Part 2: Zero Energy vs. Net Zero Case Study

Note: This series was originally posted in January 2016. Due to continued interest in this topic this series has been updated with new information to maintain relevancy as of March 2020.

In the first post of this three-part of this series, What’s the Difference between Net Zero and Zero Energy? – Part 1, we discussed the introduction of a new designation in the energy world, a “zero energy” project. This in contrast to the “net zero” goal that has been more widely pursued within the industry.

This post will explore what it would mean for a single building to achieve zero energy status versus net zero status. To simplify this explanation, we will present all energy use and production in terms of a common unit of measurement, here kilo-British-Thermal-Units (kBTU). Commonly electricity consumption is measured in kilo-Watt-hours (kWh, 1 kWh = 3.413 kBTU), and natural gas consumption in Therms ( 1 Therm = 100 kBTU).

While multiple definitions of the term are used in the industry, “net zero” usually means a building produces as much renewable energy on-site as it consumes on-site on an annual basis. For example if a project uses 200,000 kBTU of electricity and 100,000 kBTU of natural gas, it would have to produce 300,000 kBTU of on-site renewable energy, typically in the form of photovoltaic (PV) produced electric or solar thermal heat to be considered net zero. The common“net zero” designation does not require any on-site storage of energy, nor does it preclude being connected to standard utilities.

In contrast, “zero energy,” as defined by the Department of Energy (DOE), means that a building produces as much renewable energy on-site as it consumes in source energy (accounting for the different amounts energy needed to obtain each type of fuel and deliver to the project site) on an annual basis.

The DOE has provided the following table to convert site-energy use to equivalent source energy required, based on national averages. For example, every unit of electricity that is consumed on-site requires 3.15 units of energy at the source to account for extracting fuel, converting it to electricity (~30-40% efficient typically), and transmitting it across the grid . Our regional efficiency in the Pacific Northwest is better than the national average because we are so reliant on hydropower, but for the purpose of this standard, we are to use the averages to maintain a level playing field.



Going back to our example project mentioned above, using 200,000 kBTU of electricity from the grid and 100,000 kBTU of natural gas, the source energy required is:

200,000 kBTU (electricity) *3.15 + 100,000 kBTU (natural gas) * 1.09 = 739,000 kBTU

To be zero energy, the project has to produce (and export) enough energy to offset the source energy consumption, but it also gets to account for the same conversion factors for any exported energy. Let’s examine how much PV-produced electricity the building would have to export to qualify as zero-energy (assuming the only source of on-site energy production is PV).

739,000 kBTU/3.15 = 234,603 kBTU of PV electricity

So, for this particular example, the site balance would be 300,000 kBTU of consumed energy, but “only” 234,603 kBTU of renewable energy (PV electricity) produced, and the project would be considered zero energy by the DOE definition.

Because of the Source Energy Conversion factor for electricity (3.15), 234,603 kBTU of exported PV electricity produced makes up for the full 739,000 kBTU in source energy from offsite sources.

Another way of thinking of it is that 200,000 kBTU of electricity produced directly offset the 200,000 kBTU of electricity consumed, but then some additional electricity must be provided to the grid to offset the source requirements of the natural gas consumed:

100,000 kBTU natural gas * 1.09 = 109,000 kBTU of source energy / 3.15 = 34,603 kBTU of extra on-site produced electric energy

You can see the electricity produced annually sums to the same value presented above:

200,000 kBTU offsetting electricity consumption + 34,603 kBTU offsetting gas consumption = 234,603 kBTU required on-site production

While it might seem paradoxical at first that less energy is produced onsite than is directly consumed from utility sources, looking at the conversion factors and working through the zero energy calculation allows us to see the real impact of source energy production.

Produced as usable electricity that feeds directly back to the grid, renewable energy generated on site demands no additional energy for extraction or conversion, and transmission losses are greatly reduced because energy is produced locally to where it is consumed. Hence, in the zero energy calculation, a unit of electricity has higher “value” than a unit of natural gas. Conversely, the energy used by the building from the grid has to go through each of those processes before reaching the site, losing efficiency at each step, so consuming “high” value electricity is harder to offset than “lower quality” utility fuels.

Continue reading >>
Part 1: What is Zero Energy?
Part 3: The Value of Zero Energy