Residential Ventilation (Cleantech to Market)

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Final presentation for UC Berkeley's Cleantech-to-Market program. Project developed commercialization strategy for Lawrence Berkeley technology.

Final presentation for UC Berkeley's Cleantech-to-Market program. Project developed commercialization strategy for Lawrence Berkeley technology.

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  • Adam- Green theme- RIVEC is the next generation of home ventilation that saves energy and maintains air quality
  • Adam3 MBA's and an EE PhDScientist team at LBNL
  • AdamAir exchange is necessary for healthy homes (pollutants build up inside) But HVAC is major component of home energy use
  • AdamResponse to HVAC energy consumption --> tighter home envelopes But additional mechanical ventilation is mandated for air quality standardsASHRAE 62.2 mandates minimum ventilation level for tighter homes
  • AdamToday: 18 States and around 200,000 new single-family homes subject to ASHRAE 62.2By 2013: 36 states and estimated 800,000 new homes in ASHRAE statesMarket size: $100-300MEnergyStar offers additional value proposition, especially in short-term64,000 new builds in US in 2009 outside of ASHRAE states
  • KelvinPatent-pending algorithm incorporates key data points and activity of other fansAlgorithm informs central fan, like a bathroom fan or whole-building fan when to runResponsive system saves energy compared to running 24/7
  • KelvinTwo essential paths to market: software or hardware productsLab has developed viable standalone hardware solutions with sensors/routers, but capital intensive and no competitive advantage with hardwareTwo software routes: installing in existing environmental controls or more sophisticated home energy systems
  • AlexRIVEC best partnership options are software installs into equipment with existing network capabilitySoftware is low capital, low opex and provides differentiation
  • Kelvin-pre-1996 houses are generally not tight enough, and do not need mechanical ventilation-post-1996 houses, even if tight enough, may not have ASHRAE compliant ventilation. Adding an ASHRAE compliant ventilation is a costly operation.-Retrofits that are adding ASHRAE compliant ventilation, such as the retrofits that get EnergyStar certification, have approximately been 12.5k/yr in the past 8 years
  • Alex
  • Serge:“Value generated” by RIVEC across different parts of the value chainFor example: Energy savings: $ savings on utility bill for home-occupants, peak reduction for utilities.In terms of potential value from RIVEC, we see the largest potential for home-builders.Homebuilders care about energy efficiency because it has become part of building code and green building certifications. Green certifications increase the value of new homes… for instance Energy STAR -> Transition to next slide.
  • Energy STAR requires 15% higher energy efficieny than mandated by building code -> i.e. a energy star home should use 15% less energy. They way home builders typically achieve the 15% is from Lighthing, appliances (e.g. dishwasher) and HVAC.
  • AlexValue-Add relies on capturing value to buildersSoftware is way to goNear term: Focus on integration in EnergyStar markets like TexasLonger term: Focus on building value through increased functionality and data collectionNext StepsContinue product testing: software development and integration with environmental controlsDevelop increased functionality:Test different sensor typesEvaluate potential for data collection and remote adjustments
  • Alex
  • Serge:In 2010 new residential floor space completed in China reached 1.8bn sqmetres, slightly less than the entire housing stock of Spain.
  • SergeUse pictures.
  • SergeWe thought builders would be the biggest problem (favor low fixed cost, low efficiency solution). We discovered RIVEC can help them meet efficiency standards at LOWER costTriple Value Proposition:Lower capital cost than other efficiency measuresReduces operating costs for consumer (energy)Better air quality maintenance
  • SergeUse pictures.
  • SergeUse pictures.

Transcript

  • 1. Residential Integrated Ventilation Energy Controller (RIVEC)
    UC Berkeley Cleantech-to-MarketMay, 2011
    University of California, Berkeley | Cleantech-to-Market
  • 2. Outline
    University of California, Berkeley | Cleantech-to-Market
    2
  • 3. The Team
    Adam Boscoe, MBA 2012
    Oil & Gas Consultant, PFC Energy
    Master’s Energy Economics, ITBA
    Financial Analyst
    Alex Pederson, JD, MBA 2012
    Former CFO of renewable start-up
    Practiced as a tech-focused transactional attorney
    LBNL Scientist Team:
    Iain Walker, PhD, Staff Scientist
    Max Sherman, Phd, Senior Scientist
    Post-Doc Assistants:
    DarrylDickerhoff
    David Faulkner
    Serge Stanek, MBA 2012
    International management consulting experience emphases in sales, marketing and corporate growth strategies
    Kelvin So, EE PhD
    Technical expertise in software development and hardware integration
    University of California, Berkeley | Cleantech-to-Market
    3
  • 4. Air exchange is crucial to indoor air quality, but ventilation accounts for a large chunk of energy use
    University of California, Berkeley | Cleantech-to-Market
    4
    CO
    VOCs
    Mold
    Source: DOE, “2009 Buildings Energy Data Book”.
  • 5. Energy efficiency improvements come at a cost to indoor air quality
    Challenge
    University of California, Berkeley | Cleantech-to-Market
    5
    Trend
    ASHRAE 62.2 ventilation required
    Source: Sherman & Matson (2002)
    ASHRAE 62.2: New standard that mandates minimum ventilation standard beyond windows
  • 6. Economics of the technology are driven by regulatory compliance with ASHRAE 62.2 rollout across US
    University of California, Berkeley | Cleantech-to-Market
    6
    ASHRAE 62.2 Adoption
    Energy Star New Homes (2009)
    < $200k
    2010
    $200-1,000k
    2013
    > $5M
    > 800,000 new builds subject to ASHRAE requirements by 2013
    Market size: $100-300M
    ~64,000 new builds in states without ASHRAE adoption (2009)
    Market Size: $10-30M
    Texas example:
    Largest Energy Star market (29,000 new builds in 2009)
    120,000 new homes subject to ASHRAE beginning 2013
  • 7. RIVEC reduces ventilation energy usage while maintaining indoor air quality
    Secondary Ventilation Activity
    University of California, Berkeley | Cleantech-to-Market
    Inputs
    Outputs
    RIVEC Software
    Primary Fan
    (eg. Bathroom)
    House Characteristics
    Size
    # Fans/Capacity
    Climate
    7
  • 8. Pathway to market could be standalone hardware, or software integrated into existing controls or HEMS
    Standalone hardware
     
    • Add-on to existing ventilation
    • 9. Manufacturing complexity
    • 10. One provider for ventilation
    • 11. Require communication with sensors
    • 12. Hardware setup allows for easy implementation
    • 13. Infant market
    University of California, Berkeley | Cleantech-to-Market
    8
    Software (“RIVEC inside”)
    Algorithm
    Environmental Controls
    Home Energy Management
    inside
  • 14. Potential partners are fragmented and don’t offer dual value proposition of efficiency and air quality
    University of California, Berkeley | Cleantech-to-Market
    Infant market
    No clearly dominant player
    Open communications standard
    No ventilation control
    Adjusts for temp. (not ventilation)
    Large players with manufacturing & distribution capabilities
    No dominant players (incumbents < 30% of market)
    Software solution overcomes initial capital barriers and creates a competitive advantage in a highly competitive/undiversified market
    9
  • 15. Potential to install in both new homes and retrofits, but new builds are more attractive path to market
    University of California, Berkeley | Cleantech-to-Market
    10
    VS.
    New Builds
    Retrofits
    Buyer
    Installation
    Market Size
  • 16. Most common solution for meeting minimum ventilation levels has operating cost and efficiency disadvantages
    University of California, Berkeley | Cleantech-to-Market
    11
    Common Solution
    VS.
    RIVEC
    How
    Purchase Price
    Operational Cost
    Home builders favor cheaper, less efficient systems, transferring costs to the homeowner/utility
  • 17. Analysis of value chain indicates that minimum viable product must tap home-builder interests
    Benefits/ unit
    Total Value Generated= $969/unit
    University of California, Berkeley | Cleantech-to-Market
    Participant
    Benefit
    12
  • 18. Homebuilders have high costs for energy efficient HVAC equipment – RIVEC offers better value proposition
    = 15% reduction vs. energy code
    RIVEC
    HVAC
    (5%)
    Average cost of upgrade to energy efficient central cooling unit=$400
    Lighting
    (6%)
    Appliances
    (4%)
    RIVEC can reduce investment in expensive cooling equipment
    2% Reduction
    13
    University of California, Berkeley | Cleantech-to-Market
  • 19. Summary & Next Steps
    What have we learned?
    Most promising segment: new homes in markets with tighter envelope specifications and ASHRAE 62.2 adoption
    Value-add relies on capturing builder benefits (EnergyStar compliance)
    Path-to-market: most promising is software integration into existing hardware
    Development Timeline
    University of California, Berkeley | Cleantech-to-Market
    14
    1
    2
    3
    2011
    2012
    2014+
  • 20. Thank You!
    UC Berkeley Business Plan Competition
    15
    Thanks to our sources:
  • 21. Appendix
    UC Berkeley Business Plan Competition
    16
  • 22. Competitive landscape (alternate slide)
    University of California, Berkeley | Cleantech-to-Market
    17
    RIVEC adds value to these segments
    Home Energy Mngmt System
    Ventilation Controls
    Feature Set
    Manufacturers (Whole-Building Fans)
    Price Point
  • 23. China is booming new home market, but for now obstacles outweigh potential for RIVEC
    Market potential
    Obstacles
    • Booming residential real estate market
    • 24. ~ 18 million new homes built in 2010
    • 25. Air pollution makes smart ventilation critical
    • 26. Some government focus on energy efficiency
    • 27. No ASHRAE 62.2 equivalent implemented
    • 28. Only 30% of homes compliant with building code
    • 29. No widespread adoption of Energy STAR or comparable standards
    • 30. Real estate “bubble” about to burst?
    University of California, Berkeley | Cleantech-to-Market
  • 31. RIVEC offers benefits for home-owners, home-builders, ventilation device manufacturers and utilities
    Benefits
    Customers
    Lower electricity bill
    Comfortable air quality, no “cold spots”
    Further tax or utility incentives
    Home owners / tenants
    • Building code compliance
    • 32. Simple, economic way for energy efficiency
    • 33. Higher value of “green” new homes
    Home builders
    • Improved Energy efficiency of fans (key selling argument)
    • 34. Potential for premium product lines
    Ventilation device & control manufacturers
    • Peak electricity load reduction
    • 35. Overall load reduction
    Electrical utilities
    University of California, Berkeley | Cleantech-to-Market
    19
  • 36. Closer Look: RIVEC Value to Builders
    University of California, Berkeley | Cleantech-to-Market
    Benefits/home
    Total Value Generated= $970
    2% reductionhome energy use
    RIVEC
    Builders
    15% Reduction
    Appliances
    Lighting
    HVAC
    Weighted energy savings
    Heating: $550-2,000
    Cooling: $250-450
    20
  • 37. Closer Look: RIVEC Value to Utilities-Rebate paid to home owners much less than true value to utilities
    University of California, Berkeley | Cleantech-to-Market
    Benefits/home
    Total Value Generated= $970/unit
    Save 560 kWh/year, shift 0.2 kW
    RIVEC
    Total value to utilities: $422*
    Efficiency avoided cost value: $57
    Peak permanent load shifting (PLS): $365*
    *Utilities benefit from peak load shifting ($500/peak kW - $2,500/peak kW), but do not currently have regulatory approval to pay for non-thermal residential load shifting
    Amount passed to home owners for comparable energy efficiency (rebate): $30-50
    Utilities
    21
  • 38. Sample ASHRAE 62.2 whole-building ventilation label
    University of California, Berkeley | Cleantech-to-Market
    22
    To maintain minimum levels of outside air ventilation required for good health, the fan control should be on at all times when the building is occupied, unless there is severe outdoor air contamination.
    -California Energy Commission Indoor Ventilation Minimum Best Practices Guide
  • 39. Energy Star Market
    Single-Family Home Sales
    Source: US Census and Energy Star
    23
    Top 10 Energy Star States by Sales (2009)
    Source: US Census and Energy Star
    Energy Star Home Sales (2009)
    University of California, Berkeley | Cleantech-to-Market