Energy Efficiency Programs and Evaluation in Europe (And more importantly, an excuse to talk about the World Cup)

I am finally returning after a long hiatus from blogging, and from two weeks in Europe after speaking at the International Energy Program Evaluation Conference (IEPEC).  My talk was on EMI’s work evaluating data center efficiency programs for US utilities. EMI was also a silver sponsor for the event, which was IEPEC’s first conference outside the U.S.. The conference included numerous interesting sessions on methods and challenges in evaluating energy efficiency programs in the U.S., Europe, Australia and China, making it a truly international conference.

The U.S. vs. the Rest of the World

There was an interesting undercurrent at the conference stemming from differences in the way energy efficiency programs are run internationally. In the U.S. evaluation programs tend to focus on utility run programs, which are typically accountable to the goals put on them from state utility commissions. At the federal level, energy efficiency programs in the U.S. do not have the same level of accountability – there are efforts to accurately determine savings but there is not the same focus on independent evaluation to confirm savings.

In the rest of the world, especially in Europe, it seems that programs and evaluation are mostly on the national government level and do not have the same level of accountability that U.S. utilities are subject to by regulators. One of the most interesting sessions at IEPEC was a panel discussion with Paolo Bertoldi of the European Commission and Dian Grueneich, the Lead Commissioner for Energy Efficiency of the California Public Utilities Commission.  The debate revolved around the need for energy savings goals and accountability through evaluation.  Paolo of the EC contended that program goals were unnecessary, that you can create programs that can help people save energy, and then drive them to save energy through other efforts like carbon taxation.  With this approach, and with no goals to meet, there is less need for independent evaluation to determine the impacts of a program.  Commissioner Grueneich, on the other hand, was arguing more for goals and accountability for the money spent on energy efficiency.

I can see Paolo’s argument, but the scientist and engineer in me wants to see real results.  You set up a program on the theory that it’s going to provide energy savings, but until you study it closely you do not know what the savings are actually achieved.  Furthermore, if you do not have good metrics to measure the impacts of the program, how do you know when a program needs improvement or how much it has improved when you make changes?  In practice, there is often a large gap between program theory, implementation and results; evaluators help define and reduce these differences for program designers.  Furthermore, solid process evaluation helps programs find ways to improve its processes, which in turn improve the program impacts.

I have a feeling this debate will continue, but IEPEC deserves credit for bringing this conversation to a truly international stage.  There seemed to be a lot of interest from European participants on learning more about the established evaluation techniques used for U.S. utilities and the development of international evaluation standards, and the success of energy efficiency programs can not but help to improve by the sharing of this information.

So, What Does This Have to Do with the World Cup?

The week after the conference I spent traveling in North East France with a short jump into Germany.  As an avid soccer fan, I spent much of this time sitting in cafes and restaurants watching the World Cup.  During the France v. Uruguay game the streets of Strasbourg were virtually barren and most everything was closed on a Friday night at 7:30 pm.  It seemed as if the French were busy watching quietly at home.  Across the border, in Freiburg Germany, every restaurant had what looked like a brand new TV outside the door so you could sit outside and watch the game, or casual passer-byers could watch the game (sales of flat screens must be through the roof in Germany).  They also had huge screens in some of the public parks for viewing.  After Germany beat Australia 4-0 in their first game, the bars and streets were absolutely mobbed with celebration.  Back in the U.S., things are less intense, but interest in the Cup, and the U.S. National Team seems to be at an all-time high after the U.S.’s great run through the group stage and emotional win on Wednesday.

So What’s the Point?

Theses experiences transposed on each other has driven home the fact that the world is increasingly becoming an international community.  There are large differences in mentalities, traditions and practices around the world, and engagement in the international community, whether through friendly competition or collaboration, helps us understand and learn from our international peers and see things from alternate viewpoints.  I like to feel that international engagement and sharing of information helps everyone involved, so thanks to IEPEC for a great conference, and to FIFA and ESPN for such a great event.

As a side note, IT technology and data centers are two of the tools helping the world participate in these global experiences.  The New York Times reports that ESPN.com’s traffic is up 70% over its traditional annual peak during the final four – another reminder of the explosive growth of internet usage and data center power consumption.  Ok, enough on that.  Spain / Portugal kicks off in an hour – should be a scorcher! Check it out on ESPN3.com.

Key Take-Aways of Colocation Research for Silicon Valley Power

Last fall EMI, under subcontract to Summit Blue Consulting (now a part of Navigant Consulting), performed a process evaluation for Silicon Valley Power (SVP) in Santa Clara California.  The process evaluation focused on identifying barriers to colocation data centers (or “colos”) participating in SVP’s energy efficiency programs.  Colos provide data center infrastructure to support other companies’ IT equipment – basically data center space for rent.  This space can be leased in units as small as half a rack and as big as thousands of square feet.  The latter situation, where whole rooms or even whole data centers are leased to one tenant, are known as “wholesale” colocation facilities.

Santa Clara has a dense concentration of data centers and colocation facilities.  This is largely due to their location in the heart of Silicon Valley, but also is due to their relatively low cost of power and high reliability of their power delivery. As a result of this high concentration, data centers are a main focus of the SVP energy efficiency programs, and in 2007-2008, roughly 60% of SVP’s energy savings came from data center related projects.

EMI conducted this research by performing: online research and a document review of appropriate reports, and in-depth interviews with colo managers from inside and outside SVP’s service territory and other industry experts.  Here are some of the main take-aways from EMI’s research into participation of colocation facilities in SVP’s programs.

• Aggravated Barriers – Since providing reliable data center space is a colo’s main business, some of the barriers to energy efficiency for typical data centers are aggravated in the colocation facilities’ case.  These include an extreme focus on reliability, with little interest in energy efficiency.  It also creates an extreme case of the split incentive, because the people paying the power bill and the IT purchasers work for completely different companies, so there is little motivation to invest in more efficient equipment.
• Pricing Models of Colos Affect Investment in Efficiency– Different colocation companies have different methods for splitting up charges for power, cooling and space.  While data centers become more constrained by power and cooling (and less constrained by space), some colocation facilities are moving away from space-based charges and more towards charging directly for power and cooling, which helps create more of an incentive for their customers to save energy.
• Difficulty in Reaching the Colocation Facilities’ Customers –SVP, like other utilities, is restricted to only offer incentives to their customers of record.  This is necessary as it allows SVP to be able to recoup the incentive amounts if the measure does not stay in place for the contracted five-year period, and therefore the measure does not deliver the full five years of savings SVP claims for the measure.  As a result, SVP cannot give incentives to the colocation facilities’ customers, as these customers do not pay SVP for their power, but instead the cost of power is bundled with their colo charges.  This is a major barrier for many utilities to getting colocation customers to participate in virtualization incentives, for example.
• Lack of Expertise for Completing Calculations – Some facilities indicated that they did not have the engineering expertise on staff to complete the necessary calculations to receive incentives, as operating colos are basically “a couple IT guys with a sales department.” SVP offers support to fill out the applications, but some potential participants were not aware of this, so this was an area where better communication of the program offerings could help increase participation from companies that need this support.

All in all, the evaluation found that SVP’s focus on data centers has been very successful and that they are undertaking a lot of efforts to help overcome these barriers such as: emphasizing new construction where the barriers and inertia to energy efficiency are not as great, and offering technical support where it is needed.  Other opportunities lie in collaborating with other utilities to identify new opportunities (e.g., for prescriptive measures which simplify the application process), and investigating new ways to get to colo customers.  Although there are many barriers in place for colocation facilities, this is a large data center market, it is growing rapidly, and it is worth having progressive utilities like SVP continue to push to develop programs and processes to overcome these barriers.

The full report (available here) offers more detail on the colocation market and barriers to their participation in energy efficiency programs.

Should Utilities Look at Data Centers to Achieve Increasing Efficiency Goals?

The market for energy efficiency is increasing, and more states and Public Utility Comissions (PUCs) are jumping on the bandwagon every day.  But where are these new electricity savings going to come from?

I recently stumbled on this ACEEE report (released in March 2009 and available here) covering the increased energy efficiency goals of many states.  As the paper summary says, “In just the last few years, energy efficiency has evolved from being largely a token gesture or a ‘public benefits’ set-aside, to being a top-priority utility system resource.”  As a result, many states (including Minnesota, Illinois, Ohio, New York, Maryland and Vermont) were increasing their yearly efficiency goals to 1.5% – 2.0% a year, when “the very few top performing states in the nation were only achieving savings in the area of 0.8% per year.”  This fact makes these new savings goals look very aggressive.  In my mind this is a great thing because efficiency is the cleanest and cheapest form of capacity.

There are a few other interesting findings from this report, which reaffirm a couple persistent issues and trends in this industry:

1. “Energy efficiency spending was relatively balanced between the residential and non-residential sectors (median across the states of 44% and 56% respectively), but that savings were relatively skewed toward the non-residential sector (63% non- residential).”
2. “Also striking was the extent to which the lighting end use dominated the savings accomplishments, accounting for nearly two-thirds of all savings in the states which had disaggregated data available.  In the residential sector alone, lighting accounted for between 63% and 92% of reported savings.”

So let us summarize and distill what we have learned so far:

1. States are looking very aggressively to energy efficiency as part of their resource planning, with rapidly increasing goals.
2. The bulk of this savings is coming from non-residential (e.g., Agricultural, Commercial, and Industrial) measures.
3. Lighting makes up the vast majority of achieved savings.

So this begs my initial question – where are these new savings going to come from?

As the price of efficient lighting comes down, and customers are increasingly happy with the quality of new efficient lamp designs, how are utilities going to continue to squeeze savings out of an increasingly saturated market?  Like squeezing juice from an orange, at some point the effort needed increases faster than the juice keeps coming.  To make matters worse for utility programs, as the federal government gets in the mix, new legislation could eventually phase out much of the inefficient lighting.  This increases the baseline lighting efficiency and makes it more difficult to claim large savings for lighting projects.

Since the majority of savings typically come from the non-residential sector, it seems logical to focus on these industries for more savings. And, where better to look than some of the most energy dense facilities there are – data centers!  Studies indicate that data centers are up to 40 times more energy intensive than typical office buildings and that savings potential can run from 25% – 50% per facility.  This all adds up to a very concentrated opportunity for energy savings.  Sure there are a number of challenges to utility incentives in this space, but what other industries and facility types are utilities going to look to in order to achieve these kind of increased savings goals? To me, this speaks to a large need to investigate and to learn to overcome the challenges to utilities creating incentives for energy efficiency in data centers.

Utility Sponsored Incentives for Data Center Efficiency

One of the big barriers we see to energy efficiency in the data center market is a knowledge gap between utilities that are new to the data center market and data center operators who are not necessarily fluent in energy efficiency or in the language of utilities.  Last week I presented at AFCOM’s 30^th Data Center World Conference in Nashville, TN.  I was there to share the research we’ve done at EMI into what utilities out there are offering data center efficiency incentives and to try and help close this gap.

Part of the presentation was focused on trying to get the data center operators to understand the utility mindset – what motivates utilities and what makes sense for them to offer money for energy efficiency. This is one of my favorite slides, because it attempts to answer one of the questions I get the most from non utility/EE folks:

I love this question because it really gets to the heart of the economics of energy efficiency.  In the end, it often comes down to this singular point made here by Bruce Folsom, the director of energy efficiency programming at the utility Avista in Eastern Washington State, “Our energy future is about using the resources we have wisely, and energy efficiency remains our lowest-cost resource.”

To further this goal of reducing the knowledge gap between utilities and data center operators, I attempt to explain incentives as trying to influence you to implement a project, or to help motivate a transition of an idea into an action. This transition is illustrated here:

The presentation includes explanations of how utility incentives can reduce payback times for energy efficiency projects and increase the ROI of these projects.  In addition, I do a run down of incentives offered for data centers and examples of utilities offering these incentives.  One breakdown I explore is where different incentives are applied within the data center, as illustrated in this slide:

I finish with a list of steps for data center operators to engage with their utility to pursue these incentives:

1. Become familiar with the utility’s programs

• Check your utility’s web site for information on available programs and contact information
• Contact your utility or your account manager to discuss available programs/incentives

2. Identify projects

• Schedule an energy audit or technical assistance from utility (where available)
• Find projects relevant for incentives

3. Confirm Projects

• Fill out any applicable pre-application paperwork to confirm relevance and incentive amounts

4. Perform pre-inspection with utility (where applicable)

5. Install measure

6. Perform post-inspection (where applicable)

• Calculate savings and incentive amount

7. Apply for incentive or rebate

So that’s my attempt to distill my hour long presentation into a blog post.  I was really pleased by the reaction at Data Center World, which speaks for the need for people to help plug these gaps in communication and knowledge.  I had a number of utilities in the room, a few consultants and some data center managers, and the question and answer period turned into more of a discussion between utility folks and managers.  That’s what I like to see.

I would definitely be interested in any feedback on what I’ve included here, or in any information readers have on available programs.  We’re attempting to fill out a matrix of available programs by utility so any information would be greatly appreciated.  Also if anyone is interested in the full presentation let me know.  You can always reach me at ajhoward (at) emi1.com

Based on the reaction I will be attempting to update the presentation and will resubmitting my abstract to hopefully speak at the next Data Center World Conference in Las Vegas in October.  Thanks!

ENERGY STAR for UPS

Speaking of ENERGY STAR, the EPA released a framework document for the newly announced Uninterruptable Power Supplies (UPS) specification last week.  UPS, like computer power supplies before them, lack industry standard measurement procedures to specify their efficiency.  As the market for energy efficient data center equipment grows UPS makers seem to be increasingly marketing the efficiency of their devices, but manufacturers usually specify 100% load – a condition that a UPS will never actually operate in because many UPS are critically underloaded.  Also similar to server power supplies, many UPS are operated in redundant configurations where the load is split between two UPS in the case that one fails.  This means that a UPS in this configuration could only hit 50% load, max.  The efficiency of power conversion equipment tends to fall off below 50% load, so it’s important to measure and specify the efficiency of loads below 50%, because this is where a lot of this equipment is actually running.

To illustrate the point, here’s a chart of power supply efficiency curves from when I was working on the server specification, which I stole from the ENERGY STAR website:

For servers, EPA specified efficiency all the way down to the 10% load condition because available data indicated that that’s where a lot of the redundant power supplies were being operated.  My guess is that ENERGY STAR will be doing a similar thing with UPS, and then the industry will have a way to compare the efficiency of different UPS solutions across much of their operating range. This should be a great help to utilities looking to get verifiable savings through offering incentives or rebates for more efficient UPS.

EPA is also continuing the trend of pushing for standardized reporting requirements (through a power and performance data sheet) and for real-time power and temperature reporting over a standard network.  This is also similar to the V1.0 server specification and what is being proposed for data center storage equipment. EPA is looking to add similar requirements for all data center equipment so that data centers can be operated more efficiently when the managers have better access to data on what’s actually happening in their data center. The power and performance data sheet will also be helpful for proving the specifications of equipment when applying for rebates and incentives.

Interested stakeholders can download the new documents here, and offer comments by April 2, 2010.

Utility and ENERGY STAR Collaboration for Improved Specifications and Programs

I spent Tuesday reacquainting myself with my old friends over at the ENERGY STAR program by attending the ENERGY STAR information sessions for Servers and Storage that preceded the Green Grid Technical Forum. It was interesting seeing things from the “other side of the podium” by being a stakeholder at these meetings instead of being in my old role of assisting the EPA on the development of the specifications.

Status of the Specifications

In terms of status, there seems to be some significant work to be done on both specifications, but as usual EPA is asking the right questions. For both specifications the question is how can you quantify the generalized “efficiency” of the product, or the amount of useful work and performance you get from a system for a given energy consumption? This is the ideal outcome of this process – what everyone wants. As Andrew Fanara (the lead representative of the EPA) said, “I’d also like to ride a unicorn to work”. Meaning that it would be impossible to get a perfect metric, so for now we need a method to rank IT equipment by it’s efficiency, but don’t expect it to be perfect. There’s hope that we’ll get there eventually, but it will be a long processes, as there are a lot of details to be worked out.  The server specification feels like it’s getting closer – they’re currently working on version 2.0 so they’ve been asking these questions for longer – but there’s still a lot of work to be done.  One good thing is the EPA is showing that they’re willing to think a little differently about these products.  I think this is necessary because the complexity of these products and the subtleties of this market make theses specification development efforts very different from many other products the EPA is used to dealing with.

Utilities and ENERGY STAR

I’ve been feeling that there is a gap in thinking between the EPA and the utility industry, and the funny thing is that I think they really need each other. The utilities are constantly looking for new savings opportunities and it’s a lot easier for them to develop effective programs if they are built on the back of good efficiency specifications.  What the EPA needs are stakeholders with a voice to help drive these specifications towards increased levels of rigor for energy savings.

In addition, there needs to be a closing of the gap between the needs of utilities and the output of the ENERGY STAR program. ENERGY STAR should be producing specifications that can easily be adopted for utility programs.  This should be a high priority for ENERGY STAR, but it feels like the current process is to produce the specification without utilities in mind, and then try and adapt the result to a program.  If utilities want to play in this space, they need to be at the table learning about this industry and helping drive the agenda.

Right now vendors dominate the ENERGY STAR meetings. The vendors are extremely knowledgeable, but obviously biased towards their own products and agendas. The meetings often result in vendors standing up and talking about what isn’t possible or what EPA shouldn’t do. What the efficiency community needs are stakeholders at the table telling EPA what they need to help make these specifications useful tools to leverage for energy savings. The way to speed up this process and to keep ENERGY STAR specifications relevant is to have efficiency advocates help drive the process.  This may involve helping generate data and providing some technical resources. This will be expensive, but if the utilities (and other EE advocates) pool their efforts this should be cost effective and will help ensure a useful product for adoption.  The more utilities bring to the table, the more influence they will have.

The thing is that EVERYONE should benefit from useful ENERGY STAR specifications and effective utility programs that leverage these specifications:  ENERGY STAR can further increase their growing relevance in this emerging market; utilities can run influential and cost effective programs to meet their goals; and vendors can market more efficient product offerings.  It’s a win, win, win.  We can no longer let the voices of manufacturers, who seem afraid of being left out of the party because of inefficient product offerings, dominate this conversation. It’s time for utilities and other advocates to team together and help influence this process to get a leg up in this market.

Data-Driven Prescriptive Incentives for Data Centers

I’ve spent the last few weeks reviewing information on utility data center energy efficiency programs for a presentation I’m putting together for AFCOM Data Center World, and have been struck by how few prescriptive programs (or “deemed measures”) are available for data center equipment. The few programs that do exist seem to vary widely and are distributed among different utilities around the country.

The most important information you need for creating these programs are data on which to base your assumptions and calculations, including, data on the typical products in the market (or the baseline) and data on the more efficient offerings.  The delta between these two establishes the energy savings on which to base an incentive.  This was similar in my previous work developing specifications for the ENERGY STAR program for the EPA – the biggest problem was access to quality data of sufficient quantity to really understand the energy use of the products. This is a great strength of the ENERGY STAR program, because as a trusted third party they are able to pull in data from a number of different current, and sometimes future, products to get a real sense of how energy is used across different manufacturers.  When they are pulled together these EPA data sets often seem to be some of the best publically available data sets on the energy consumption of these products – a resource that is useful for the program, as well as for other advocates outside the program.

It seems that the utility industry lacks a similar mechanism to collect sufficient data to develop these prescriptive incentive programs for data center equipment.  The primary source of data seems to be data collected through demonstrations and custom incentive applications.  But the utility industry needs a large amount of data to maintain confidence that the prescriptive programs will deliver actual energy savings that they can reliably claim for their programs. However, the utility industry, like ENERGY STAR itself, has only recently taken the plunge into the data center industry.  A lot of programs have a random assortment of incentives they’ve given out for data centers – an efficient UPS here, an economizer there, a few virtual servers in the mix – and do not seem to be reaching the critical mass needed to gather the quantity of information needed to effectively develop prescriptive programs.

I think this turns into a chicken and egg problem. Utilities sometimes find it hard to get traction on their data center programs because they do not have the prescriptive programs that make it easy for the customer to participate, but without the data from participation in the programs they do not have the information needed to develop the prescriptive programs.  As usual, available data seems to be a bottleneck.  What is needed are some central depositories of data with mechanisms to develop intelligent incentives based on that data.  A lot of different groups and organizations have the potential to work toward this goal (and I believe are doing so), and it is an important goal as more prescriptive incentives would certainly help capture some of the energy savings potential which we all know exists in this industry. I’d be really interested to hear about any potential efforts in this area, so if anyone knows about anything fill me in!

Thoughts from PG&E’s Former Data Center Efficiency Program Manager

I’m getting caught up on some news from over the holidays (happy new year by the way!) and came across this two part interview with Mark Bramfitt, the former program manager for PG&E’s High Tech program which includes data center efficiency projects (found here: Part 1, Part 2).  Mark has been very vocal over the years in spreading information on PG&E’s ground breaking programs in this area and has been a great ambassador to the high tech and utility industries alike on data center utility incentives.

EMI performed the process evaluation of the PG&E’s High Tech Program (which can be found here) and I got to know Mark initially through his support for my work with the EPA on the ENERGY STAR Computer Server specifications.

Scouring through the two interviews I found a number of interesting points from Mark.

On Barriers to Program Adoption:

In my discussions with utilities across the U.S., this is probably the single biggest barrier to program adoption – they can’t find firms who can do the calculations, or resources to appropriately evaluate and review them.

What has slowed us down, I think, is that the IT industry and IT managers had essentially no experience with utility efficiency programs three years ago. It simply has taken us far longer than we anticipated to get the utility partnership message out there to the IT community.

These two quotes emphasize the fact that there’s a gap of knowledge (and talent) between the utility industry and the high tech companies that equip and run data centers.  On the utility front – there is a gap in knowledge about the IT industry.  The fast pace of technological innovation and quick growth in this industry presents challenges in finding or developing the expertise to implement effective programs (including performing the necessary calculations and analysis).  On the high tech company front – there is a gap in knowledge about how to identify and leverage these new programs and efficiently perform the analysis and calculations to receive the incentives.  My conversations with industry members on both sides highlight these frustrations, and the ultimate success of data center efficiency programs will hinge on closing these gaps in the coming years.

New Opportunities

On the retrofit side, we’re seeing interest in air flow management measures as the hot spot, perhaps because customers are getting the message that the returns are great, and it is an easy way to extend the life and capacity of existing facilities.

Metering and monitoring systems lead people to make simple changes, and can directly measure energy savings in support of utility incentive programs. We also like that some systems are moving beyond just measurement into control of facility and IT equipment, and to the extent that they can do so, we can provide incentive funding to support implementation.

There is a lot of room for potential growth from the basic programs currently offered by utilities.  Mark points out one of the areas of low hanging fruit is with air flow management.  This can include simple efforts like blanking panels or more advanced efforts like switching to hot/cold aisle containment.  The challenges here are in confirming the energy savings, which is where the expertise mentioned above is needed.

Metering and monitoring is always a hot topic of conversation in this industry.  Future and current efforts for quantifying energy efficiency gains rely on access to quality data, so the implementation of better measurement and monitoring would be a big a boost to future energy efficiency projects. The challenge, again is quantifying concrete savings from these measures.

These two points bring up what I see as a main challenge to the utility industry in simply and reliably quantifying the energy savings from these measures so they can use incentives to drive these right behaviors.  It’s a significant challenge and will take some creative thinking. Another of Mark’s points emphasizes the potential outcome of these challenges:

That being said, utilities in California are under tremendous pressure to deliver energy efficiency as cost effectively as possible, so some of the industry leadership activities undertaken by PG&E may have to be de-emphasized, and we may not be able to afford to develop new programs and services if they won’t deliver savings.

To get over this hurdle, the industry needs to think creatively on how to efficiently (i.e. cost effectively) justify incentives and programs that help drive the right behavior.  There’s a large potential for energy savings in this industry, and utilities should have a role in driving these behaviors, we just have to continue to push to find effective models for doing this.

Future Growth of the Industry

PG&E is not seeing the level of new data center construction that we had in ’07 and ’08, but the collocation community tells me demand is exceeding supply by 3-to-1. They just can’t get financing to build new facilities.

This last point emphasizes that despite the credit crunch, demand remains high.  Once some capital is freed up we should continue to see rapid growth of the industry and increased opportunities to effect change through intelligent incentives.