Meeting Today's Energy Challenges With On-Site Energy Systems

May 1, 2007
Recognizing the increasingly complex energy challenges facing building-system designers (Figure 1), the U.S. Department of Energy and the U.S. Environmental

Recognizing the increasingly complex energy challenges facing building-system designers (Figure 1), the U.S. Department of Energy and the U.S. Environmental Protection Agency (EPA) have formulated a multifaceted approach to support innovation and redirection in the way energy systems are built, where energy systems are located, and how energy systems are operated. Included in these plans are a number of new promising technologies, such as fuel cells and hydrogen engines. Against the backdrop of these technologies is a focus on combined heat and power (CHP), on-site power plants that use natural gas as fuel input and recover exhaust heat for recycling into useful thermal energy, such as chilled and hot water. A single natural-gas input to a plant results in three useful energy commodities to satisfy total-building-energy needs: electricity, air conditioning, and heating.

The appealing advantage of CHP technologies is that the various components that comprise a CHP system are available “off the shelf,” albeit from a variety of manufacturers. The trick to meeting challenges effectively is to select and package the right components to meet the specific loads of a customer's building. In other words, to maximize efficiency and minimize the impact on the environment, an electrical prime mover and associated thermally activated technologies must be optimized to meet expected demand, thereby eliminating wasted thermal or electrical energy.

This article will focus on how Austin Energy, a community-owned electric utility and a department of the City of Austin; Dell Children's Medical Center of Central Texas; and Burns & McDonnell, an engineering, architecture, construction, environmental, and consulting-services firm, are meeting and, in some cases, exceeding — energy challenges.


In 1999, the City of Austin decided to move its municipal airport to the site of the former Bergstrom Air Force Base, leaving 711 acres of land for redevelopment. Subsequently, the city chose ROMA Design Group to create a master redevelopment plan and Catellus Development Group to implement the plan. Integrated into the plan was an on-site district energy plant to meet energy needs — especially air conditioning — for the high-density and mixed-use buildings planned.

As the master plan took shape, Seton Healthcare Network decided to relocate its children's medical center to a larger, easier-to-access site. Seton's plans were for a “hospital of the future,” a facility that embraced sustainable-building technology and practices that could make it the first Leadership in Energy and Environmental Design (LEED) Platinum-certified health-care facility in the world. The city's Robert Mueller Municipal Airport redevelopment site was chosen as the location, with an expectation that the children's medical center would become the anchor tenant, driving much of the surrounding economic development toward health care.

Having similar interests, Austin Energy and Seton Healthcare worked together to create sustainable energy solutions. The energy solution that was built would have to meet or exceed Texas Department of State Health Services and Joint Commission on Accreditation of Healthcare Organizations standards, especially as related to life-safety energy needs.

Austin Energy chose Burns & McDonnell to provide a turnkey packaged energy plant consisting of a 4.6-mw combustion turbine mated to a fired heat-recovery steam generator. Steam produced by a prime mover was used to meet HVAC and process-heating requirements directly. By using an absorption chiller, the steam was used to meet the air-conditioning and dehumidification needs of the children's medical center. To supplement the chiller and smooth out the cooling demand on it, a thermal-energy-storage (TES) system was installed. The TES system allowed excessive cooling capacity to be stored during periods of low demand during the night and discharged during the hot afternoon of the following day.

To ensure the continuation of power delivery during an emergency or an interruption of normal grid power, a diesel generator was provided. In addition to the continuation of life-safety power, this generator provided “black-start” capability for the combustion turbine if a duress event were to trip off the unit.

While the combustion turbine, heat-recovery steam generator, and absorption chiller satisfied the campus loads, a redundant electric chiller and boiler were installed to allow seamless delivery of energy commodities during scheduled and unscheduled downtime of CHP equipment.


With equipment selected to meet the identified energy challenges, how did the CHP system perform? Let's compare the performance of this system to the challenges in Figure 1, while identifying lessons learned.

Energy security

The Sept. 11, 2001, terrorist attacks; the Northeast blackout of 2003; and hurricanes Katrina and Rita demonstrated that providing reliable power to public sanctuaries that supply shelter is critical to saving lives. Many critical-care facilities are required to be 100-percent up and running in the event of a grid outage because of the reliance on digital technology for operations such as medical records, diagnostic imaging, and radio-frequency-identification bar-code-scan drug delivery. Reliable electricity and thermal energy are mandatory for first responders to fulfill their missions.

Through the years, hospitals and other critical facilities have provided backup energy systems to meet life-safety-code requirements. This means that just enough power is generated for minimal heating and lighting in designated life-safety areas. Reliable cooling energy and ventilation to the balance of a facility has not been required and, thus, not provided in most facilities.

Recent emergencies indicate that backup energy systems too often are not only insufficient in terms of capacity, but not as reliable as expected. In fact, the failure probability of a traditional hospital “grid-plus-backup” system is 67 percent, according to “Primen Perspective, Rx for Health Care Power Failures.”1 This is because of a variety of reasons, but, too often, backup energy systems are not rated for the continuous service that emergency circumstances demand and, as a result, are not nearly as reliable or capable as a primary system. This is not acceptable when a backup system is responsible for saving lives.

The predictable performance of an energy-delivery system is improved when a primary system is designed for mission-critical needs and a traditional electric grid can serve as backup. For the medical-center project, CHP was designed to operate in parallel with the utility electric grid. The CHP plant provided thermal and electrical energy, but in the event the traditional utility feed became unreliable, the CHP plant automatically would separate from the grid. The CHP plant and the total medical-center energy demand would be satisfied indefinitely in this “island” mode, enabling 100-percent utilization of the medical center's capabilities.

In addition to providing mission-critical power whenever the traditional grid became unreliable, delivery of normal power was improved. The quality of the power to the medical center was enhanced because generation equipment was located on site.

The result was that whenever traditional-grid reliability was in jeopardy, the CHP plant operated seamlessly independently of the grid while satisfying all of the medical center's needs, down to the last parking-lot light.

From the utility's perspective, the excess power capacity was beneficial in meeting peak demand and mitigating costs when the decision to purchase or sell peak power capacity into the wholesale electric market was made.

Fuel scarcity

The traditional utility energy-delivery system is not particularly efficient from a fuel perspective. Approximately two-thirds of the energy supplied to a traditional fossil-fuel power plant is lost at the plant during the energy-conversion process (i.e., converting gas or coal to electricity). Furthermore, 4 to 6 percent of the electricity leaving the plant is lost in the transmission and distribution system because of line and transformer losses and reactive-power issues. In many instances, less than 30 percent of the energy consumed to make electricity is delivered to a customer's meter.

By producing electrical energy on site and recovering energy normally lost in the production process, the energy efficiency of an on-site energy plant can be improved drastically, exceeding 75 percent. So by recycling traditional “waste” heat from the exhaust of the combustion turbine, much of the medical center's cooling- and heating-energy needs can be met without using a boiler or electric chiller. By producing electricity on site, eliminating demand normally created by an electric chiller, and using a TES tank, the demand on the electric utility grid is less during on-peak periods than it is during off-peak periods. This inverse demand load profile is a great match for an electric utility's demand-reduction and conservation programs.

An interesting way to measure energy efficiency is to use a utility's metrics, namely heat rate (i.e., British thermal units per kilowatt-hour). The economics of power generation for a utility are maximized by base loading energy plants with the best heat rate first and dispatching the poorer heat rate plants last. Although the simple-cycle heat rate of the combustion turbine was only 9,300 Btu per kilowatt-hour, when the electrical equivalent of recycled heat was included, the effective heat rate dropped to approximately 7,000 Btu per kilowatt-hour, besting even the most energy-efficient combined-cycle power plants. Attaining such attractive heat-rate efficiencies requires that all captured thermal energy be used. Therefore, CHP-plant equipment must be selected to match thermal loads.

In addition to competitive heat rates, the CHP system improved voltage support and power factor because of its location within the distribution grid.

Environmental impacts

Energy engineers sometimes have difficulty assessing the role that buildings play in global warming. As building energy engineers, we should join our professional peers, namely architects and air-conditioning engineers, in noting that stationary power-delivery systems and connected buildings are major contributors of carbon emissions. The buildings sector is the largest carbon emitter, exceeding transportation and industry.

Energy engineers can take a positive step in changing the dismal carbon-dioxide (CO2) problem in the buildings sector by promoting the use of environmentally correct on-site energy systems to meet customer energy needs for new and renovated buildings. It is our responsibility to take action by doing our part to address global warming by reducing the carbon footprint of our energy systems while also reducing nitrous-oxide (NOx) and sulfur-dioxide (SO2) emissions.

The hospital project is achieving outstanding environmental results, as demonstrated in Figure 2. Compared with Austin Energy's fleet of power plants, the medical center's CHP plant produces a 47-percent reduction in CO2 emissions, 99-percent reduction in SO2 emissions, and a 93-percent reduction in NOx emissions. What is fascinating is that the CHP plant's impact on the environment is significantly less than a state-of-the-art combined-cycle power plant's would be. In addition to clean electric and thermal generation, the heat produced by a CHP system will reduce the carbon emissions normally produced by a boiler by about 60 percent.

These numbers reflect the output-based emissions credits that include the value of thermal energy recovery. These numbers are so good that the medical center CHP system exceeds stringent Texas Commission on Environmental Quality standards pertaining to “non-attainment” and near non-attainment EPA designations for criteria pollutants.

Not all CHP systems necessarily have this low of an emissions impact, but if an engineer does a good job selecting appropriate equipment to meet a load, similar results can be expected.

Sustainable-design standards and LEED

Austin has stringent environmental requirements. By code, all institutional, office, and single-tenant retail structures greater than 25,000 sq ft constructed at the Mueller redevelopment must achieve at minimum a two-star rating from Austin Energy's green-building program or a LEED Certified rating from the United States Green Building Council (USGBC). The medical center and the energy plant will be submitted to the USGBC as a single project.

The medical center will receive several benefits from its sustainable design, such as improved clinical outcomes — healthier buildings result in healthier kids and a healthier staff. LEED also makes economic sense by reducing initial capital costs while providing life-cycle-cost savings. Another significant benefit is that the changes implemented to attain LEED certification help with employee recruitment and are expected to increase retention.

The LEED certification process compares a baseline, as determined by ANSI/ASHRAE/IESNA Standard 90.1-2004, Energy Standard for Buildings Except Low-Rise Residential Buildings, with a higher standard — in this case, an on-site packaged hybrid CHP energy plant. To achieve the points defined in LEED for New Construction Energy and Atmosphere (EA) Credit 1, Optimize Energy Performance, it must be demonstrated that an on-site hybrid energy plant is more efficient than a normal central generation, transmission, and distribution, or “metered,” energy approach. EA Credit 1 is not based on actual energy efficiency, but on energy costs as a surrogate for energy efficiency. The energy-cost-budget method underlying the calculation of EA Credit 1 is based on whole-building simulation per Section 11 of Standard 90.1-2004. This type of project can obtain up to 10 energy-efficiency points based on improvement beyond the baseline building served from the grid.

As part of the LEED evaluation process, the efficiency of on-site energy was compared with that of a traditional metered approach. The energy plant may be one of the first in the country to receive energy credits under updated EA-Credit-1 criteria, which gives credit for CHP or district heating and cooling serving a building.


As attractive as the energy-security, fuel-scarcity, environmental-impacts, and sustainable-design-standard benefits are, an on-site energy project will not materialize unless financial hurdles are overcome. By correctly selecting equipment to match thermal and electrical needs, deploying a pre-engineered/pre-packaged installation approach to reduce costs, and employing a knowledgeable operations staff, the on-site energy system will allow reasonable returns on investment based on the economic advantages of the electricity, chilled water, steam, and value of grid-independent power.

If a third-party provider, such as Austin Energy, makes an investment in CHP, revenue from the sales of thermal and electrical energy will justify the investment. If a building owner makes an investment in self-providing CHP, he or she will find that the life-cycle costs are no higher than they would be with traditional boilers, chillers, and backup generators assuming that the self-build “traditional” central utility plant is built to the same level of reliability and capacity. The initial equipment costs may be higher for CHP, but the ongoing operations-and-maintenance costs will be lower. In the future, CHP economics will improve if the value of grid independence and carbon-emissions reduction can be monetized and given “proforma” values.


Given that off-the-shelf equipment can be packaged and integrated to meet the energy challenges of today and the future, now is the time for astute and responsible owners and engineers to consider an on-site energy plant as the preferred choice for meeting the five energy challenges previously stated.


  1. Primen perspective, Rx for health care power failures. (n.d.) Boulder, Colo.: Primen.

Director of energy business development for Austin Energy in Austin, Texas, Clifton Braddock, CEM, is responsible for the development of distributed-generation and district-energy projects and helping other utilities develop similar systems. He is active in numerous organizations, such as the American Society of Heating, Refrigerating and Air-Conditioning Engineers, the International District Energy Association, and the United States Combined Heating and Power Association. The vice president and Austin-area manager for Broaddus & Associates, Robert P. Moroz, AIA, LEED AP, served as program director for the Dell Children's Medical Center of Central Texas/Robert Mueller Municipal Airport redevelopment site during programming, planning, and design. He sits on the steering committee of “The Green Guide for Health Care.” Edward Mardiat, DBIA, is the director of CHP development for and a principal of Burns & McDonnell in Kansas City, Mo. With more than 25 years of design and project-management experience, he has focused his efforts over the last 12 years on the marketing and project-development of on-site energy projects. He is working with several Fortune 500 companies, municipal utilities, universities, and health-care companies to develop cooling, heating, and power projects.

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