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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

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