Periodic Reporting for period 1 - ECOOL (Evaporative Cooling Technologies for dry and humid climates) Reporting period: 2016-06-01 to 2016-08-31 Summary of the context and overall objectives of the project Energy demand for building cooling has increased sharply worldwide in the last few years. While demand for heating has started to flat out due to energy efficiency, cooling demand continues to grow and its expected to surpass heating’s by 2025 across Europe. Currently, in hot climate countries, the highest share of building energy use is mainly due to space air conditioning using traditional HVAC systems. For example, in the Middle East, it accounts for 70% of building energy consumption and approximately 30% of total consumption. Currently, mechanical vapor compression coolers (MVC) are commercially dominant despite their intensive energy use and low performance in hot climate. Evaporative cooling systems have become a viable alternative to the conventional vapor compression air conditioners. They are cheaper to install, maintain and operate than the traditional AC. However, a number of serious drawbacks significantly limits the scope of their applications. The evaporative cooling systems require dry air conditions to be effective, they add humidity to the air and a significant amount of water is required for the adiabatic process.The RIDEC and DEC systems can generate cooling energy as effective as than any commercial model of MVC, consuming 5-10 times less of electrical energy.The objectives of the project are to carry out: (1) last stages of product development, transition from a tested pre-commercial unit to a commercial design fully automated; (2) testing within several operational environments; (3) development of the supply and commercial network, as well as preparing the company for sustainable growth. The superior performance of the RIDEC and economic and environmental advantages for the end user, provide for a projected growth over the first five years to reach cumulative sales of €70 million. Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far In this feasibility study we have analyzed the viability of exploiting our proprietary technology to provide a cost effective, low environmental impact alternative for cooling applications from technical, commercial and financial point. From a technical point of view, the main take away from the action is the re-structuring of our product roll-out strategy. We considered the current stage of development of the RIDEC and DEC products, prepared a work plan to take the current versions to a commercial stage and their respective market performance (i.e return of investment and potential revenues). As a result, we updated our product roadmap strategy. We have decided to follow a lean strategy of growth. We will focus on the RIDEC which provides the most attractive growth vector for the company at this stage. Moreover, we have been able to evaluate our cost assumptions and advanced our efforts towards securing the relevant assembly capacity by pursuing manufacturing agreements with suitable companies. Lastly, we have prepared a complete work plan to reach the commercial version of the RIDEC. We have defined the automation capacities we will require for it to meet customer expectation, and planned for the resources that will be necessary for this final stage of development. From a commercial point of view, we have validated our market growth assumptions. The profitability of the business case for the end user is also boosted by strong regulatory and economical drivers, providing a promising potential market. We can confirm the commercial feasibility in the originally identified market segments, starting in the Mediterranean region and Middle East area. We have started to select suitable partners to distribute our product in our target markets. As a result, we have reached a verbal agreement with Sedical, a Spanish based company dedicated to the distribution and marketing of cooling technologies. We expect that our partnership will also materialize into a joint phase 2 application We see very beneficial to complement our capacities with the market experience of Sedical. An analysis of potential risks and barriers have been carried out, resulting in the development of mitigation strategies to secure the milestones in our growth strategy are achieved.From a financial point of view, after validation of the cost at which the RIDEC will be produced, we have concluded that end users will benefit from energy savings when selecting the RIDEC instead of traditional vapor compression air conditioning systems. This is key to support our business growth based in progressive substitution of less efficient technologies. We have projected a conservative growth scenario, where demonstrated technology and the unique selling points provides for an impactful market entry and sustainable growth. It has been proven that the RIDEC will provide growth for the company in terms of cash flows and employment creation, which demonstrates the financial viability of the project. Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far) Vitality vector’s value proposition to its clients aligns profit with environmental sustainability. Our innovation strategy is directed at turning sustainability challenges into profitable business models. The RIDEC will have a threefold impact: ENERGY. The benefits of improving energy efficiency extend well beyond financial savings, relating also to improved energy security, higher productivity for businesses and reduced greenhouse gas emissions. Approximately 40% of the emissions reductions required by 2050 would potentially come from energy efficiency. The RIDEC system reduces energy consumption by up to 90% in dry climates and DEC system reduces energy consumption by 40% in humid climates compared to the predominant MVC technology. WATER. The RIDEC has been designed to attain the environmental and health benefits of evaporative cooling while avoiding its major environmental drawback, water consumption. It has been a priority of Vitality Vector from the beginning of our R&D and product development. Water conservation and contributing to overcoming global water challenges is at the core of Vitality Vector. Water consumption is reduced to 2 liters per kW of cooling produced, which compares to 5.72 liters that will be required to produce the excess energy to power a conventional AC. The RIDEC does not impact water quality of the source, while generation of energy can also contribute changes in physical and chemical properties of the water. This impacts the ecosystem of the water source, and in extreme cases contamination of ground and underground water. With Energy production responsible of 15% of total global water withdrawals, the magnitude is enormous.PUBLIC HEALTH. it contributes to improve Indoor Air Quality (IAQ). Mechanical air conditioning consists on cooling the indoor air by recirculating it through cooling coils that have been cooled by a refrigerant. Evaporative cooling on the other hand cools buildings by bringing in outside air. The rate of outside air flow into the building to achieve this cooling is typically several times that required to satisfy any regulatory or code minimum flow requirement and is adequate to assure that a healthy environment is achieved and maintained. Availability of fresh air takes special importance in public spaces such as hospitals, elderly homes and schools. COMPANY LOGO
