ct’s standardized energy-savings performance contracting ... · pdf filect’s...

CT’s Standardized

Energy-Savings Performance Contracting (ESPC)

Program

Andrew Brydges Director, Institutional Programs Clean Energy Finance and Investment Authority (CT Green Bank) Matt Cohen Program Manager, CT ESPC Program Department of Energy and Environmental Protection (DEEP)

January 2015

Agenda

▪ What is Energy Savings Performance Contracting? – Why should a municipality/agency do one?

– Who benefits and when?

▪ How does the CT ESPC program work?

▪ How would I pay for an ESPC project?

▪ How do I take first/next step?

▪ Project Examples in CT

What is ESPC?

▪ Implementation of energy saving measures, paid for by

guaranteed savings from future operating budget

▪ Approach is over 30 years old, approx. $4.1 billion market

in U.S. in 20131

– “SMUSH” Sector > 50% of ESPC Market

1 Lawrence Berkeley National Laboratory, “Current Size and Remaining Market Potential of U.S. ESCO Industry”. (Presentation to Energy Services Coalition, August 13, 2013)

ESPC Concept

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

2005 2010 2015 2020 2025 2030 2035 2040

POST-RETROFIT UTILITY COSTS

Retrofit

UTILITY COSTS

(BASELINE)

Why ESPC?

Repurpose wasted utility dollars to:

▪ Address deferred maintenance

▪ Eliminate costly emergency

repairs

▪ Upgrade to high efficiency

energy systems

▪ Stabilize energy costs, improve

budget accuracy

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=CCPR-ONN_FPHxM&tbnid=Djmmr3dXpTl7-M:&ved=0CAYQjRw&url=http://www.mills-inc.com/service/&ei=fQInU9fXIcbokAeo5IC4Bg&bvm=bv.62922401,d.eW0&psig=AFQjCNGjcb3vJxkg9k53AakuznXV6Vuxvw&ust=1395151844306906

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=dLEuIOI_no8nIM&tbnid=waU3f0VXVTfnuM:&ved=0CAYQjRw&url=http://passipedia.passiv.de/passipedia_en/planning/non-residential_passive_house_buildings/passive_house_schools/passive_house_schools_requirements&ei=0QMnU9LoIYmrkAeo7ICwDQ&bvm=bv.62922401,d.eW0&psig=AFQjCNEmyileuJt7WX0CXDZ_XMnIAppXSw&ust=1395152191577946

Aggregated Measures Balance Payback

1-5yr Payback

– High Efficiency Lighting

– Optimized energy

management systems

– Low flow fixtures

10-20+yr Payback

– Advanced HVAC Systems

– Windows and building

weatherization

– Renewable energy

systems

Aggregate Payback <15 years

Who Benefits from ESPC?

▪ Taxpayers

– Fewer capital demands, increased longevity of municipal

infrastructure

▪ Municipal leaders

– Can finance projects outside of capital budgets

▪ Facility managers

– Improved efficiency, fewer complaints, fewer emergencies

▪ Building occupants

– Healthier working/learning environments, increased comfort

How does the CT ESPC program work?

▪ Pre-qualified vendors

(QESPs = “ESCOs”)

▪ Pre-approved, standardized documents and process – Required for use by state agencies,

including public colleges/universities

– Available for use by municipalities

▪ Technical Support

Pre-Qualified Vendors

▪ 13 Qualified Energy Services

Providers (QESPs) are pre-qualified

and on State contract

http://www.ameresco.com/

http://www.conedisonsolutions.com/

http://honeywell.com/

http://www.johnsoncontrols.com/content/us/en.html

Support Services “Translate” ESPC Lingo

DEEP CEFIA

Utilities

TSP

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&docid=p9DpS3v5NdABsM&tbnid=0UGqxPE4JTGujM:&ved=0CAUQjRw&url=http://www.rewallmaterials.com/blog1/index.php&ei=eZrqUpp54uWwBILOgqgD&psig=AFQjCNGAMI3ApEM-lTLLncg9ebTe8zSbIw&ust=1391193049308681

Support Services – Energy Engineering

▪ Program Manager at DEEP

with energy efficiency

expertise

▪ Utilities – Incentives through

CT Energy Efficiency Fund

▪ 3rd party Technical Support

Providers (TSP = “Owner’s

Rep”)

Support Services - Financing

▪ CEFIA staff can provide advice and support

on financing options, introductions to

capital providers and financial institutions

▪ Tax-exempt municipal lease/loan guidance

documents

Typical Financing Methods

▪ State Agency projects will work with

CEFIA/OPM to determine if bonds or

private capital will be used for financing

▪ Municipal Bonds or Tax Exempt Lease

Purchase (TELP) are most common

financing mechanisms for municipal

building or K-12 School projects

Basic Financing Concept:

Qualified Energy

Services Provider

Municipality, Agency, or Institution

Financial Institution

Project Payment

Capital $

Finance Payments

Energy Savings

Energy Services Agreement

Loan, Lease, or Bond

Agreement

Municipality, Agency, or Institution

Qualified Energy

Services Provider

Financial Institution

Energy Savings >Finance Payments

Energy Savings

Finance Payments

How do I proceed?

Step 1: Select Qualified Energy Services Provider (QESP)

Step 2: QESP’s Investment Grade Energy Audit (IGEA)

Step 3: Arrange Financing

Step 4: Finalize ESPC Contract…Construct

Goal: Streamlined, efficient process

Lender

1a. Reach out to DEEP/CEFIA

1b. Prepare Technical Facility Profile

1d. Issue RFP for Feasibility Studies

1e. Select QESP

1f. Contract QESP for IGEA

1c. Issue Letter of Interest

First Projects under CT ESPC Program

Connecticut Valley Hospital – IGEA phase Dept of Corrections –

IGEA phase

Dept of Motor Vehicles - IGEA phase

City of Bristol – Selected QESP, beginning

IGEA

Town of Enfield – Selected QESP, beginning

IGEA UConn: Storrs & Health Center

– Selecting QESPs

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=5pXikQviNMw6KM&tbnid=NBkG78XFpSdTFM:&ved=0CAUQjRw&url=http://century21classichomes.com/bristolct.html&ei=opdFUqjfF4_I4APjmoAg&bvm=bv.53217764,d.dmg&psig=AFQjCNGZnxw96Qw_oTn-xKcpkx1-sdLKTA&ust=1380378898502820

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=tr75Y8ZHGCCQuM&tbnid=TQSpDFX4AHCwgM:&ved=0CAUQjRw&url=http://www.ct.gov/dmhas/cwp/view.asp?q=416778&ei=RIFuUoeNCpTD4AOqkYCgBw&psig=AFQjCNGuAl-_6fQyjqatIjAludUL8DtHWg&ust=1383060153381046

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=bjXoveXIFvZ0tM&tbnid=g--v4ikpGScdAM:&ved=0CAUQjRw&url=http://www.ct.gov/dmv/cwp/view.asp?a=808&q=244616&ei=2oFuUvGVJY6i4AOVx4HQDQ&psig=AFQjCNFY7CdYwcRb2SUKdFIJxukt7VxsTA&ust=1383060296869912

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=kHpaurqynU7sPM&tbnid=Fcrfw-OZ5TvNqM:&ved=0CAUQjRw&url=http://www.enfield-ct.gov/&ei=VWPaU-7ANqfV0QXJs4HwCA&bvm=bv.72185853,d.cWc&psig=AFQjCNENsM8lC13cFiLVJ9DMwwL7kuWq2Q&ust=1406907592991405

http://today.uconn.edu/wp-content/uploads/2013/12/Aerial131009a075.jpg

http://en.wikipedia.org/wiki/File:UConn_Health_Center.jpg

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=jcTKBt3UDT6WKM&tbnid=zU66Ow5kOy1DPM:&ved=0CAcQjRw&url=http://courantblogs.com/capitol-watch/malloy-signs-off-on-uconn-next-generation/uconn-logo/&ei=mtYaVKruA8OVyAShioCwAg&psig=AFQjCNEN65ktpWrRTP1aQvgpaJC-kgqypQ&ust=1411131413234089

http://courantblogs.com/capitol-watch/malloy-signs-off-on-uconn-next-generation/uconn-sign/

www.ct.gov/deep/leadbyexample Matthew Cohen, DEEP [email protected] 860-424-3077 Andrew Brydges, CEFIA [email protected] 860-258-7834

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