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<br /> The recommended scope of work includes the following improvements:
<br /> • The upgrade of all applicable fluorescent lamps including installation of electronic ballasts.
<br /> • Installation of Premium Efficiency Motors and Variable Frequency Drives at the Library in the
<br /> heating, ventilation and air conditioning (HVAC) system improving the reliability of the system.
<br /> The existing motors were to be replaced within the next few years, so taking advantage of the
<br /> incentive program replacing the units now is timely.
<br /> • Upgrade of pool equipment and pool covers at both Hoover and Herkner Pool facilities.
<br /> .• Installation of Solar Window Screening at MSC Administration Building, and
<br /> • Conversion of 56 traffic signals from green incandescent lamps to green LED.
<br /> . After reviewing all of the City's facilities, NORESCO recommended a multi-point program that will
<br /> provide the City with the following key benefits:
<br /> • According to NORESCO's engineering calculations the City should see a utility cost avoidance
<br /> of approximately $118,000 per year at present use and utility rates.
<br /> • The upgraded lighting system will standardize lighting fixtures, establishing a preventative
<br /> maintenance re-lamping program,
<br /> • improves lighting quality and lowers utility costs. This phase will affect over 6,SOO light fixtures
<br /> in our facilities.
<br /> . • Payoff Total Rebate Net
<br /> in Annual Ener Savin s Project Utility % of Project
<br /> Descri tion Years kWh Therms Dollars Price Rebate Pro'ect Cost
<br /> Li htin Retrofit 7.6 485,162 - $48,031 $390,203 $25,345 6.5% $364,858
<br /> Premium Motors & 10.5 47,280 - $4,667 $52,282 $3,460 6.6% $48,822
<br /> Drives
<br /> Herkner Pool 6.4 45,823 26,390 $19,355 $135,323 $10,800 8.0% $124,523
<br /> Hoover Pool 2.7 45,823 30,863 $22,053 $71,258 $12,000 16.8% $59,258
<br /> Municipal Service 12.5 4,150 $415 $5,458 $255 4.7% $5,203
<br /> Center
<br /> Green LED's 3.3 235,562 N/A $23,556 $174,128 $96,000 55.1% $78,128
<br /> TOTAL 5.77 863,800 57,253 $118,077 $828,652 $147,860 17.8% $680,792
<br /> The net cost of the project to the City is $ 680,792. NORESCO will be responsible for all project
<br /> coordination including application for and .receipt of P.G.& E. rebate incentives estimated to be
<br /> $147,860. Staff is requesting a$50,000 contingency allowance for unanticipated costs associated
<br /> with the project. Once complete, the City will realize an estimated $118,000 per year utility energy
<br /> savings resulting in a simple payback for this project of 5.77 years. Brian Ponty, Director of Finance
<br /> has calculated the project to have an Internal Rate of Return (IRR) of 15.08% over a 10-year period
<br /> based exclusively on the energy savings.
<br /> Given the magnitude of this project, the City could not complete the work to convert our facilities
<br /> in a timely manner without the assistance of a partner such as NORESCO. The project must be
<br /> complete and inspected before June l, 2001 in order to receive all anticipated incentives. These
<br /> programs do have limited funding that could be used up prior to the dates specified above, so there
<br /> is a need to move forward with the project.
<br /> Alternatives
<br /> The City could elect not to do all recommended changes and excluded the lighting retrofit, for
<br /> example. The project would be $438,449 less $122,515 in rebate incentives, for a net project cost
<br /> of $315,934. The return on investment would be better, but the overall utility savings would not be
<br /> as significant. Given the cunent energy climate, recognizing the short energy supply, future energy
<br />
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