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7.A. - Page 62 of 285 <br />2019 Energy Efficiency Ordinance Cost-effectiveness Study <br />discharge to the electric grid if there is excess energy available. During other months the battery discharges <br />whenever the PV system does not cover the entire house load and does not discharge to the electric grid. This <br />control option is considered to be most reflective of the current products on the market. This control option <br />requires an input for the "First Hour of the Summer Peak" and the Statewide CASE Team applied the default <br />hour in CBECC-Res which differs by climate zone (either a 6pm or 7pm start). The Self Utilization Credit was <br />taken when the battery system was modeled. <br />2.4 Incremental Costs <br />Table 4 below summarizes the incremental cost assumptions for measures evaluated in this study. Incremental <br />costs represent the equipment, installation, replacement, and maintenance costs of the proposed measures <br />relative to the base case.11 Replacement costs are applied to HVAC and DHW equipment, PV inverters, and <br />battery systems over the 30 -year evaluation period. There is no assumed maintenance on the envelope, HVAC, <br />or DHW measures since there should not be any additional maintenance cost for a more efficient version of the <br />same system type as the baseline. Costs were estimated to reflect costs to the building owner. When costs were <br />obtained from a source that didn't already include builder overhead and profit, a markup of ten percent was <br />added. All costs are provided as present value in 2020 (2020 PV$). Costs due to variations in furnace, air <br />conditioner, and heat pump capacity by climate zone were not accounted for in the analysis. <br />Equipment lifetimes applied in this analysis for the water heating and space conditioning measures are <br />summarized in Table 3. <br />Table 3: Lifetime of Water Heating & Space Conditioning Eqi <br />Measure <br />Lifetime <br />Gas Furnace <br />20 <br />Air Conditioner <br />20 <br />Heat Pump <br />15 <br />Gas Tankless Water Heater <br />20 <br />Heat Pump Water Heater <br />15 <br />Source: City of Palo Alto 2019 Title 24 Energy Reach Code Cost- <br />effectiveness Analysis Draft (TRC, 2018) which is based on the <br />Database of Energy Efficiency Resources (DEER).12 <br />iipment Measures <br />11 Interest costs due to financing are not included in the incremental costs presented in the Table 4 but are <br />accounted for in the lifetime cost analysis. All first costs are assumed to be financed in a mortgage, see Section <br />2.5 for details. <br />12 http://www.deeresources.com <br />2019-08-01 <br />314 <br />