"Hospitals, office buildings and commercial facilities around the country are already successfully employing natural gas cooling for peak demand reduction and energy cost savings. We commend the Bush Administration for identifying and acting to capture the peak demand reduction opportunity in federal facilities."
According to Occhionero, systems that integrate natural gas air conditioning with electric equipment can offer the biggest benefits to federal and other energy customers. Such integrated systems generally operate with natural gas equipment handling the peak electric demand hours -12 p.m. to 6 p.m.-and electric units running at night, mid-peak hours or in combination with natural gas units to meet extreme peaks. This flexibility allows customers to cut their electric peak consumption dramatically and respond quickly to price signals by running whichever equipment uses the relatively lowest-cost fuel.
Adding to its appeal is the fact that many types of natural gas cooling equipment can be driven by "waste" heat generated by central steam boilers, for example, or by customer-sited power generation technologies such as microturbines and fuel cells. "By recovering thermal energy and combining cooling, heating and power equipment in innovative ways, system efficiencies can more than double," says Occhionero.
"In applications such as data centers, with huge electrical and cooling needs, the combination of on-site power generation and natural gas cooling can obviate the need for the otherwise significant electric utility investment in generation and transmission facilities to serve such loads."
However, despite these advantages, California energy customers who install natural gas cooling are not eligible to receive any of the millions of dollars in incentives that the state is making available to encourage peak demand reduction, Occhionero notes. "It's unconscionable that outdated regulatory policies prevent the application of incentives for one of the most effective peak reduction methods (natural gas cooling)," states Occhionero.
"By providing an incentive of only $400 per kW displaced to boost natural gas cooling, California could realize up to 240 MW of peak reduction within one year, and another 480 MW in the following year. And even with this added capacity, natural gas cooling would account for only 12 percent of the California cooling market."