Thermal Energy Corporation Chiller Plant Optimization
OptimumLOOP® delivers operational efficiencies and beats expected cost savings at North America’s largest district cooling system
Managing Growth Without Adding Capital Equipment
Thermal Energy Corporation operates the largest district cooling system in North America, providing reliable thermal services to the Texas Medical Center campus in Houston. Over four years, TECO’s peak chilled water demand grew by 9,000 tons, with another 9,000-ton increase forecasted in the following three years.
TECO found that improving efficiency was the most cost-effective way to manage this growth while continuing to meet its mission of delivering economical, reliable thermal services. The company partnered with Optimum Energy to identify optimization opportunities within an already highly efficient chilled water system.
A team of engineers from TECO, Optimum Energy, and Toshiba deployed OptimumLOOP® safely during the COVID-19 pandemic in under eight months, completing the work in time to realize efficiency gains before the summer peak season. Over the first seven months of operation, the project saved nearly 10.5 million kWh and reduced energy consumption by 6%, at an estimated cost savings of $356,000.
Two Interconnected Plants. One Massive System.
Plant Overview
Capacity & Campus
Further Optimizing an Already Reliable System
TECO has logged 100% reliability with no unplanned outages since 1992. With customers including a cancer center, a children’s hospital, two Level I trauma centers, and major research facilities, maintaining that record was non-negotiable — even as rapid load growth threatened to push the plant beyond the existing CHP system’s capacity.
Rapid Load Growth
Peak chilled water demand had grown by 9,000 tons over four years, with another 9,000-ton increase forecasted — pushing the plant toward the limits of the existing combined heat and power (CHP) system’s capacity.
Peak Demand Management
ERCOT records each user’s peak usage from June through September to set the following year’s demand charge. Reducing peak load by 2 MW before that window was critical to avoiding costly spot power purchases and coincident peak charges.
Zero Tolerance for Downtime
With patients at a cancer center, children’s hospital, and two Level I trauma centers depending on uninterrupted cooling, any optimization work had to preserve TECO’s 100% reliability record — achieved continuously since 1992.
Avoiding Capital Expenditure
Adding new electrical generation capacity to handle load growth would require multimillion-dollar capital investment. TECO needed to squeeze maximum efficiency from existing equipment first — and achieve payback in under two years.
Optimization Plus Business Continuity
Optimum Energy calculated that the project would free up 2.1 MW of peak power, save 14.6 million kWh per year, and achieve a 1.9-year simple payback. The solution focused on condenser-side optimization algorithms and a new optimized chiller-staging methodology, deployed safely during the COVID-19 pandemic in under eight months.
OptimumLOOP® automatically stages all chillers and the 8.8 million gallon thermal energy storage tank as an integrated whole, continuously collecting data about plant operations, outside conditions, and hundreds of other parameters to calculate optimal set points in real time.
As part of the project, TECO also integrated Optimum Energy’s Plant Diagnostics tool into its daily work processes, enabling the team to identify otherwise invisible reliability and efficiency opportunities — including approach temperature degradation on chillers — and better prioritize maintenance efforts across all shifts.
Savings, Reliability, and Deferred Capital Costs
Annual Operations Cost Savings
On track to exceed $500,000 in the first full year — all from software applied to existing equipment
Annual Electrical Energy Savings
Verified annual energy savings — with 10.5M kWh saved in the first seven months alone
Annual CO₂ Reduction
Carbon emissions reduced per year across the entire TECO campus
Peak Demand Reduction
Freed up within the existing CHP system’s capacity — deferring multimillion-dollar capital expenditure by several years
Energy Consumption Reduction
Reduction in total energy consumption achieved in the first seven months of operation
Estimated ROI
Simple payback achieved while preserving TECO’s 100% reliability record maintained since 1992
Beyond Energy: Operational Gains
The monthly analytics reports are very valuable. They give us insights into potential problems with our machines — starting with overall efficiencies and then diving deeper into details like approach temperature degradation on the chillers. Combined with Optimum’s experience from other sites, we get a different set of eyes to help drill down into what the machines are telling us.
Growth Without Capital Equipment.
“The collaboration between Optimum Energy and TECO has allowed us to accommodate load growth without adding capital equipment. This is always the first choice, and the efficiency gains provide savings every day of the year. This is a win-win for Optimum Energy, TECO, and TECO’s customers,” says Steve Swinson, CEO of TECO.
The TECO project demonstrates that even North America’s largest and most reliable district cooling system holds meaningful untapped efficiency. By deploying OptimumLOOP® and Plant Diagnostics across two interconnected plants, TECO reduced peak demand by 2.1 MW, deferred multimillion-dollar capital expenditures by several years, and delivered savings every day of the year — all without compromising its 100% reliability record.
