1. ASHRAE/IESNA Standard 90.1 Merle F. McBride, Ph.D., P.E., Member Senior Research Associate Owens Corning ASHRAE Summer Meeting Nashville, TN June 28, 2004 Current Standard 90.1 Economic Analysis Methods

2. Overview s Background s Life Cycle Cost Analysis s Scalar Ratios s National Energy Savings s Examples

3. Background – Std. 90.1-1989 s Professional Judgment s Economics – Pipe Insulation s Imbalance u Envelope u Lighting u HVAC

5. 1991 Proposal – LCC Analysis s Energy Savings u Tier I - 25% u Tier II - 50% u Tier III - 75% s LCC Economics s Balanced s Professional Judgement

7. Life-Cycle Cost Economic Analysis (ASTM E 917) LCC = FC + M + R + E - RV where LCC = life-cycle cost ($) FC= first cost ($) M= maintenance and repair costs ($) R= replacement costs ($) E= energy costs ($) RV= resale value or salvage ($)

8. Present Value PVLCC = FC + PVM + PVR + PVE - PVRV where PVM = M x UPWF PVR= R x UPWF PVE= E x UPWF PVRV= RV x SPVF

9. Uniform Present Worth Factor UPWF = [(1+i) n -1] / [ i x (1+i) n ] Single Present Value Factor SPVF = 1/(1+D) n where i = fuel escalation rate (decimal) n = measure life (years) D = discount rate (decimal)

10. Economic Assumptions PVLCC = PVFC + PVM + PVR + PVE - PVRV PVLCC = PVFC + PVE OBJECTIVE Determine minimum PVLCC 000

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13. Expanding Energy Savings Terms  FYS h x P h x UPWF h + FYS c x P c x UPWF c =  FC x SPVF where FYS h = first year savings for heating (therms) P h = price of heating fuel ($/therm) UPWF h = UPWF for heating (dimensionless) FYS c = first year savings for cooling (kWh) P c = price of heating fuel ($/kWh) UPWF c = UPWF for cooling (dimensionless)  FC= incremental change in first cost ($)

14. Expanding First Year Saving Terms FYS h =  U x  h x HDD65 FYS c =  U x  c x CDD50 where  U = incremental change in U-factors  h = heating regression coefficient  c = cooling regression coefficient HDD65 = heating degree days base 65 o F CDD50 = cooling degree days base 50 o F

15. Define Scalars and Scalar Ratios S h = scalar ratio for heating = UPWF h /SPVF S c = scalar ratio for cooling = UPWF c /SPVF S 2 = SPVF SR = scalar ratio, S h /S 2 and S c /S 2

16. Combining Terms  U x  h x HDD65 x P h x S h +  U x  c x CDD50 x P c x S c =  FC x S 2 Divide by S 2 :  U x  h x HDD65 x P h x S h +  U x  c x CDD50 x P c x S c =  FC S 2 S 2 Apply the definition of the scalar ratio:  U x  h x HDD65 x P h x SR +  U x  c x CDD50 x P c x SR =  FC

17. Scalar Ratio Energy Savings s Economic Life s Fuel Escalation Rates u Heating u Cooling s Discount Rate First Costs s Loan Life s Loan Interest Rate s Tax Rates u Federal u State

18. Economic Applications 1 - Single Measure, Long Life u Opaque Envelope Elements u U-factors, 30 years 2 - Multiple Measures, Long Life u Fenestration u U-factors, SHGC, 30 years 3 - Single Measure, Short Life u HVAC Equipment u COP, 15 years

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23. Current Standard 90.1 Economic Analysis Methods ASHRAE Summer Meeting Nashville, TN June 28, 2004 ASHRAE/IESNA Standard 90.1 1-37