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Policy

CAN UTILITIES ADDRESS THE ‘ELEPHANT IN THE ROOM’? End users still face a high initial equipment cost for natural refrigerant systems, but that can be eased with energy incentives – if utilities can be educated about the systems’ energy-saving potential By Charlotte McLaughlin and Michael Garry

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atural refrigerant systems in North America, while gaining market traction, continue to face the “elephant in the room”: initial cost. Though costs are coming down, the premium an end user pays for a natural refrigerant system (before installation) vs. a standard synthetic system can range, on average, between 50%-60%, noted Leigha Joyal, technical product support – energy analyst for OEM Hillphoenix, Conyers, Ga. (Installation costs of a natural refrigerant system can be 10% to 15% less than that of a synthetic system, lowering the installed system pricing, she added.) A growing way for end users to lessen the initial cost of a natural refrigerant system is to obtain incentives from energy utilities, based on the energy efficiency of the system. “The incentives being granted are very significant in bringing that ROI down and actually making the customer take a second or third look and say, ‘This might be worth it for us to go to

a natural system,’” said Joyal, who joined representatives of Whole Foods Market and five western utilities (see next page) at a panel discussion at ATMOsphere America in June. Utilities across the U.S and Canada have various programs to encourage energy reductions, including some aimed at basic refrigeration equipment like LED case lighting, anti-sweat controls, etc. The total budget for these programs — including both energy efficiency and demand response programs — is considerable, reaching just over $9.2 billion in 2016, according to the Consortium for Energy Efficiency. But many utilities are still missing out on how can they achieve extra energy savings, according to Aaron Daly, global director for energy management at Whole Foods Market, Austin, Texas. When it comes to savings from natural refrigerant systems, they have a knowledge hurdle to clear. With some exceptions, “utilities don't care about natural refrigerants because

utilities don’t know about natural refrigerants,” said Daly, who challenged the audience by adding, “How can we engage with utilities? How can we get them interested in what we're doing?” “We need to spark the discussion with utilities to make them understand that natural refrigerants are the way to go,” added Joyal. While California utilities, such as the ones on the panel, have started to incentivize natural refrigerant systems, “it’s very different elsewhere,” she said. A clear presentation of the energy savings inherent in natural refrigerant technologies is one way to gain their attention. In fact, retailers saving energy by switching to natural refrigerants are in a perfect position to start a dialogue with utilities, Daly said. “We need to think about it from the perspective of the utility – what they are ultimately trying to achieve.”

EXAMPLE OF ENERGY SAVINGS In her capacity as an energy analyst at Hillphoenix, Joyal has been successful in securing millions of dollars in utility incentives for customers of the company’s CO 2 refrigeration systems. One way for to engage with utilities is to point out the cost challenges that end users face. “Once we get [utilities] on their own, we can explain what the costs are for a natural system, and what the premium is for going to a CO 2 system,” she said.

Accelerate America 

  August 2017

Accelerate America #27, August 2017  

The Facilitator: Source Refrigeration’s pivotal role in the transition to natural refrigerants