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Pitch

Heat pump dryers will reduce US GHG emissions by 61 million tons/year and benefit vulnerable communities, while saving $12.5 million/year


Description

Summary

84 million tons of CO2 or 1.5% of the United States’ annual CO2 footprint stems from drying garments and fabrics.  This drying process is present in dozens of industries ranging from healthcare to hospitality.  CO2 emissions from garment and fabric drying would be reduced by 61 million tons CO2e per year if an effective heat pump clothing dryer was available for US businesses to purchase and utilize.

                Heat pump dryers (HPDs) function by the same principals as a refrigerator or air conditioner.  Rather than generating heat like a conventional clothing dryer, HPDs contain a cold coil (evaporator) that absorbs heat and a hot coil (condenser) that rejects heat.  Energy is moved between the two coils using a refrigerant.  The HPD uses a blower to push an airstream over damp clothing and through the cold and hot coils in this sequence.  The cold coil condenses water vapor in the airstream.  The airstream is then reheated by the hot coil and pushed back over the damp clothing to begin the cycle again.  Because HPDs move heat between cold and hot coils, rather than generating it, they are able to dry clothing with less than 50% of the energy required by conventional electric and natural gas dryers. 

In order to make a heat pump dryer that is practical for businesses, it is necessary to design the bulky heat pump components to fit into a device no larger than a conventional clothing dryer.  This project has overcome this final technological hurdle and aims to commercialize and deploy this new technology in order to help a host of industries reduce greenhouse gas emissions and improve their bottom lines.


Is this proposal for a practice or a project?

Project


What actions do you propose?

We propose introducing an economically desirable heat pump dryer into the US market by taking the following actions:

  1. Designing and building a fully functional prototype commercial heat pump dryer

A working prototype heat pump dryer will be constructed at relatively modest cost and will demonstrate to potential customers and investors that heat pump dryers are the obvious choice for industries that purchase commercial drying equipment.  In addition, the successful construction of a prototype would allow us to work out many details that would improve the end user experience.

  1. Attracting outside capital.

Manufacturing an effective heat pump dryer will require that procurement of eight major machine tools as well as ~10,000 square feet of manufacturing space.  In addition, a significant upfront investment in material and skilled personal will be required because of the time gap between the first unit produced and the first unit sold.  The total cost of all these investments has been calculated to be ~$1,000,000.  To achieve this, it will be necessary to attract venture capital to the project or outsource initial production while the business builds up the capital required to bring production “in-house”.

  1. Initial production run and sales

The initial production run will consist of ~100 units and be made available to local laundromats, laundry machine dealers, and other customers on a trial basis.  This will provide an initial round of customer feedback that can be incorporated at relatively low cost.

  1. Market share expansion

After incorporating feedback from the initial production run, we will focus on expanding our share and realizing the impacts of the technology.  The initial target markets will be areas with the highest energy costs (northeastern US and California).  From there, we will turn our attention to markets with lower energy costs.  We have calculated that the economic value of heat pump dryers disappears if electricity costs less than $0.06/kWh.  This means that our product will not be of interest to consumers in certain areas of the southern and pacific northwestern regions of the US.

  1. International expansion

If stakeholder interest is present, we will make our product available in international markets.  This will require significant product redesign in order to comply with international electrical standards and other regulations.  As a result, the impact of deploying heat pump dryer technology internationally has not been included in this proposal.


Who will take these actions?

  1. Hermit Technologies

Hermit Technologies is the company tasked with designing, manufacturing, marketing and distributing a heat pump dryer within the US market.  At present, Hermit Technologies consists of this proposal’s author.  When funded, the team will be expanded to include leads on mechanical design, marketing and finance, manufacturing, regulatory compliance, and customer interfacing. 

  1. Outside Capital Providers

Owing to the costs associated with manufacturing heat pump dryers, it is advantageous for Hermit Technologies to seeking outside capital at every opportunity.  Outside capital providers either expect their investment to turn a profit or yield a particular social outcome.  Hermit Technologies will communicate how our business can meet both of these goals.

  1. Laundry Equipment Consumers

For this proposal to be successful, it is necessary for consumers to realize the benefits of our technology and actually purchase the heat pump dryer that we offer.  Laundry equipment consumers fall into two categories.  The first category consists of vended laundry providers and similar operations, for whom laundry services are a core competency.  In order to attract these consumers, it is essential that Hermit Technologies demonstrate that our dryer are safe, reliable and effective in demanding environments with nearly 24 hour utilization.  Additionally, since our technology is new and unfamiliar, we must go a step farther and make machines that are actually a pleasure to use, instead of merely being “usable”.

         The second category of laundry equipment consumers consists of organizations for whom laundry is more or less unrelated to their core competencies.  This group includes hospitals, universities, hotels, etc.  To reaching these consumers will require that our machines be as easy to purchase, install and operate as possible.  If the machines cannot replace existing units with minimal hassle, then it is unlikely that these consumers will adopt the new technology.


Where will these actions be taken?

  1. Design and build a fully functional prototype commercial heat pump dryer
    1. Location: Columbus, OH
    2. Reasoning: This proposal’s author currently attends Ohio State University (OSU), which is located in Columbus, Ohio.  The technical resources required to construct a prototype are available through OSU, and with more than 6,000 engineering students on campus, OSU is an ideal environment for building the Hermit Technologies team.
  2. Attract outside capital
    1. Locations: Columbus, OH; Chicago, IL, Boston, MA; New York City, NY; San Francisco, CA; Los Angeles, CA
    2. Reasoning: Though not an exhaustive list, each of these cities has a significant base of venture capitalists and other funding resources that are able to understand and engage with high-technology start-ups. 
  3. Initial production run and sale
    1. Location: Near Columbus, Ohio
    2. Reasoning:
      1. Production factor costs, including labor, material, energy, and real estate are much cheaper in central Ohio, relative to many other regions of the country.
      2. Central Ohio has significant technical talent and is home to 25 fortune 500 companies.  As a result, the business climate is very strong even though factor costs are relatively low.
  4. Expansion
    1. Locations: San Francisco, CA; Los Angeles, CA; Chicago, IL; Boston, MA; New York City, NY; Hawaii
    2. Reasoning: Cities contain large renter populations who disproportionally rely on vended laundry solutions to wash and dry their clothing.  Vended laundry providers are likely to be the largest consumer of heat pump clothing dryers.  Additionally, each city listed has disproportionately high energy costs and significant climate goals, both of which enhance the market value of heat pump dryers.
  5. International Expansion
    1. Locations: Canada and Mexico; exact location TBD
    2. Reasoning: Though international expansion plans are not formally determined, numerous cities in Canada and Mexico would make a good starting point for international expansion.  This stems from the fact that unified North American electrical standards would minimize the amount of product redesign necessary to enter these markets.  Additionally, the US has trade agreements with both of these countries that make it relatively easy to export machinery to either location.


In addition, specify the country or countries where these actions will be taken.

United States


Country 2

No country selected


Country 3

No country selected


Country 4

No country selected


Country 5

No country selected


Impact/Benefits


What impact will these actions have on greenhouse gas emissions and/or adapting to climate change?

Through capturing just 40% of the commercial laundry machine market, heat pump dryers will reduce the United States’ CO2 emissions by 62 million tons per year.  This calculation is performed using the existing Hermit Technologies heat pump dryer design and comparing it cycle time and electrical power input against the cycle times and power inputs of equivalent capacity electrical and natural gas driven conventional clothing dryers. 

The following data points are known:

  1. Power input required for Hermit Technologies’ heat pump dryer design – 5.7kW
  2. Energy input required for competing conventional designs – 10.8 kW
  3. Cost of manufacture - $8,000
  4. CO2 intensity of an average kWh of electricity in the united states – 0.000636 tons CO2e/kWh
  5. The Hermit Technologies heat pump dryer has a ½ hour cycle time

The following data points are assumed:

  1. Heat pump dryers will capture ~40% of the United States’ commercial garment and fabric dryer market after five years
  2. Once manufactured, dryers will operate an average of 10 cycles (5 hours) per day, 365 days/year
  3. CO2 emitted during the manufacturing process for one heat pump dryer is consistent with the CO2 emitted by manufacturing $8,000 of commercial laundry equipment in the year 2002 based on Carnegie Mellon’s EIO-LCA model. – 4.54 tons/machine
  4. Competing electric and natural gas dryers have a ½ hour cycle time

Based on the data points above, the CO2 emission reduction under this proposal is calculated as follows:

CO2 savings = (conventional machine power rating-heat pump dryer power rating)*(daily hours of operation)*(365 days/year)*(# of heat pump machines in service)*(CO2 intensity of electricity)

CO2 savings = (10.8kW/machine-5.7kW/machine)*(5 hours/day)*(365 days/year)*(4,910,000 machines in service)*(0.000636 tons CO2e/kWh) = 61,600,000 tons CO2 eliminated/year

CO2 payback period = (tons CO2 emitted during manufacture/machine)/(CO2 emissions reduction/machine/year)

CO2 payback period = (4.54 tons/machine)/(5.92 tons/machine/year) = 0.766 years

Financial payback period = (Cost of heat pump dryer – Cost of equivalent conventional dryer)/((annual electricity savings)*(cost of electricity))

Financial payback period = ($10,091/dryer– $5,500/dryer)/((9312 kWh/year)*($0.10/kWh)) = 4.97 years

It is worth noting that most corporations of significant size have some form of climate action plan specifying how they intend to reduce greenhouse gas emissions in the next decade or so.  Many of Hermit Technologies’ potential customers, such as major hospital networks and universities specify that they will achieve their climate goals through the purchase of “clean electricity”.  Clean electricity is priced at a premium relative to conventional electricity,


What are other key benefits?

This project will benefit vulnerable lower income Americans who are more likely to rely on vended laundry, the price of which is highly sensitive to energy costs. Depending on location, energy can account for as much as 50% of the cost to dry a load of clothing at a laundromat.  In addition, it will confer up to $4.5 billion/year in energy savings to hospitals, health and recreation facilities, hoteliers, vended laundry providers and other actors who do significant quantities of laundry as part of their business operations.  Manufacturing the machines will provide up to several dozen high quality jobs and significant tax revenue in central Ohio.  In addition, sale of these machine will generate up to $5 billion dollars in additional revenue for machinery dealers and service providers.

Finally, it is worth noting that the usage of vended laundry increases during economic recessions.  As a result, these machine play a role in buffering individuals in economic distress from high energy costs during economic recessions.


Costs/Challenges


What are the proposal’s projected costs?

  1. Initial Prototype Costs
    1. materials - $2000
    2. Labor - $3000
    3. Off the shelf components - $4000
    4. Small scale coil fin press and tooling - $3000
    5. Total
  2. Capital Costs
    1. Three axis machining center - $120,000
    2. CNC plate roller – 5’ width and 10GA mild steel bending capacity - $50,000
    3. Tube bender/tube end former - $50,000
    4. 2D laser cutter – Trumpf TruLaser 1030 fiber - $250,000
    5. CNC press brake - $75,000
    6. Welding robot - $75,000
    7. Coil  fin press line - $100,000
    8. Engineered assembly line for product and material flow - $100,000
    9. 1st year’s rent - $30,000
    10. 1st year’s business insurance and general liability insurance - $15,000
    11. Total: $850,000
  3. Manufacturing and Sales Costs per Unit
    1. Materials and off the shelf components - $3500
    2. Labor - $2000
    3. Business overhead $1000
    4. Manufacturer’s profit margin (35%) - $2275
    5. Dealer’s profit margin (15%) - $1316
    6. Total cost to customer – per unit - $10,091


Timeline

  1. Company setup and incorporation
    1. Start: 6/29/2017
    2. Complete 6/29/2017
  2. Initial prototype funding and development
    1. Start: 06/01/2017
    2. Complete: 01/31/2018
  3. Marketing strategy development
    1. Start: 06/01/2017
    2. Complete: 12/30/2017
  4. Attracting outside investors
    1. Start: 09/01/2017
    2. Complete: 12/30/2018
  5. Two - five refined prototypes
    1. Start: 06/01/2018
    2. Complete: 08/23/2018
  6. Acquisition of manufacturing equipment, rental space and insurance protections
    1. Start: 01/01/2019
    2. Complete: 06/01/2019
  7. Initial production run with product available for sale
    1. Start: 07/01/2019
    2. Complete: 07/30/2019
  8. Expansion into initial target markets
    1. Start: 08/30/2019
    2. Complete: Ongoing

Impact Timeline:

  1. Start of Impact
    1. This project will have an positive impact on GHG emissions beginning no later than 07/30/2019, when the initial production run is placed in service
  2. Achievement of maximum impact
    1. These machines are expected to capture their maximum market share in five years.  As a result this project will reduce CO2 emissions by 61 million tons per year by 2024.
  3. Medium term impact (15-50 years)
    1. It is reasonable to expect clothing dryers to be a fixture of American laundry for as long as clothing exists.
    2. Over the next 50 years, the greenhouse gas emissions reductions associated with this project will gradually diminish as the electricity system decarbonizes.  However heat pump dryers will still offer a huge advantage over conventional designs because of their energy efficiency and ease of installation.
  4. Long term Impact
    1. Ultimately, the heat pump dryer technology will fade into obsolesce.  By the time this occurs, this proposal will have prevented the emissions of several gigatons of CO2.


About the author(s)

Cliff Goertemiller graduated Harvard University in 2017 with a B.A. in environmental science and public policy.  While working with university staff toward Harvard’s 2016 greenhouse gas reduction goal, Cliff gained a deep understanding of the challenge involved in reducing CO2 emissions from the built environment without sacrificing performance.  Cliff currently lives in Columbus, Ohio and is pursuing a master’s degree in mechanical engineering at The Ohio State University.

                In addition to environmental science and engineering, Cliff founded Kaycee Candles, a manufacturer and distributor of clean burning beeswax candles.  This company sold over 30,000 beeswax tea lights and developed a pneumatic press technology to manufacture these tea lights more efficiently.  Through this process, Cliff developed a comprehensive understanding of product design and a wide range of manufacturing processes.

                Within this project, Cliff will make the initial investment of time and effort required to incorporate Hermit Technologies, produce a viable design, secure funding for a prototype, and build the company’s initial design, sales, manufacturing and management teams.  Cliff intends to remain active in Hermit Technologies throughout its entire lifecycle.  However, it is often the case that effective company founders are not effective long-term as CEOs, and this fact is accounted for in long term plans for this project.


Related Proposals

There are no related proposals listed.  However, some sustainable living advocates will tout the benefits of cloths lines, drying racks, and passive drying solutions.  These methods are certainly effective in areas with warm weather, dry climate and low population density.  However, in nearly any other situation, laundry volume and hygiene standards require a machine to execute the drying process.


References

  1. Kieser Permanente 2025 Environmental Goals
    1. https://share.kaiserpermanente.org/article/kaiser-permanente-pledges-bold-2025-environmental-performance-to-benefit-people-and-planet/
  2. National Center for Assisted Living (NCAL)
    1. https://www.ahcancal.org/ncal/facts/Pages/Communities.aspx
  3. Cruise Line International Association
    1. https://www.cruising.org/docs/default-source/research/clia-2017-state-of-the-industry.pdf?sfvrsn=0
  4. International Health Racquet and Sports Club Association
    1. http://www.ihrsorg/about-the-industry/
  5. National Center for Educational Statistics
    1. https://nces.ed.gov/fastfacts/display.asp?id=84
  6. American Hospital Association
    1. http://www.ahorg/research/rc/stat-studies/fast-facts.shtml
  7. STR Group
    1. http://www.businesstravelnews.com/Strategic-Sourcing/U-S-Hotel-Supply-Breaks-5-Million-Room-Mark
  8. National Multihousing Council
    1. http://www.nmhc.org/Content.aspx?id=4708
  9. Washington Post
    1. https://www.washingtonpost.com/news/wonk/wp/2015/01/06/the-u-s-has-more-jails-than-colleges-heres-a-map-of-where-those-prisoners-live/?utm_term=.eb97804fa709
  10. NPD Group
    1. https://www.npd.com/wps/portal/npd/us/news/press-releases/us-total-restaurant-count-increases-by-4442-units-over-last-year-reports-npd/
  11. Coin Laundry Association
    1. http://www.coinlaundry.org/investor-resources/additonalinfo
  12. EIO-LCA Life Cycle Calculator
    1. http://www.eiolcnet/
  13. CO2 per kWh
    1. https://www.eigov/electricity/state/unitedstates/