Zero energy and onsite thermal energy storage

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition.
By Paul Valenta, CALMAC VP of Sales & Marketing June 8, 2016

Learning Objectives:

  • Define zero energy building (ZEB)
  • Describe ZEB boundaries and methodologies for verifying zero energy buildings’ performance.
  • Understand the impact zero energy buildings can have on the overall power grid.
  • Understand how energy storage can be an integral part of zero energy building design.

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.What are zero energy buildings?

A ZEB (zero energy building) is defined by the U.S. Department of Energy (DOE) as an "energy-efficient building where, on a source-energy basis, the actual annual delivered energy is less than or equal to the onsite renewable exported energy." Prior to this definition, there were many ways to describe a zero energy building. To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. While a ZEB had been commonly referred to as a "net zero building," net zero energy and zero net energy, key feedback to the DOE concluded that "net zero" was confusing to consumers and held no substantive meaning. Therefore, zero energy building or ZEB is the currently accepted terminology under the common definition.

ZEBs are structures designed to be as energy-efficient as possible, reduce power system demand, minimize energy costs, and meet much of their energy requirements from local renewable energy resources. ZEBs should also be designed with other nonenergy environmental attributes in mind, such as good indoor air quality, water protection, and material-resource conservation.

In ZEBs, traditional primary energy resources, like oil, gas, utility-scale renewable fuels, or secondary energy resources, such as electricity, steam, and district heat and cooling, are delivered to the building site. These offsite energy resources are offset by onsite renewable generation which is designated for the building or exported to the grid.

Onsite renewable generation may also be sold as RECs (renewable energy certificates). Sellers of RECs relinquish ownership of the renewable energy aspect of their renewable energy resource. RECs may make sense for buildings in urban areas where it is not practical to install onsite renewable energy. For instance, in urban areas, RECS may be retained when it is not possible to have enough solar panels on a building to offset delivered energy.

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.

Renewable energy certificate-zero energy building (REC-ZEB): An REC-ZEB is an energy-efficient building where, on a source-energy basis, the actual delivered energy is less than or equal to the onsite renewable exported energy plus acquired RECs.

There are many ways in which a building or a group of buildings may be identified as a zero energy building. Several projects have undertaken the challenge of ZEB, but few have succeeded. One problem is that there hasn’t been clear, concise, and broadly accepted terms and definitions in the United States for ZEB. To some extent, designers, contractors, and property owners have not grasped the entire scope of what it means to be ZEB and its larger implications.

Years ago, the term would have invoked images of a small building in the middle of a desolate area with a solar panel on its roof to meet its energy needs. For many, zero energy meant self-sufficient and off grid. Today, a broadly accepted definition of ZEB boundaries and metrics with government and industry consensus will guide American building designers toward clearer design strategies and stimulate growth of the ZEB market.

The First Step: Defining boundaries for ZEB

To properly access a ZEB, a site boundary must be established, such as a property boundary. Here are a few different ways designers may define zero energy buildings depending on the boundary:

Zero energy building: An energy-efficient building where, on a source-energy basis, the actual annual delivered energy is less than or equal to the onsite renewable exported energy.

Zero energy campus: An energy-efficient campus where, on a source-energy basis, the actual annual delivered energy is less than or equal to the onsite renewable exported energy.

Zero energy portfolio: An energy-efficient portfolio where, on a source energy basis, the actual annual delivered energy is less than or equal to the onsite renewable exported energy.

Zero energy community: An energy-efficient community where, on a source-energy basis, the actual annual delivered energy is less than or equal to the onsite renewable exported energy.

Designers also need to think about the boundaries of onsite renewable energy. Will the onsite renewable energy be within the building’s footprint or outside the building footprint?

Determining if a building is a ZEB

Once the boundary is determined, designers must assess whether the building, campus, portfolio or community meets the ZEB definition. Designers must account for energy use including energy for heating, cooling, ventilation, hot water, lighting and plug loads, vehicle charging, process energy, and transportation in the building. Then they must check if onsite renewable energy offsets the delivered energy used for the above-mentioned energy use.

Unlike conventional green-building calculations, site energy is not part of the new DOE guidelines used to access ZEB. Site energy is the most popular definition for building owners because it is easily verified with utility bills. Essentially, the grid is treated as a battery for buying and selling energy. However, this approach does not consider energy cost, availability of fuel, fuel differences, or emissions and is not effective for measuring both onsite energy renewables or cogeneration systems. Site energy doesn’t consider if a more polluting peaker plant is providing the energy or if a wind turbine running at night is doing the same.

Site energy does not consider the values of the various fuels at the source. So electricity and gas are measured equally even though electricity is three times as valuable as gas when looking at the source (power plant). Similarly, regional time-of-day source-energy valuation like California’s TDV (time dependent valuation) is not accounted for at the site. Site energy attempts to treat all energy the same, but energy is not balanced both day and night—and the utilities know this. During the day, when the most polluting plants come online, electricity is the most expensive. At night, with cleaner generation online, prices come down. Consumers across the United States see this effect by way of costly demand charges that make up 30% to 70% of electricity bills. As a result of looking at the source energy, ZEB strongly encourages energy efficiency and energy storage systems because ZEB looks at inefficiencies of the grid.

Source-energy calculations convert different types of energy into equivalent units of raw fuel. Energy used at the site then accounts for the true calculation of energy as it travels from its creation at the source to the building including energy used to extract, process, and deliver as well as any transmission and distribution energy losses. In using this methodology, designers are looking at what happens to energy that is delivered and exported while accounting for the inefficiencies of delivering and exporting energy to and from the grid.

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.

Energy delivered from the power plant (source) is calculated using national source-site energy ratios (See ASHRAE Standard 105). To calculate, simply add up the Btus of all the energy types delivered, multiplied by the corresponding source-site ratio. Then subtract the Btus of all energy types exported, multiplied by the corresponding source-site ratio. If the result is less than or equal to zero, the building is ZEB.

Delivery of onsite renewables to the building are not calculated in the ZEB calculation. Instead, the onsite renewable energy acts as a demand resource similar to daylighting. The Btus of delivered offsite energy resources are multiplied by their corresponding national source-site energy ratio. Likewise, exported energy including exported renewable energy is multiplied by the same source-site ratio. What’s great about this calculation is that it is possible to attain with cogeneration and fewer renewables. In other words, the building becomes the power plant and ultimately requires importing the least amount of offsite resources. Cogeneration efficiency can be improved via onsite thermal energy storage systems, which can use waste heat to run chillers off-peak.

Onsite energy storage is encouraged, too, if the building is designed to export onsite renewable energy. Exported renewable energy has a lower value than if the energy was used at the building. So, there is an incentive to store energy at the building. In other words, PV has more value if used instantly. If sold directly to the grid instead, the unused onsite PV must be exported at a source-site ratio multiplier, resulting in more onsite PV.

ZEB and the future of energy

While ZEBs are very energy-efficient, the fact of the matter remains: ZEBs are still connected to the grid, allowing them to draw electricity produced from traditional energy sources and/or renewable fuels when renewable generation cannot meet the building’s demand for energy. As a result, utilities need to allocate enough generation to the building site to fully power it as needed, and consequently, are not able to downsize infrastructure. The inconsistent nature of renewable energy sources can also create an unpredictable, peaky energy-consumption profile for a ZEB, and utilities need to be ready to allocate generation. Having energy available for emergencies is crucial, and the costs for not being able to provide energy when needed is passed onto commercial customers via demand or capacity charges.

Furthermore, utilities are actually the most efficient when providing a consistent output of electricity to clients. To explore this concept further, use a car as a comparison. When accelerating in a car, the miles per gallon (mpg) are low. However, once a car reaches a consistent speed, the mpg stabilizes. If you push the car to its limit in terms of speed, once again the mpg is less than desirable. A driver in stop-and-go traffic is going to have a much worse mpg than a driver who is able to use cruise control. Zero energy buildings can create the equivalent of stop-and-go traffic for a utility, and with more zero energy mandates being put into effect, this problem is soon to escalate.

Duck curve demonstrates impact of renewable energy without energy storage

The California Independent System Operator (ISO) developed a "duck curve" to demonstrate the potential future impact of customer-sided solar systems, a renewable energy source, on the power grid without energy storage. The scenario the curve portrays is a sunny spring day when utilities limit power output during midday (belly of the duck) due to customers relying on solar energy. However, as the sun goes down and the need for energy resumes later in the day, it creates what can be perceived as a dangerous escalation (duck’s neck) in the amount of energy needed from the utility.

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.

Even in this example, where solar energy is abundantly available (in part, due to increasing popularity in renewables), the utility is never able to downsize and must always be available to provide energy as needed. If the weather changes in the middle of the day, then there will be a significant spike in demand from customers needing utility generation. This already happens on hot summer days due to cooling requirements, but there will be more of these spikes with added renewables on the grid. Given this, utilities will remain oversized and inefficient, and load factors will worsen.

Utility load factors and the impact from ZEB design

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.Spikes in energy use, whether due to solar energy or air conditioning, hurt the nation’s utility load factor (average load/peak load). Currently, the United States’ utility load factor is roughly 50%. This means that, on average, utilities only use half of the generation capacity that is available, although all of it is needed to handle peak-demand hours during the few hot summer days when demand is at its highest.

In theory, if everyone was able to use energy at a steady rate, day and night, then half of the nation’s current power plants and power infrastructure could be decommissioned. This goes to prove that when a building uses electricity can be just as important as how much is being used. This also illustrates the important of reducing peak demand in zero energy buildings.

The problem with peak demand occurs when a ZEB cannot rely on its renewable energy and must go to the grid. The load factor drops down to zero, meaning that utilities must have all the generation it has now on standby. The grid’s fossil fuels are a form of stored energy, but renewables are real energy and must be used or converted into a stored energy. However, it is not cost-effective or environmentally friendly to depend on the grid as if it were a battery. Instead, ZEBs may use energy storage to control load factor and reduce energy demand. Energy storage allows buildings to become virtual batteries, storing energy for when they need it most.

The need for energy storage

One of the main drivers of a building’s peak demand is air conditioning. It’s the elephant in the room, and thermal energy storage is the low-hanging fruit. Air conditioning uses up to 9% of a building’s total energy consumption, accounting for 30% to 40% of the peak electrical demand on a summer day and nearly one-third of energy costs in commercial buildings. The savings from storing cooling is significant. A zero energy building can reduce its peak demand through the use of thermal energy storage by making ice during off-peak hours to cool the building during peak periods. Without thermal energy storage, when demand for cooling spikes, renewable energy is used to cool the building. If the sun is no longer available, more expensive energy must come from the grid. The consumer is then charged expensive demand charges to account for use of the grid’s standby power, which happens to also be more polluting.

By using thermal energy storage instead, ice is created during low-demand hours using low-cost, low-emission energy. The next day, during peak-demand hours, renewable energy can be used to meet the building’s demand for cooling. Energy storage can kick on when the sun isn’t shining, thus, reducing the peak demand, flattening the building’s electrical profile, and improving the grid’s load factor. When there is no increase in energy usage during the high-demand peak hours to the utility, the building appears smaller.

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.

Looking at the example below, if the building peaks at only 1,000 kW, the utility can allocate 40% (600 kW) less electricity to the building with thermal storage than to the nonstorage building. Likewise, on the utility bill, the storage customer’s kilowatt demand charge will be billed at 40% less. With a $9/kW demand charge, that’s $9,000 less per month (1,000 kW * $9/kW). Compare that to the zero energy building without thermal storage. When the sun doesn’t shine, the peak demand goes up to 1,400 kW. It looks just like a standard building in the eyes of the utility! Assuming the same demand charge of $9/kW, the customer will pay $12,600/month (1400 kW * $9/kW) or a 40% higher bill. As noted, earlier demand charges make up 30% to 70% of a bill, making reducing energy demand an important strategy. Consider, too, that more onsite renewables are being purchased, and the grid must provide more relief during lapses in solar output. Reducing peak demand is a big deal for grids. Some utilities around the world are facing a death spiral due to the increase in renewables. So, energy storage is not just important for keeping zero energy building operation affordable, but also in helping stabilize the grid. 

To bring the building community together, the DOE conducted an extensive process involving various industry stakeholders with the goal of reaching a common definition. Courtesy: CALMAC Corp.

Looking ahead to a low-carbon future

A major key to making the shift to zero energy buildings is using onsite energy storage so that the grid can be avoided during high-demand, high-emission, expensive, and peak hours. When coupled with energy storage, renewable generation can become a more reliable source of power that helps a building improve the surrounding grid. Without energy storage, renewable energy that is not used instantly is valued less. Additionally, since demand charges can make up anywhere from 30% to 70% of an electric bill, zero energy buildings that do no incorporate demand-reduction strategies may not be operating as cost-effectively as possible. These charges can be avoided by pairing energy-storage technologies with renewable energy sources so that buildings have more control of when and how that renewable energy is used. This flexibility can help in making buildings smarter and more manageable, especially as electricity rates change.

With growing adoption among government agencies and commercial-building owners, zero energy buildings are rising up as the next link in the green-building chain. ZEBs have the tremendous potential to thrust communities, governments, and the building industry at a faster rate toward a low-carbon future; one in which onsite energy storage will play a major role. Whether the goal is for "carbon-neutral" buildings in 2030, to reduce carbon emissions by 90%, or for zero energy by 2050, building designers looking for ways to lower use of fossil fuels and design more sustainable buildings will need to take a closer look at how energy use is calculated to reduce peak demand.


– Paul Valenta is vice president of sales and marketing for CALMAC, a global manufacturer of thermal energy storage products for commercial cooling.