings more efficient. The ones that
do pay attention to upgrades tend to be on the larger side, with more resources, or they've been
approached by an incentive program to help them incorporate CHP. This is one reason why people are
more familiar with CHP in New York... state incentive programs like NYSERDA's can have a big
impact. "97
State and federal entities have the power to decide whether and how to support energy efficiency in the
affordable multifamily sector. In new construction, states typically have a scoring system to rank
94 White, Evan. Utilities in Federally Subsidized Housing: A Report on Efficiency, Utility Savings, and Consistency.
Goldman School of Public Policy, UC Berkeley Law at Boalt Hall. June 2012.
https://aceee.org/files/pdf/resource/white utilities in federally subsidized housing 2012.pdf
95 Other affordable housing types operating under different subsidy programs with different rules may face
disincentives to implementing energy saving improvements. For example, master-metered affordable housing
properties subsidized using the low-income housing tax credit (LIHTC) are not subject to HUD rules; LIHTC
properties use actual or modeled energy costs to set utility allowances and determine subsidies, and these
increases or decrease as utility costs increase or decrease. This circumstance represents a disincentive to making
energy saving improvements that might be otherwise funded from an increase in net operating income. For a
summary of utility allowances in subsidized affordable rental housing, see California Housing Partnership
Corporation, "An Affordable Housing Owner's Guide to Utility Allowances," April 2016, https://chpc.net/wp-
content/uploads/2016/04/UA-Guide April-2Q16Web.pdf
96 Note that private capital also plays a role in funding affordable housing.
97 Stefan Samarripas, American Council for an Energy-Efficient Economy. March 29, 2018 telephone interview.
63
-------
5.0 Opportunities and Challenges in Multifamily CHP Project Development
Bedford, MA implemented CHP in 2009 for an installed system cost of $197,000 after an
$18,000 utility rebate; with annual savings of $58,000, simple payback was less than four
years."
• Public sector-sponsored lending institutions for green retrofits, such as the Connecticut Green
Bank.
• Building operator training, a need that applies to all multifamily buildings, not just affordable
developments. According to one interviewee, "building staff in general are not very familiar with
advanced technologies and energy savings systems, especially large ones, so you need to train
the staff to be able to operate and maintain the equipment to keep capturing savings.
Opportunities for training building operators could be helpful."
99 New England US DOE CHP Technical Assistance Partnership. "Boa Vista Apartments." June 2015.
http://www.chptap.org/Data/proiects/boavistachp.pdf
65
-------
6.0 Conclusions
reduced on an annual basis.101 As the results show, there are a number of opportunities throughout the
U.S. for CHP to provide energy savings and resiliency for multifamily building tenants and owners while
reducing emissions.
During this analysis, two trends were observed as factors likely to influence market growth for CHP in
multifamily buildings. These are (1) the role of CHP in strengthening the resilience of buildings and
providing capability to island from the grid, and (2) the emergence of hybrid CHP systems that integrate
renewable technologies. CHP is a demonstrated, cost-competitive solution that has enabled residents to
shelter-in-place when faced with extreme weather events in recent years. For that reason, several states
have developed resilience policies and plans that encourage CHP at critical facilities. Looking to the
future, hybrid CHP systems that integrate solar and storage are an emerging strategy for balancing the
resilience needs of the multifamily sector with broader emission reduction goals. Concepts and themes
associated with resilience and hybrid CHP systems are briefly addressed in this report. However, with
the increase in state and local renewable policies and decreasing costs associated with renewable
technologies, this is a topic for further discussion, more detailed analysis, and future research.
101 Results from economic analysis applied to EPA Energy and Emissions Savings Calculator
(https://www.epa.gov/chp/chp-energy-and-emissions-savings-calculator) with modeled CHP performance
characteristics and 2014 eGRID values by sub region (released 2016) for fossil fuel utility emissions.
67
-------
Appendix A: Existing Resources for CHP in Multifamily Buildings
Appendix A: Existing FP^ourc^ forCH3 in VhAAP:x;nip/
AAHAxgi;
Cri^' V:';d fW cin;(!inu
Groberg, R., MacDonald, J.M., & Garland, P. 2008. Promoting Combined Heat and Power for
Multifamily Properties. 2008 ACEEE Summer Study on Energy Efficiency in Buildings.
http://aceee.Org/files/proceedings/2008/data/papers/2 402.pdf.
This whitepaper provides a comprehensive summary of the subject of CHP in multifamily buildings.
It summarizes how to use public tools available for building developers interested in evaluating CHP for
their buildings and reviews several federal support mechanisms created to help facilitate CHP
technology in multifamily buildings.
NYCEEC. Clean Energy Pays Off in the Multifamily Market. A case study from NYCEEC.
https://nvceec.com/wp-content/uploads/Roosevelt-Landings-case-studv-NYCEEC-web.pdf.
This case study describes NYCEEC's experience providing financing for a series of clean energy retrofits
at Roosevelt Landings, a 1,003-unit mixed income apartment complex in New York City. The retrofit,
which included the installation of a 300 kW CHP system, resulted in several lessons learned that may
be relevant for other large and aging multifamily rental buildings.
U.S. Department of Energy (DOE). 2019. Efficiency-Resilience Nexus.
https://betterbuildingsinitiative.energy.gov/resilience
The resources found on this page are intended to help organizations across different sectors
take steps to build resilience and increase their ability to bounce back from natural disasters and other
stressors. These resources can be used to minimize vulnerabilities to climate-related impacts through
resilience planning, implementing new energy technologies, and decreasing energy demand in facilities.
They include a guide that provides information and resources on how DG, with a focus on CHP, can help
communities meet resilience goals and ensure critical infrastructure remains operational regardless of
external events. If used in combination with a survey of critical infrastructure at a regional level, this
guide also provides tools and analysis capabilities to help decision makers, policy makers, utilities, and
organizations determine if DG is a good fit to support resilience goals for critical infrastructure in their
specific jurisdiction, territory, or organization.
U.S. DOE, U.S. Department of Housing and Urban Development (HUD) & U.S. EPA. 2013. Guide to Using
Combined Heat and Power for Enhancing Reliability and Resiliency in Buildings.
https://www.epa.gov/sites/production/files/2015-
07/documents/guide to using combined heat and power for enhancing reliability and resilien
cy in buildings.pdf.
In response to Hurricane Sandy, the U.S. Department of Energy (DOE), U.S. EPA, and Department of
Housing and Urban Development (HUD) developed a guide for using CHP to enhance resiliency in
68
-------
Appendix A Existing Resources for CHP in Multifamily Buildings
buildings. The guide highlights sites that were powered by CHP and continued operations when the
electric grid went down during the storm. Five of the sites were multifamily buildings, which illustrate
the benefits of CHP systems in multifamily buildings during unexpected grid outages.
U.S. DOE. Oak Ridge National Laboratory (ORNL) prepared for HUD. September 2010. HUD CHP Guide
#3: Introduction to Level 2 Analysis Tool for Multifamily Buildings. Available at
https://portal.hud.gov/hudportal/documents/huddoc?id=chpguide3.pdf
The third guidance document from HUD and DOE that explains how a Level 2 Analysis Tool was created
and for whom it is best suited. It is the first analysis tool specifically geared toward multifamily
building owners, managers and developers and is designed to help them determine if CHP is right
for their multifamily building. In addition to determining system cost, payback, and sizing, the Level
2 Analysis Tool can show users other energy conservation measures for their building, like new
windows or chiller/boiler replacement. This feature is helpful for users wanting to combine a CHP
system installation with additional building upgrades.
U.S. DOE. ORNL prepared for HUD. May 2009. HUD CHP Guide #2: Feasibility Screening for Combined
Heat and Power in Multifamily Housing.
https://portal.hud.gov/hudportal/documents/huddoc?id=chpguide2.pdf
The second guidance document created by HUD and introduces the HUD/ORNL Level 2 CHP analysis
tool, as well as other feasibility guidelines for CHP in multifamily buildings. The document provides
screenshots of the tool and examples of some data inputs.
U.S. DOE. ORNL prepared for HUD. 2005. CHP Guide #1: Q&A on Combined Heat and Power for
Multifamily Housing. https://portal.hud.gov/hudportal/documents/huddoc?id=chpguidel.pdf
The first guidance document HUD developed with DOE targeted at CHP in Multifamily buildings. The
first answers key questions about CHP to help educate multifamily building owners and managers. It
reviews the general building specifications that are favorable for CHP and the benefits associated with
converting from conventional power and heat technologies to CHP.
U.S. HUD, Community Planning and Development, Renewable Energy Toolkit for Affordable Housing,
2018.
The U.S. Department of Housing and Urban Development (HUD) developed a toolkit for renewable
energy in affordable housing, which included suggestions for the installation of CHP. The toolkit
recommends multifamily buildings with 100 or more housing units as a screening mechanism for CHP
viability.
Witty, Sam and Gita Subramony. 2016. Roadmap to Distributed Generation: Innovative Tools for CHP
Adoption, https://aceee.org/files/proceedings/2016/data/papers/ll 771.pdf.
This paper describes the methodology behind a market assessment tool used by NYSERDA to
identify New York City buildings that would make ideal candidates for CHP. The tool identifies potential
CHP program participants, including multifamily buildings, and assist participants with navigating the
69
-------
Appendix A: Existing Resources for CHP in Multifamily Buildings
CHP installation process. The tool also provides information on key decision makers at the buildings
identified to facilitate program outreach and includes a preliminary screening analysis of CHP
installations on building loads and operating costs.
New York State Energy Research and Development Authority (NYSERDA). DG Integrated Data System.
Available from https://der.nyserda.ny.gov/.
NYSERDA maintains an online tracking system that monitors the performance of CHP installations
that have taken advantage of available incentives through their CHP program. The data provides details
on how recent multifamily CHP systems have been sized and how they are performing.
US DOE. 2019. U.S. DOE Combined Heat and Power Installation Database, maintained by ICF. Available
at https://doe.icfwebservices.com/chpdb/.
The DOE CHP Installation Database is a data collection effort sponsored by DOE and maintained by ICF.
The database contains a comprehensive listing of CHP installations of all sizes and applications
installed in the United States. Users can sort state-by-state data on all CHP installations located at
multifamily buildings as specified in the "application" field.
US DOE. 2016. Combined Heat and Power Technical Potential in the United States.
https://www.energv.gov/sites/prod/files/2016/04/f30/CH P%20Technical%20Potential%20Studv%2
03-31-2016%20Final.pdf.
This report provides national data on the technical potential for CHP by system size range, facility
type, and location. The study includes an estimate of the market size for CHP in multifamily buildings
constrained only by technological limits, which measures the ability of CHP technologies to fit customer
energy needs without regard for economic or market factors.
US DOE. CHP Technical Assistance Partnerships (CHP TAPS), http://energy.gov/eere/amo/chp-technical-
assistance-partnerships-chp-taps.
DOE's CHP Technical Assistance Partnerships (CHP TAPs) provide market opportunity analyses,
education and outreach, and technical assistance. The CHP TAPs provide targeted outreach and
education about CHP benefits to a variety of stakeholders including policy makers, regulators, energy
end-users, and trade associations through the DOE's CHP Deployment Program.
US EPA. 2015. Combined Heat and Power Partnership, Catalog of CHP Technologies.
https://www.epa.gov/chp/catalog-chp-technologies.
This report provides an overview of how CHP systems work and the key concepts of efficiency and
power-to-heat ratios. It also provides information and performance characteristics of five commercially
available CHP prime movers. Data collected for the 2017 Packaged CHP Systems chapter of the Catalog
of CHP Technologies can be used to estimate equipment cost and performance of systems typical of
multifamily buildings.
70
-------
Appendix A Existing Resources for CHP in Multifamily Buildings
US EPA. Combined Heat and Power Partnership, Is My Facility a Good Candidate for CHP?
https://www.epa.gov/chp/mv-facility-good-candidate-c.
On its website, EPA's CHP Partnership lists a series of initial questions to help users evaluate
whether a facility is a good candidate for CHP. It includes access to additional resources, including an
excel-based tool to estimate the economic feasibility of a CHP project and an online guide of the steps
involved in CHP project development, from initial qualification to CHP system operation and
maintenance.
cr;<-;yy ir Ma,y
Brown, Matthew and Mark Wolfe. 2007. Energy Efficiency in Multi-Family Housing, A Profile and
Analysis. Washington, DC: Energy Programs Consortium. Available at
https://aceee.org/files/pdf/resource/brown and wolfe energy efficiency in multifamily housing
2007.pdf.
This paper describes the number and types of multifamily housing units in the country as a
percentage of the total U.S. housing stock, the income level of those who inhabit multifamily buildings
and whether they rent or own their units. It also describes energy use, evaluates the potential for
energy efficiency in multifamily buildings, and provides a summary of policy issues impacting the sector.
Hynek, D., M. Levy, and B. Smith. 2012. Follow the Money: Overcoming the Split Incentive for Effective
Energy Efficiency Program Design in Multi-family Buildings. Wisconsin Division of Energy Services.
In Proceedings of 2012 ACEEE Summer Study on Energy Efficiency in Buildings. Available at
https://aceee.org/files/proceedings/2012/data/papers/0193-00Q192.pdf.
This paper offers a taxonomy of multifamily buildings and their financial environments. It is intended
to help program designers and evaluators think through program designs and parameters to overcome
the split incentive barrier and design the most effective multifamily building program possible.
Samarripas, S., D. York, and L. Ross. 2017. More Savings for More Residents: Progress in Multifamily
Housing Energy Efficiency. Washington, DC: American Council for an Energy Efficient Economy.
Available at http://aceee.org/research-report/ul702.
This report is an assessment of multifamily energy efficiency programs in US metropolitan areas
with the most multifamily households. The report documents how energy efficiency programs have
changed in the context of dynamic housing markets and statewide policy environments. It includes an
analysis of the number, spending, offerings, and targeted participants of current programs and their
potential for further expansion.
71
------- |