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With high-efficiency commercial boilers reaching thermal efficiency levels up to 98 percent, you couldn’t be blamed for thinking water heaters had reached their natural limit of efficiency. But by utilizing free, renewable energy from the air, an innovative new technology promises energy efficiency levels ranging anywhere from 120 to 220 percent.

The Ilios high-efficiency water heater uses a propane or natural gas engine to power an air-source heat pump, which draws heat from the surrounding air to heat water. At the same time, the machine captures waste heat from the propane engine, maximizing the efficiency of the system and boosting the heating capacity far beyond that of electrically powered heat pumps.

By uniting the benefits of heat pump water heaters and combined heat and power (or CHP) systems, these water heaters use 50 percent less fuel to produce the same amount of heat as a traditional boiler, according to Stephen Lafaille, Ilios Product Manager for Tecogen, the product’s manufacturer.

The Ilios high-efficiency water heater powers a heat pump with a propane-fueled engine while simultaneously recovering waste heat from the engine to maximize efficiency.

For buildings with large water heating loads located away from the natural gas grid, a propane-fueled Ilios unit can offer a return on investment that ranges from one to two years. But a limited time pilot project funded by Ilios and the Propane Education & Research Council (PERC) can cut that payback dramatically.

The pilot will offer dramatic discounts on the technology to four U.S. buildings in order to gather operating data and provide economic payback information. Potential sites for these systems, which offer heat output from 300,000 to 600,000 British thermal units (Btu) per hour, include hotels, hospitals, nursing homes, apartment buildings, athletic facilities, swimming pools, and agriculture and aquaculture projects.

To apply, contact Greg Kerr, PERC director of research and development, at 202-452-8975.

Happy hogs

Turkey Hill Farms and South Morgan Acres, hog farms operated by Professional Swine Management in Martinsburg, Mo., and Blandinsville, Ill., exemplify ideal Ilios applications, Lafaille says. To replace the inefficient lightbulb heating used to warm the piglets in their farrowing barns, the farms implemented a sophisticated hydronic floor mat heating system.

Propane-fueled Ilios water heaters were located in the gestation barns to recover indoor waste heat, allowing the heat pumps to operate at top efficiency during the winter. When the outdoor temperature rises above 70 degrees, the units switch to using the warmer outdoor air with mechanized louvers. As important side benefits, the heat pumps reduce the cooling load in the gestation barns by 30 tons, while the fans exhaust 20,000 cubic feet of air per minute for free, saving 5 kilowatts per hour of fan power year-round. Three Ilios machines at the two farms save the company more than $100,000 per year in water heating costs, Lafaille says.

On-site power generation

Here’s what makes the technology so efficient. A traditional heat pump water heater would be powered by electricity from the grid. But electric generation plants are only about 35 percent efficient; the rest of the energy is lost as waste heat and in transmission losses. In the Ilios machine, a propane or natural gas engine directly powers the heat pump compressor, as well as an on-board 5-kW generator that powers the fans and pump. The system requires only a 120-volt, single-phase power cable, similar to a coffee pot, rather than expensive three-phase electric service.

Like the power plant, the Ilios engine is only about 30 percent efficient. But the Ilios captures 85 percent of the waste heat that’s normally thrown away to heat the water, increasing the efficiency of the system beyond that of an electric heat pump.

Because the Ilios uses half as much fuel as a comparable boiler, it also reduces CO2 emissions by about the same amount, an important factor for facilities concerned about their environmental impact. The Ilios uses emissions control systems similar to automobiles to keep pollutants such as CO and NOx to a minimum. An “Ultra” emissions package that produces near-zero pollutants is available for sensitive areas such as Southern California, New Jersey, and Massachusetts.

“Because the Ilios uses half as much fuel as a comparable boiler, it also reduces CO2 emissions by about the same amount, an important factor for facilities concerned about their environmental impact.”

Capturing the waste heat also allows the Ilios to make much hotter water than a traditional heat pump. Electric heat pumps are generally limited to a maximum temperature of between 120 and 130 degrees. While that may be warm enough for small residential uses, many commercial applications require water heaters to maintain temperatures of at least 140 degrees. The Ilios can efficiently produce water at up to 165 degrees.

The system’s heating capacity and performance are both affected by the climate where the system is installed. The heat pump water heater provides the most heat at the highest efficiency where the outdoor temperature is highest, such as in the South.

To maximize savings, buildings generally size the heat pumps to meet the entire heating load during the summer, when the heat pump’s output is greatest. The Ilios can be supplemented by a traditional boiler in colder seasons.

Several other factors affect the Ilios’s payback period:

  • Run hours. The more the Ilios runs, the more fuel savings it offers. That’s why buildings with large heating loads, such as hotels, hospitals, health clubs, and food and beverage manufacturing facilities, are ideal candidates. “Anywhere with a big boiler currently using 2,500 gallons of propane a month is pretty much an ideal candidate,” Lafaille says.
  • New construction or retrofit. Retrofit installations are fairly simple. In a warm climate, the installer would simply tie in the Ilios to the boiler loop; in a cold climate, an additional heat exchanger would be needed. But payback is fastest in new construction, where the Ilios can replace or reduce the need for an additional boiler and no additional installation cost is needed.
  • Incentives. As a form of mechanical CHP, the Ilios qualifies for the federal 10 percent Business Energy Investment Tax Credit. The credit extends to systems put into service by Dec. 31, 2016. Some utilities and other local programs offer additional incentives.

Like any new engine, the Ilios unit must be serviced with an annual oil change once a year. But the company estimates 95 percent uptime for the system, and service plans, which cost $1 per run-hour annually and include unlimited parts and labor, are factored into the company’s payback calculations. And while the product is in its infancy (there are currently only 12 Ilios machines in operation), Tecogen has been maintaining and servicing 1,500 CHP units across the country for decades.

“We’ve had our first Tecogen cogeneration module running in the field for 31 years,” Lafaille says. “It’s heating the pool at Harvard University. Probably every part on it isn’t original. But to the customer, they don’t see any changes. It just keeps running. There is maintenance involved, but it ends up being our responsibility, not the end user’s.”

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Jeffrey Lee