"Energy Efficiency is at the heart of energy affordability." Tony Earley, Chairman, CEO and President of PG&E Corporation

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San Francisco: PG&E Commercial Customers Get Inside Look at What Powers Transamerica Pyramid

By David Kligman

The 853-foot-tall Transamerica Pyramid is among the most energy efficient commercial office buildings in the United States. (Photos by David Kligman.)

SAN FRANCISCO—Since 1972, the Transamerica Pyramid has punctuated the city’s famous picture-postcard skyline.

At 853 feet, the distinctive landmark is the tallest building in San Francisco, as much an architecturally iconic image as the city’s Golden Gate Bridge or Coit Tower. It’s the third tallest building in California and the 32nd tallest in the United States.

What many may not know is that the 48-floor, 500,000-square-foot building has its own power generation system, which provides about 70 percent of the building’s electricity, as well as all its space heating and hot water needs.

At $4 million, the system, also known as a co-generation system, isn’t cheap. But it will pay for itself by 2014, about five years after it went online, saving the building about $700,000 a year in energy costs.

Learn more about the California model for energy efficiency

“It’s like any other capital improvement project that will save on energy consumption,” said Doug Peterson, chief engineer for the Transamerica Pyramid Center. “Overall that’s good for the building, the tenants and the environment. But if you’re saving energy, you’re saving dollars too.”

Energy Masters Forum showcases Pyramid project

On Tuesday (April 24), PG&E hosted its Energy Masters Forum at the Transamerica Pyramid. The utility invited engineers and property managers from hotels and other businesses to get an up-close look at the benefits and work involved in establishing and maintaining a cogeneration system.

The forums, which are held quarterly at various locations throughout PG&E’s service area, are designed to help medium and large business customers understand their options and educate them on PG&E programs.

About 700 PG&E business customers have co-generation systems, typically large buildings such as hospitals, prisons and hotels that require hot water.

So why would PG&E promote a business customer that’s producing less revenue for the utility? Chris Tufon, a PG&E tariff specialist, said the answer is simple.

Doug Peterson, chief engineer for the Transamerica Pyramid Center, points out a natural gas-fired turbo engine that’s part of the building’s co-generation system.

“My job is to educate customers so they can save more money,” Tufon said. “I want to educate them to make the best business decision, and that may be to have co-generation or not to have co-generation. Either way, when customers do well, we do well.”

There’s also a common misconception that PG&E makes more money based on selling more power. In California, energy sales are separate from profits. Some of the utility’s revenue is based on customers’ energy efficiency.

For his part, Peterson said the Pyramid Center’s involvement with PG&E has been just as important now that the co-generation system is up and running. He works closely with his PG&E account services representative, Juan Miller, on electrical and gas rate structure changes, rebates and re-commissioning services. Miller also helped when the Transamerica Pyramid received LEED gold certification in 2009 and LEED platinum certification in 2011 from the U.S. Green Building Council.

To date, the Transamerica Pyramid has received almost $1 million in rebates for its self-generation system and energy-efficiency programs, which include a current Energy Star rating of 98.

“The only thing I’m doing less of with PG&E is giving them money,” Peterson said.

Dedication, maintenance required

Running a co-generation system takes dedication. Peterson has a maintenance crew of seven employees who work 24 hours a day, five days a week.

The system, which is housed in the building’s ground floor garage, can be costly.

Peterson said he’s currently in the process of replacing two pieces of equipment—piping that wasn’t braced properly to handle the thermal dynamics of the hot water and heating exchangers that don’t adequately handle high water pressures for the building. Those two pieces of equipment will cost more than $200,000 and delay the payback date.

“It’s like a Ferrari,” Peterson said. “It performs well, it looks great but hey, an oil change is nothing like a normal oil change. It’s not like maintaining a normal piece of equipment. It’s going to save you a lot of money long term, and it’s the right thing to do for the environment, but you have to put a lot into it.”

Despite any drawbacks, the project has resulted in energy savings of 4.5 million kilowatt hours a year. The Transamerica Pyramid is also among the top 2 percent of energy-efficient commercial office buildings in the United States.

Many who attended the forum said they were enticed by a system that independently generates its own energy.

“I came away thinking this is a real, viable alternative and that people should really study this,” said Dennis Kettler, a chief engineer at a nearby office building. “When he talked about using the thermal capacity of it and you’re generating 100 percent of your heat and domestic hot water, that’s really efficient. That’s amazing stuff.”

E-mail David Kligman atdavid.kligman@pge.com.

This story originally appeared on pgecurrents.com.