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Technical Barriers to Decarbonization

Large commercial and residential buildings must overcome various hurdles before implementing deep retrofits or capital projects that help achieve building decarbonization. In this section, we address technical barriers and questions often faced by building owners and retrofit project developers. 

Decentralized Systems and Tenant Equipment
Facade and Windows
Heat Pump Limitations
Crossover Device or “Magic Box” Technology
Zero Carbon Fuels Limitations
Low-Carbon Fuels
Renewable Energy Procurement Limitations
Pending Carbon Trading Programs Limitations
Decentralized Systems and Tenant Equipment

Access to Occupied Spaces.

Lease Concerns.

Regulatory Limitations - Rent Stabilized Apartments

  1. The building owner is required to provide free heat and hot water.
  2. No mechanism to recover investment in new systems is necessary to achieve decarbonization.
  3. Buildings are capital constrained

Split Incentives (tenants pay for energy).


Con Edison Steam: assume district steam system will decarbonize

High temperature renewable resources are limited and face hurdles:

  • Deep Bore Geothermal
  • Renewable Hydrogen
  • Carbon Capture and Sequestration
  • Biomethane
  • Electric Boilers
  • High-temperature thermal storage
  • Hight-temperature industrial heat pumps
  • Waste Heat Capture and Reuse
  • Fission
Barriers to Electrification:

Utility Capacity Limitations:

  • Electric riser capacity
  • Switchgear expansion
  • New service/vault expansion/point-of-entry space constraints
  • Capacity competition with other electrification needs:
    • Space heat and cooling
    • DHW
    • Cooking
    • Pumps and motors
  • Excess Distribution Facility Charges (EDF)
  • Contributions in Aid of Construction (CIAC)
  • Partial Electrification concepts achieve deep decarbonization but do not necessarily achieve peak gas demand reductions (debatable)

Demand reduction strategies do not obviate capacity limitations unless the utility accepts the solution as a permanent demand/load reduction strategy.

  • Battery Storage: 
    • Fire danger
    • Space constraints
    • Electricity distribution limitations
    • Structural loads
  • Building Automation/BMS/Demand Response:
    • Cost
    • Integration limitations; Blackbox software
    • Microgrid development
      1. Cost
      2. Lack of expertise
  • On-site Generation: 
    • Space constraints
    • Gas use; Zero carbon fuels availability is non-existent
    • Structural loads
    • Pipe infrastructure
  • Space constrains
  • Structural loads
  • Technology limitations: 
    • Vacuum insulated storage tanks
    • Phase change material (DHW, space heating)
  • Building pipe riser limitations; need additional riser capacity:
    • Building water loops are typically “top down” - cooling capacity is typically located at rooftop mechanical penthouses; cooling towers at roof.
      1. Some exceptions to this rule
    • Space Constraints
  • Drilling Difficulty:
    • Outdoor space constraints for geothermal wells
    • Difficult permitting
    • Mud and cuttings disposal
      1. Contaminated soil disposal
    • Overhead clearance constraints for drilling in basements/garages 
  • Shared Loop/Thermal Utility Limitations: 
    • Requires entity that may operate in public ROWs and across property lines
    • Utilities are limited by regulations for gas, steam or electric delivery versus shared loop media (ambient temperature water).
      1. Only utility entities can provide very long amortization periods
      2. Utilities are best suited to work amid crowded underground municipal ROWs.
  • Deep Bore Geothermal Limitations:
    • Requires test drilling and geological assessment
    • Seismic risk
    • Drilling equipment is very large - more akin to oil and gas development equipment
    • Subsurface land rights and DEC restrictions
  • Lighting with lighting controls
  • High-efficiency electrically commutated motors (ECM)
  • Variable Frequency Drives (VFD) on pumps and motors
  • Retro-commissioning tasks and maintenance
  • Staggered work scheduling
  • Telework
  • Submetering and billing: potentially creates split incentive between landlord and tenant: 

    • Water
    • Electric
      1. Onerous regulatory compliance
    • Heat and Cooling
      1. Rent stabilized buildings prohibit billing for heat
Facade and Windows

Work must be completed at the end of facade/window useful life; very long useful life

Building code

Glazing reduction at odds with aesthetic/marketability concerns

Difficult installing with occupied spaces

Reduce Local Law 11 recurring cost via overcladding

  • Aesthetic concerns
  • At odds with historic preservation
  • Capital intensive
  • Lot line limitations

Technology Limitations

  • Need higher R-value/inch for thinner wall assembly:

    • Vacuum insulated panels

    • Aerogel panels/batts

    • Zero-GWP blowing agents for closed cell spray foam (nitrogen blowing agent needs to be more widely adopted)


Energy Recovery Ventilation (ERV)

  • Space constraints
  • System tie-in point accessibility/feasibility

Rooftop Supply Air (Reznor) Unit Alternatives

  • Heat pump alternatives to eliminate resistance heat
  • Combine with ERV

HVAC Load Reduction (HLR) Technology

  • Vent or capture exhaust gases
  • Space constraints
  • System tie-in point accessibility/feasibility

Central vs. Decentralized Ventilation Systems

Direct Outside Air System (DOAS)

  • Modular perimeter ducted air heat pumps: 

    • Competition for leasable space
    • Space constraints

Ventilation Points-of-Entry

  • Aesthetic concerns
  • Lot line facades/building setbacks
  • Competition with leasable space
  • Space constraints
Heat Pump Limitations

Variable Refrigerant Flow (VRF)

  • Fire and life safety concerns about volume of refrigerant gas located within occupied spaces.

Regulatory risk from new refrigerant policies


Ducted Supply/Exhaust Air Source Heat Pumps

Domestic Hot Water

  • Central DHW Systems: 

    • Limited domestic production
    • Performance not confirmed by independent third parties

    • More demonstration projects needed
  • Decentralized DHW Systems

More open-source interconnection between devices/interoperability is needed to achieve energy distribution flexibility and capacity expansion:

  • Air source that has a manifold connection to interconnect with water source or refrigerant gas distribution
  • Interconnectivity/simplified heat exchange between refrigerants/water/air, etc.
  • Other options and add-ons
Crossover Device or “Magic Box” Technology

Multi-purpose technology for heating, cooling, heat exchange and ventilation, filtration, and/or domestic hot water

Domestic production and supply chain is limited

Small players operating in this space

Technology is not tested over long operational periods

  • Daikin, Nilan, Zehnder, Drexel und Weiss, Minotair, Build Equinox, Clivet
Zero Carbon Fuel Limitations

Green Hydrogen

Renewable Natural Gas

Low-Carbon Fuels



Renewable Energy Procurement Limitations

REC Purchasing

  • NYSERDA monopolizes REC purchasing from renewable energy projects
Pending Carbon Trading Programs Limitations

Deployment timeline is highly uncertain

Price per ton of carbon is highly uncertain and will likely be volatile/low based on previous emissions trading scheme outcomes

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