Rancho Palos Verdes City Council
   

JANUARY 17, 2006ENERGY EFFICIENCY OPPORTUNITIES JANUARY 17, 2006ENERGY EFFICIENCY OPPORTUNITIES JANUARY 17, 2006ENERGY EFFICIENCY OPPORTUNITIES



TO: HONORABLE MAYOR AND COUNCILMEMBERS

FROM: CITY MANAGER

DATE: JANUARY 17, 2006

SUBJECT: ENERGY EFFICIENCY OPPORTUNITIES

RECOMMENDATION
Hear a presentation by the South Bay Energy Savings Center.

BACKGROUND
For the past five years, rising energy costs and challenges with energy supplies have resulted in an unprecedented increase in energy prices. These increased costs have placed a greater strain on the City budget, as well as tapped the discretionary income of both residents and the business community.

In response to the ongoing energy crisis, the South Bay Cities Council of Governments (SBCCOG) has been working closely with Southern California Edison and the Southern California Gas Company to develop and implement several important programs and initiatives. The SBCCOG and its energy consultant will provide an overview of these initiatives, as well as outline a number of opportunities that exist for the City of Rancho Palos Verdes in the next several years.

Mayor Wolowicz has requested that the SBCCOG South Bay Energy Saving Center make a presentation to the City Council on energy efficiency opportunities this evening.

DISCUSSION
The SBCCOG has been very active addressing the ongoing energy crisis. In addition to operating the South Bay Energy Savings Center, which serves as a central clearinghouse for valuable energy efficiency programs, the SBCCOG completed a comprehensive assessment of energy efficiency opportunities throughout the residential and commercial sectors of the region. It then went on to conduct assessments of over 60 facilities in 14 of its member agencies uncovering a number of energy efficiency improvements that could produce annual savings of over 4 million kilowatt-hours (kWh) of electricity, over 15,000 therms of natural gas and over $3.3 million in combined electricity and natural gas cost savings over 5 years ($663,000 per year).

The SBCCOG is moving to the next logical step which is assisting its members to capture these potential savings. Currently, it is pursuing a program to aggregate public agency projects to gain economies of scale that would reduce overall costs and improve the cost-effectiveness of these projects. Several purchasing initiatives are planned for 2006. The first initiative, which is a straightforward aggregation of the purchase of simple devices that save energy in vending machines, could save individual agencies more than 40% on the cost of these devices compared to purchasing on their own. Based on the anticipated participation by cities alone (50 units), this one initiative could result in over 65,000 kWh and $10,000 in energy cost savings per year. Extending this initiative to local school districts (as has been suggested by some cities) could double the value of the initiative.

The program will build on this initiative to pursue more comprehensive projects that involve voluntary participation in energy efficient lighting retrofits, heating, ventilation and air-conditioning improvements, pump efficiency improvements, and others in South Bay city facilities.

Additional opportunities exist to assist the local community to improve its energy efficiency during remodels and reconstruction of existing commercial facilities. It is not uncommon to reduce the energy consumption of retrofitted commercial facilities by as much 50%. Additionally, new construction projects can take advantage of the growing interest and trend toward more sustainable green building practices that leverage a small initial investment into significant returns over the life of the building. Specifically, opportunities exist for the City Council to work proactively with the current developers of projects like the Trump National Golf Course development and the new Terranea Resort Hotel.

Energy costs have become a primary factor in determining the direction of the broader economy. In addition, energy costs have now become a greater burden to the residents and businesses that support the local tax base. Significant opportunities exist for cities to actively engage in supporting and promoting programs and initiatives to create significant energy and cost savings, thereby retaining dollars in the local economy.

Prepared by:

Michele M. Swanson, Environmental Deputy
South Bay Energy Savings Center
South Bay Cities Council of Governments

Reviewed by:

Les Evans
City Manager

PUBLIC FACILITIES
ENERGY EFFICIENCY PROGRAM (EE+) WORK PLAN
2006-2008
The SBCCOG recently completed a pilot project to evaluate the potential for achieving higher levels of energy efficiency in public facilities by working through a natural “aggregator” of public agencies (e.g. a Council of Governments). The 2005 pilot project was deemed successful in that it identified potential projects that could save SBCCOG member agencies over 4 million kWh of electricity savings, over 15,000 therms of gas savings and over $3.3 M in electricity and gas cost savings over 5 years ($663,000 per year).
This document is a draft of the proposed Work Plan for 2006 that are designed to achieve these energy and cost savings. The overall objective of the program is to reduce costs through greater economies of scale and joint procurement, and improve the delivery of energy efficiency services through a collaborative approach that leverages best practices. The success of our efforts in 2006 will largely determine the ability to continue this effort and expand its benefits to your agency in 2007-2008.
Facility Assessments and Identified Energy Conservation Opportunities
Initial facility assessments were completed that identified a comprehensive list of potential Energy Conservation Opportunities (ECOs) from a population of over 60 facilities in 14 cities. Due to limitations in the initial pilot project, these assessments were more limited in scope than would be the case in a full energy audit.

A summary of the ECOs found as a result of these assessments is found in Table 1.

Table 1: Summary of ECOs

 

Based on the experience of the program team, an expansion of this effort to include all facilities (including pump stations, street lights, etc.) in all South Bay cities and school districts would likely produce energy and cost savings in excess of 10 million kWh, 100,000 therms and $8.6 M in electricity and gas cost savings over 5 years ($1.7M per year).
Due to time limitations, many measures were excluded in the first round of assessments that will be more closely considered in the coming months, including: building envelope measures (e.g. added insulation, window tinting, energy efficient roofs, etc.), street lamps, conservation efforts, pump testing and repairs, computer network energy management systems, building recommissioning and self-generation (e.g. solar).
Potential Collaborative Projects
The following projects have been identified as initiatives that could be considered for collaborative project development in 2006:

1. Vending Machine Controllers purchase and installation (see attached Plan).
2. Lighting upgrades, including T12 to T8 retrofits and 1st-generation T8 to more efficient, 3rd-generation T8 relamping.
3. Computer Network Energy Management Systems
4. Heating, Ventilation and Air-conditioning (HVAC) - Installation of adjustable-speed drives (ASD) and other upgrades.
5. Pump testing and efficiency improvements.
6. Building recommissioning.
7. Boiler tune-ups and replacement.
8. Other energy projects to be considered:
a. Solar photovoltaic systems.
b. Window film and shading.

Technical Resources: Assistance and Facility Assessments
The project will expand on initial assessments completed in 2005 to establish better estimates of costs, savings and implementation steps necessary to pursue those ECOs that are selected by agencies. If necessary, more detailed audits, monitoring, and analysis of systems will be conducted as needed.
Project Development and Procurement
The Program will coordinate joint procurement of various energy efficiency products and services. This element will be important for the overall effort since project development and procurement is one of the more time consuming and difficult parts of the overall process. In addition, public agency personnel procure energy efficiency services only very infrequently. This program will provide experienced personnel in this procurement process, ensuring that the agencies are provided the best options, regardless of any inherent bias of a particular contractor or vendor. The goals are to reduce overall costs for both the procurement process as well as the services delivered through economies of scale.

One of the first joint procurement efforts will be for Vending Machine Controllers (see attached). Initial discussions with the vendor suggest that using this approach, agencies will save between 31% and 48% (depending on the quantity of the purchase) compared to the costs by procuring these devices on their own.
Project Incentive and Financing
The utilities will “reserve” incentive funds once an agency commits to pursuing a project. The Program will either complete incentive applications of assist agencies with applying for utility incentives. Not only is the project team very familiar with various program administration requirements, the process will be significantly streamline for all parties. For example, the Vending Machine Controller project will have one application that provides incentives for hundreds of units that would normally required 15 to 35 individual applications from agencies.

For those project costs not covered by the incentive, the Project Team will work with agencies to assist with accessing financing for the remainder of the project costs (e.g. CEC low-interest loans, on-bill financing, etc) and if necessary, providing support to secure City Council support for energy efficiency efforts.
Project Management
The Project Management Team will include Program staff/ consultants as well as agency staff for the respective projects. The Program will provide the necessary experience to ensure the projects are implemented in a timely and cost-effective manner. Frequent, periodic updates of project status and issues will provide management with the ability to intervene and correct problems in a timely fashion.