Take 10: HVAC Refurbishment/Replacement

May 11, 2010

I believe that you stated the useful life of an HVAC system is 20 to 30 years. Most manufacturers state that a unit has an economic life of about 18 to 22 years. What is the reason for the disparity in numbers? We have typically used the economic life as the number.
It really depends on the type of system, the particular item, the frequency of use, and maintenance. For example, a small packaged piece of equipment such as a DX Rooftop Unit may only have a 10- to 15-year life because it is exposed to weather and may be built for light commercial use, whereas a large centrifugal chiller may have a 30- to 35-year life because it is of heavier construction, enclosed, and regularly serviced. It also may need to run for only six months out of the year if installed in a cool climate location. BOMA and the Federal Agencies should have some good useful life information for you.

What is the typical number that you use to decide the system should be replaced?
The industry standard for FCI is Good = 0 to 5%, Fair = 5 to 10%, Poor = 10 to 30%, and Critical = greater than 30%. Our experience indicates that facility managers view the FCI range as: Good = 0 to 20%, Fair = 20 to 50%, Poor = 50 to 70%, and all facilities above 70% are candidates for replacement.

I was thinking that "FCI" was proprietary to Vanderweil Facility Advisors. Is that not the case?
No, it is a nationally recognized standard. According to Wikipedia, AME was approached by a research group working on a project that was sponsored by the National Association of College and University Business Officers. The group asked for a written description of the facility condition assessment process and related data analysis. The resulting written process and analysis served as the basis for the book referenced above.

Two of the AME employees who contributed were William H. (Bill) Thomas and the late Emmett Richardson. Both had previously worked for the Naval Facilities Engineering Command (NAVFAC), which is one of the U.S. Navy's in-house consulting arms. Thomas and Richardson had calculated the FCI for budget preparation and used the ratio to allocate operations and maintenance money across naval activities and installations. The FCI was a strictly informal tool that Thomas and Richardson used while working for the Navy. It was developed and adopted as an industry benchmark by AME.

Does it pay to use set back programming to save on energy cost?
Yes, with caveats, for every degree F. you can lower the temperature in a space on a 24-hour period, you can save approximately 5% energy. However, you can go to an extreme. Keep in mind that you will need to supply heat in the morning to raise the temperature, so the best strategy is to keep the space as cool as possible for the base set point, then let lights, equipment, solar gain and people raise the temperature to the optimal temperature without going into the cooling mode. Then back off 5 to 7 degrees at night. Keep in mind that the climate zone and the building tightness/insulation have an influence.

An institutional owner has an existing 40-year-plus lab bldg with under 12 feet of floor-to-floor structure and wants to gut and re-do as a state of the art research and teaching lab complex, low energy use, and flexible to accommodate changing technology for the next 40 years. How do you advise? Do you reuse the structure even if it still has 20 years of useful life or replace with new?
 That’s difficult to say without getting more information about the type of lab, etc. However, it is possible to replace the MEP systems with high-performance options in a 12-foot floor-to-floor height. Another concern is that you indicate that you want the lab to have a 40-year life but you indicate that the structure has 20 years. If that is the case, it sounds like the only viable option would be to replace with a new building.

What are the best financial analysis tools to use for showing conservation/upgrade financial benefits ?? Simple payback is the default but doesn't value new technology benefit, performance degradation, energy cost escation,etc. Is it net preset value, life cycle cost??
You’re correct; you need to take into account subjective factors. Some of these factors can be translated into staff satisfaction resulting in higher productivity, fewer sick days, etc. You can also translate some high-performance system options into more efficient use of the core in high-rise structures for example or the occupants being able to sit next to a double façade system, thus resulting in a higher rentable area efficiency. I still like to use Simple Payback as the rough index and NPV and LCC analysis for greater accuracy and weave the story of the subjective factors into the analysis.

Carbon is the "Real" unit of measurement in terms of the value of energy efficiency upgrades instead of $$. When and how should we include the cost of carbon into our financial benefits analysis??
HOK has developed our own Carbon Assessment Tool that analyzes carbon in a number of different ways. I would be happy to work with you in greater detail on this.

How did the chilled beam installation work in Chicago with the union?
 It was an issue but we worked through it. The more items that are integrated (i.e. HVAC, Ceiling System, Sprinklers and Lighting) the greater the concern.

How did the different trades work together to hook up their own components?
Typically the ceiling was hung, chilled beam installed, and the respective trades made their own connections.

Was the desk system "kit of parts" made by a specific manufacturer?
No, it was a combination of components integrated into the furniture system (i.e. occupancy controllers, individual environmental control, task lighting, etc.).

How was the additional outside air handled?
The outside air was via a central air handling unit with heat recovery and distributed to the active chilled beams. Roughly 20% of the air volume is required compared to traditional VAV.

What is the heat source for a chilled beam system? Is it a separate heating system?
Hot water is the heating source and it can be generated by high-efficiency boilers or taken from waste heat through heat exchangers. It is typically distributed via a 4-pipe system and can be controlled by zone or by individual chilled beam.

What is the length of time to calculate maintenance costs when calculating the formula?
 Ideally the maintenance cost time period should match the useful life period.

For In-Kind replacements for HVAC equipment, what are some  maintenance examples where it would be cheaper to replace the system rather than fixing/maintaining it?
Typically when you start to see a steep ramp up in maintenance cost as compared to the norm or where replacement parts are becoming very difficult or costly. Also, if you are on a maintenance service contract and you see a large increase in the service fee, it usually is a tip off that replacement may be worth considering. This should track relatively closely to the number of years left in the useful life.

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