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HomeMy WebLinkAbout028214 ORD - 06/23/2009RESOLUTION ADOPTING THE CITY OF CORPUS CHRISTI'S ENERGY MANAGEMENT PROGRAM TO REDUCE ENERGY AND FUEL CONSUMPTION, INCREASE ENERGY EFFICIENCY, DEVELOP RENEWABLE ENERGY INITIATIVES, AND IMPLEMENT A GREEN CITY PROGRAM. WHEREAS, House Bill 3693 and Senate Bill 12 were passed and signed into law during the 80th Texas Legislative Session in 2007 establishing electric energy conservation policy for our state; WHEREAS, Senate Bill 12 impacts all political subdivisions located in nonattainment and near non -attainment areas or affected counties, which includes Nueces County and thus the City of Corpus Christi; and WHEREAS, Senate Bill 12 requires these political subdivisions to establish goals to reduce their electric consumption by 5% each year for the next six years beginning September 1, 2007; WHEREAS, the City of Corpus Christi recognizes the value of implementing renewable energy strategies for municipal facilities and encouraging our citizens to invest in renewable energy systems; WHEREAS, management of our vehicle fleet and associated fuel consumption is a critical component of our overall energy management program; WHEREAS, implementation of an effective recycling program and "green city" initiative will benefit our citizens and landfill resources in the long term; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. The City Council adopts the City of Corpus Christi Energy Management Program which is attached to and incorporated into this resolution. SECTION 2. The Energy Management Program remains in effect until amended by the City Council. SECTION 3. The City Manager is directed to distribute this Energy Management Program to the State Office of Energy Conservation in compliance with State law. Armando Chapa City Secretary APPROVED: June 15, 2009. Lisa Aguilar, Pissistant City Attorney For City Attorney THE CITY OF CORPUS CHRISTI Joe Ame Mayor 028214 1 Corpus C¢risti, Texas A3 of 2009 The above resolution was passed by the following vote: Joe Adame Chris Adler Brent Chesney 7111 Larry Elizondo Kevin Keishnick Priscilla Leal John Marez Nelda Martinez Mark Scott 028214 2 CITY OF CORPUS CHRISTI City of Corpus Christi Energy Management Program Approved: June 2009 3 Introduction At the State and Federal levels, energy consumption and conservation, renewable energy development, climate change, and fuel diversification has been central to public policy debates in almost every facet of American life. In the State of Texas, studies suggest our population will double by the year 2050. Policymakers in Texas have begun the process of planning for the future energy needs of our state and have focused significant attention not only on increasing generation capacity and expand renewable energy goals, but they have also placed an emphasis on energy conservation as a means to curb the need for additional generation. During the 8011' Legislative Session of Texas in 2007, lawmakers focused their efforts on two bills addressing the issue of energy conservation. House Bill 3693 set a statewide goal for energy conservation, requiring regulated utilities, such as our own transmission and distribution utility AEP, to offer energy efficiency programs which encourage energy conservation. In addition, Senate Bill 12 requires political subdivisions that are located in nonattainment or near nonattainment areas, which includes Nueces County, to establish goals to reduce electric consumption by 5% each year over the next six years, beginning September 1, 2007. Therefore, this provision applies to the City of Corpus Christi. While this new requirement was passed as a goal, rather than a mandate, any efforts to achieve results will no doubt require staff and departmental resources, and potentially a significant financial investment by the City in equipment, systems, additional staff, and infrastructure. Currently, the City of Corpus Christi has no comprehensive program to manage their energy consumption. Efforts in the past have focused departmentally on consideration of energy efficiency equipment in the engineering process, such as LED -based traffic signalization, replacement of existing equipment, such as air-conditioning, renovation of existing buildings, and other efforts on a project specific basis. With over 800 electric accounts, annual electricity costs to provide the public with essential services and meet our constituent's needs in Corpus Christi cost the City approximately $15 million or roughly 2.5% of our overall budget. In addition, hybrid vehicles have been considered in the past, but no comprehensive effort to systematically lower fuel consumption has been put into practice. Committing resources to a process that will give our departments the tools to better manage their energy and fuel requirements has the potential to increase our overall operational efficiency, establish accountability, and hopefully achieve significant savings, which if achieved as directed, represents a potential multi-million overall savings to the City. Finally, this conservation program also has the potential to lower the city's carbon footprint in an era of increased focus towards sustainability and increased public attention on global climate change. This program seeks to move our community towards implementation of green building principles, and ultimately protect the city from the volatility of the energy markets in this country. While policymakers have now forced the issue on us, instituting a comprehensive energy management program that also includes a renewable energy development component within the City of Corpus Christi makes operational and financial sense and is the right thing to do for our community and environment. Our program includes the following five key components: ➢ Energy Efficiency Goals for City -Owned Facilities > Renewable Energy Applications and Development > Fuel Consumption & Savings > Investment in Hybrid Vehicles > A "Green City" Program 4 Energy Efficiency Program Program Goals The City of Corpus Christi will seek to fully comply with the goals established by the Texas Legislature as contemplated in Senate Bill 12 during the 80Legislative Session. Our guiding principal and overall goal will be a 5% reduction in energy consumption (kilowatt-hours) on an annual basis over the next six years, beginning in FY 2009. While meeting this goal will be challenging for a municipality of our size that consumes approximately 150 million kwhs on an annual basis, we will seek to make strategic decisions to invest in conservation programs that provide opportunities for a sustainable reduction in overall consumption in a cost effective manner. In addition, part of our overall energy conservation program will incorporate strategies for our industrial facilities to correct for any assessments by our local transmission and distribution utility, AEP, for inefficient use of the electric grid (known as a power factor adjustment provision in the AEP Tariff). Departmental Responsibilities Each major city user will be responsible for development and implementation of departmental strategies towards achievement of the overall city goals for energy conservation. Resources will be allocated for this purpose on a departmental basis and energy conservation initiatives will be included as specific budget items by their department on an annual basis while this program is in effect. Major city user groups in order of largest to smallest users include the following: > Water > Wastewater > Engineering (Traffic Signalization, Street Lighting) > General Services (City Hall, American Bank Center, etc.) > Airport > Parks & Recreation > Police > Fire > Gas > Solid Waste > Storm Water Note: Any accounts that do not fall under the primary user groups above will be the responsibility of General Services Department. Department responsibilities will include: > Designating a management -level staff member for energy management responsibilities > Auditing of departmental electric accounts on an ongoing basis > Consulting with designated energy consultant on departmental facilities and their usage (HVAC, Lighting, Industrial Loads, etc.) > Identifying strategies and projects to meet overall energy management goals, including a financial cost -benefit analysis of each project 5 > Monitoring results > Coordination of departmental program with overall city program Electric Account Auditing The auditing of electric accounts by each department is the first step in the successful implementation of an energy management program. Information must be gathered which includes an accurate description of the load being served under each specific meter, monitoring of usage trends on a 12 -month basis to determine any irregularities in consumption patterns which could alert the city to an equipment problem, and ensuring each account is associated with the correct department. These examples of auditing guidelines will help ensure attention is being given to ownership of each of the city's approximately 800 electric accounts. Staff Orientation for Electric Account Billing Systems and Reporting On an annual basis, training will be provided to city departments and their designated energy manager to ensure their familiarity with the billing systems, how to read their electric bills, delivery service charges by AEP and how to run reports as necessary to fulfill these requirements. These opportunities will be coordinated with the City's current Retail Electric Provider, representatives from AEP, and other resources as needed. Energy Consultant & Available Resources Currently, the city has entered into a Memorandum of Understanding with AEP -Texas Central Company to participate in their CitySmart Program. CLEAResult Consulting is the AEP partner in providing technical assistance to the city as it pertains to best practices in the areas of energy usage and energy efficiency. The city has engaged CLEAResult to provide technical assistance as our program is formulated and implemented and will continue utilizing this program. We are also in discussions with the State Energy Conservation Office to provide energy audits through their "Preliminary Energy Assessment" service for a targeted number of our buildings. In addition, City staff is recommending hiring an energy consultant to provide additional expertise in identifying areas of opportunity for energy savings with the contract being driven by savings performance and overall results. An alternative to the hiring of a consultant would be to create an Energy Manager staff position to oversee and ultimately drive the City's program. >Engineering Processes One of the most critical aspects of a successful energy management program is the institutionalization of energy conservation and energy management philosophies into the overall engineering processes at the city. Energy management, if implemented correctly, will require a financial commitment that is ultimately paid out over time through avoided costs, efficiencies gained, administrative simplicity, and standardization. Implementing our strategy at the engineering level will ensure a consistent application of technology across city facilities. Engineering Process Strategies Could Include: o Investment in a comprehensive Energy Management System o Standardization of Equipment (i.e. Utilizing Standard HVAC Equipment for Repair Simplicity and Energy Management System Compatibility) o Routine Weatherization Programs (i.e. Checking Old Buildings for Air Leakage and 6 Insulation Needs) o Lighting System Retrofitting (i.e. Upgrading Ballast Equipment, Bulbs, Installing Motion Sensors) o Installation of capacitor banks on industrial loads to eliminate or mitigate power factor charges applied by AEP per tariff requirement. Metrics to Determine Results Metrics will need to be developed as potential Balanced Scorecard entries to measure investment and ultimately our return on investment in energy management initiatives. Each department will be required as part of their energy management programs to develop goals and metrics for their program. Ultimately, our goal as a city is to do everything possible to meet the 5% annual reduction in energy consumption over the next six years as required by the State. Our program is successful if we reduce consumption which translates into real savings and ultimately allows us to better manage our costs. In the event carbon legislation is passed at the federal level, management of our overall carbon footprint could also be a metric that we follow as public policy dictates. Renewable Energy Development As a component of our overall energy management program we believe sustainability and renewable energy must also be a consideration to explore. We will seek to invest in alternative generation technologies such as wind generation, solar and battery technologies, and bio -fuel applications from our landfills and wastewater treatment facilities to offset our consumption off grid or create potential revenue streams through energy sales, where financially feasible. The goal is to determine any opportunities for revenue or cost reductions through land leases, opportunities to develop wind generation sources, opportunities to utilize landfill gas to produce electric energy, and smaller strategic applications for wind and solar technology. Renewable projects of this nature, because they are encouraged by the federal government, also bring the potential for renewable energy credits which are a valuable commodity in today's financial markets. In addition, we could also consider the development of an educational driven renewable energy technologies park in the coastal bend area as part of our overall strategy to market the uses of these renewable energy opportunities and educate our youth in the process. It is critical to choose the right partner in pursuing these types of renewable energy goals. Two projects currently under review are as follows: Wind Energy at Cefe Valenzuela Landfill: Based on a site survey conducted in September 2008, the approximately 2000 acres of available land at the Cefe landfill, in conjunction with an abundance of open range in the surrounding area, presents a unique opportunity for a wind farm development. In addition, access to nearby electric transmission facilities make our location a prime spot for wind turbine placement. As part of our overall energy sourcing strategy, renewable energy could be a critical component of serving our energy needs at the city. It is possible that up to 15 wind turbines rated at up to 2.5 MW per turbine could be placed on Cefe land not currently being utilized for solid waste disposal. A formal study would need to be conducted and consideration given to permitting requirements by the TCEQ in placement of wind turbines at an active landfill, which could present a challenge for this project. The revenue potential would include the leasing of surface land rights for placement of the wind turbines as well as an equity 7 position in the wind farm investment and potential future energy sales. In addition, the city could contract to purchase the power generated from these sources in the future. We will explore this opportunity through an RFP process to determine a potential partner. Landfill Gas at Elliott Landfill: Efforts have been made by city staff in the past to consider potential uses for the methane gas production of the Elliott Landfill. While those past efforts have met limited success, we are reassessing this as a potential renewable energy project in the future. As a result of the closure of Elliott, the timing is good to consider gathering substantial amounts of the methane gas produced and placing gas turbines in a strategic location to supply power to the nearby Greenwood Wastewater Treatment Plant. A potential development project involves either piping the methane gas from Elliott to Greenwood, and placing the gas turbines on-site at the Greenwood Plant to offset some of the current electric consumption, which would represent an avoided cost by the city in the future, or we could site a turbine at Elliott and place the power back onto the grid at a market-based price determined by ERCOT. Permitting requirements will also come into play under this scenario through the TCEQ. In either scenario, a partner would also be determined through an RFP process. Other Applications: We will also continue to look for opportunities to install smaller renewable applications where energy can be provided for smaller loads, such as school signals, small pumps, or applications that are difficult or costly to extend traditional power lines to serve. Solar technologies and smaller wind turbines are examples of renewable applications of this nature. Fuel Consumption & Savings Annually, the City of Corpus Christi spends approximately $7 million on fuel related expenses for city -owned vehicles and city employees travel approximately 24 million miles in carrying out their duties. Reducing fuel consumption in a meaningful manner will require a departmental based review of existing practices to find and achieve savings. Staff believes achieving a meaningful reduction in fuel consumption will involve every department and requires setting an aggressive goal of a 5% annual reduction. This would result in approximately $350,000 of savings a year. Strategies to reduce behavioral usage include: D Better Scheduling and Organization of Daily Activities D More Efficient Routing of Daily Trips and Patrols D Reducing Idling of Vehicles D Policy Review of City Vehicle Use for Personal Purposes D Alternative Fuels (Compressed Natural Gas "CNG") and Hybrid Vehicles D Investment in Fuel Management and Tracking Systems Investment in City Hybrid Vehicles The City fleet is comprised of approximately 2000 vehicles. On average, the City is replacing 100 to 150 vehicles per year. In addition, the City's fleet includes approximately 50 CNG fueled vehicles and one lone hybrid vehicle. The benefits of investment in CNG vehicles is the savings associated with the fuel. CNG is less costly than petroleum gas. Hybrid vehicles on the other hand get better mileage than traditional vehicles. In both cases, these vehicles are five to ten thousand dollars more expensive depending upon the model. Committing to investment in hybrid vehicles will involve a financial commitment on the part of the City to 8 achieve sustainable fuel efficiencies. Hybrid vehicles also offer environmental benefits in terms of vehicle emissions that must be taken into consideration. If 5% of the vehicles we replace annually are replaced with hybrids of some type, we would commit to purchasing no more than 10 hybrids a year, at a somewhat increased cost, but providing for a sustainable reduction in fuel consumption. A "Green City" Program Establishment of Energy Conservation Marketing Program & Website As many of other municipalities in the State of Texas (most notable the City of Houston, http://www.houstonpowertopeople.com/) have accomplished, sharing information with the public on energy management goals is an important component of an overall energy management strategy. In addition, marketing programs that provide information to city employees and citizens regarding energy savings tips and entering into strategic partnership to provide information to the public are a critical component of our program. To this end, we are considering joining a coalition of organizations through the "TexaslsHot" coalition to gain access to valuable and up to date energy efficiency information of this nature. The intent on establishing a formal website on the City of Corpus Christi website dedicated to energy management programs would not only serve to highlight action the City is taking to conserve energy, but it would also serve to provide tips to our citizens on how they might save money at home or at their business as well. An educational tool of this nature would serve as an additional means to informing the public regarding any programs at the local, state, or federal level involving green buildings, sustainability programs, energy conservation, sources of funding, and other valuable energy related programs available. We would also use Public Service Announcements through CC TV to highlight our efforts and encourage citizen action as well. Development Services Efforts It is important to note that Development Services is on a parallel track to review and implement building standards to allow the citizens of our community to install residential and commercial renewable applications as well. Our building officials will be working to ensure that the city does their part to encourage safe standards consistent with other municipalities and national building codes. We want our citizens to do their part as well for our environment and educating the public on building requirements will be a key first step in the process. Recycling Program We also hope to reignite efforts at a more effective recycling program city-wide. While we have seen limited success over the years, we have to make it easier for our citizens to recycle, which is a critical component of being considered a "green city". We hope to re-evaluate our recycling efforts and bring this in to the bigger effort of overall conservation and management of our local resources. Other Considerations Grant Applications & Other Programs The City of Corpus Christi intends to pursue state and federal funds available through grant 9 programs, federal stimulus dollars, and other financial incentives offered and administered through the State Energy Conservation Office of the State of Texas, AEP, and through the U.S. Department of Energy, where available. Leveraging local dollars against federal and state matching funds will allow the city to maximize the resources committed to this effort to upgrade infrastructure and systems, explore renewable energy technologies, lower fuel consumption, and other energy management opportunities that have been identified and championed by public policy makers at the state and federal levels. Impediments to Success In closing, as stated in the introduction, the proposed energy management program is a comprehensive approach to implementing a sustainable reduction in energy and fuel consumption at the City of Corpus Christi in addition to looking at projects that will potentially reduce costs or provide new revenue streams through renewable technologies. It will require a serious commitment of resources, a thorough review of existing processes and policies, and incentives for departments to act to change existing behaviors. Having a plan in place is the first step to institutionalizing a program, but without commitment from our local policymakers, support from the community, and financial resources to make it happen, this plan will ultimately be unachievable. 10