Energy Project Financing : Resources and Strategies for Success

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Appendix B 305


energy savings program. In general:


Energy Savings = Baseyear Energy Use –
Post-Retrofit Energy Use ± Adjustments Eq. 1


The “Adjustments” term in this general equation brings energy use
in the two time periods to the same set of conditions. Conditions com-
monly affecting energy use are weather, occupancy, plant throughput,
and equipment operations required by these conditions. Adjustments
may be positive or negative.
Adjustments are derived from identifiable physical facts. The ad-
justments are made either routinely such as for weather changes, or as
necessary such as when a second shift is added, occupants are added to
the space, or increased usage of electrical equipment in the building.
Adjustments are commonly made to restate baseyear energy use
under post-retrofit conditions. Such adjustment process yields savings
which are often described as “avoided energy use” of the post-retrofit
period. The level of such savings are dependent on post-retrofit period
operating conditions.
Adjustments may also be made to an agreed fixed set of condi-
tions such as those of the baseyear or some other period. The level of
savings computed in this situation is unaffected by post-retrofit period
conditions, but reflects operation under a set of conditions which must
be established in advance.
There are many other considerations and choices to make in de-
termining savings. Chapter 3.4 describes four basic Options, any one
of which may be adapted to a particular savings determination task.
Chapter 4 gives guidance on common issues such as balancing costs and
accuracy with the value of the energy savings program being evaluated.
Chapter 5 reviews metering and instrumentation issues.


3.2 BASIC APPROACH
Proper savings determination is a necessary part of good design
of the savings program itself. Therefore the basic approach in savings
determination is closely linked with some elements of program design.
The basic approach common to all good savings determination entails
the following steps:


1 Select the IPMVP Option (see Chapter 3.4) that is consistent with

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