International Journal of Sustainable and Green Energy 2016; 5(4): 59-70 http://www.sciencepublishinggroup.com/j/ijsge doi: 10.11648/j.ijrse.20160504.12 Cost-Effectiveness Opportunities for Thermal Energy Storage Systems: A Case Study of School Building in Saudi Arabia Badr Habeebullah 1 , Rahim Jassim 2 , Nedim Turkmen 1 , Ahmad Bokhary 1 , Majed Alhazmy 1 1 Mechanical Engineering, King Abdulaziz University, Jeddah, Saudi Arabia 2 Saudi Electric Services Polytechnic (SESP), Baish, Jazan Province, Kingdom of Saudi Arabia Email address: bhabeeb@kau.edu.sa (B. Habeebullah), mhazmy@kau.edu.sa (M. Alhazmy), r_jassim@sesp.edu.sa (R. Jassim) To cite this article: Badr Habeebullah, Rahim Jassim, Nedim Turkmen, Ahmad Bokhary, Majed Alhazmy. Cost-Effectiveness Opportunities for Thermal Energy Storage Systems: A Case Study of School Building in Saudi Arabia. International Journal of Sustainable and Green Energy. Vol. 5, No. 4, 2016, pp. 59-70. doi: 10.11648/j.ijrse.20160504.12 Received: June 11, 2016; Accepted: June 20, 2016; Published: July 6, 2016 Abstract: Air conditioning in houses, office buildings and schools consume high portion of the generated electricity in Saudi Arabia. This paper presents a study of the economic opportunities afforded by installing an ice storage system to existing air conditioning plants of a school in Jeddah, Saudi Arabia. In this paper, the assumptions are i) fixed interest rate of 10%, ii) a tenure of 10 years and iii) estimated operational tariff structure depending on both the number of operating hours and the ambient temperature. The study examines both full and partial load storage scenarios then calculates the effect of various pricing tariffs on cost optimization. The results show that the current fixed electricity tariff rate of $0.0267/kWh which is not economically feasible. Combining both the energy storage and an incentive time structured rate shows reasonable daily bill savings. For a base tariff of $0.07/kWh during daytime operation and $0.0267/kWh for the off-peak period, savings of $33/d and $73.36/d is achievable for full load storage and partial load scenarios, respectively. These savings will increase to $159/d for full load storage and $124.06/d for partial load storage after 10 years. Keywords: Ice Storage, Cooling Load, Economic Analysis 1. Introduction The air conditioning (A/C) systems in Saudi Arabia consume more than 60% of the total electric energy available for buildings. The high consumption rates encourage the authorities to work on both increasing the energy generating rates and reducing the demand. Therefore, shifting the energy consumption from peak to off-peak hours and improving A/C systems performance are necessary for fulfilling the electricity demand reduction. The main purpose of using a thermal storage system (TES) is to shift the electricity peak load associated with buildings' cooling from peak time to off-peak periods. When applying variable tariff policy, TES becomes a good candidate for utilities to inforce demand management for many users. Cold TES technology provides a feasible solution for solving peak load problems (Yau and Rismanchi [1]; Parameshwaran et al [2]; Habeebullah [3]). The TES is suitable for buildings having discontinuous working hours such as offices, schools (Michael [4]), court-halls, campus buildings (Yau and Rismanchi [1]), subway stations (Keisuke [5]) and many others (Habeebullah [3]). Applying different tariffs based on the day time of high and low consumption levels creates opportunities for the use of energy storage systems. Ihm et al [6] presented a TES simulation model within the EnergyPlus (EnergyPlus [7]) buildings analysis package. Henz et al [8] carried out an investigation of the possible savings in the electricity bill for various storage strategies, different combinations of chiller types, building type and weather conditions. Sanaye and Shirazi [9] performed a study on the thermo-economic modeling and optimum design of an ice TES for A/C applications. The same study took into consideration the penalty for CO 2 emission. Sebzali et al [10] have studied the implementation of a chilled water thermal system in Kuwait city and have demonstrated that this reduces the peak power demand of A/C systems.