ESCO defined

Lately, I've been mentioning ESCOs (energy services companies) a bit. I'm doing this because the Town could potentially be looking at investing in millions of dollars over the next few years... in an effort to conserve energy and money. Anyway, I came across this "definition" of an ESCO, as well as a definition of "performance contracting." I think it's a pretty good explanation, so I wanted to share it with you:

Energy service companies provide a various array of solutions for end-user needs. These services encompass everything from energy audits to lighting retrofits. Due to rising and volatile energy prices, a push on energy conservation has increased significantly. End-users are looking more and more to demand/response and meter reading to help analyze, predict, and control energy usage.

ESCO products and services typically include the following:

• Heating, ventilation and air-conditioning (HVAC) upgrades
• Lighting retrofits
• Uninterrupted power supplies (UPS) and power storage technologies
• Back-up power
• Upgrades on industrial equipment, including motors and controls
• Facility management
• Renewable technology application including wind, solar, fuel cells, and biomass waste to energy
• On-site heat and power (co-generation) systems; combined heat and power (CHP)
• Commodity procurement consulting
• Demand and load management

Energy service companies that have experienced levels of success often share this success due to their ability to effectively blend a wide range of solutions for their clients, often times with the capability to guarantee performance. ESCOs also often use performance contracting – a contract in which the energy service company bears the cost of implementation of all services and products and then recovers these costs along with profits from the savings spawned by the applicable services.

ESCO products and services continue to accommodate lighting and comfort needs for end-users but there is a definite shift of focus toward reducing energy consumption and lowering energy costs. Government mandates relative to conservation, record high fuel prices, and aging infrastructures have spurred growth throughout what was a relatively mature market.

Tim White
Town Council, Energy Commission liaison

ESCO solutions

For those of you who are wondering about some typical offerings of an ESCO through the use of a performance contract, here are some examples:If you read what I highlighted in blue, you'll see this particular ESCO offers "solutions" for both pools and sewer systems.

Anyone happen to know any towns around here that might be able to use some help with their pool or sewer system?

Tim White
Town Council, Energy Commission liaison

ESCOs in Cheshire

Cheshire-based Harkness Industries recently employed an ESCO (Energy Services Company) to help it save on energy costs. This is similar to what is being considered by the Energy and Public Building Commissions... they want to ask an outside consultant to provide ideas on how the town can save money. (see NHR, by Luther Turmelle)

The great thing with energy though is that it may be possible to avoid paying "out-of-pocket" for such a consultant. Instead, we may be able to cover the consultant fees with the money saved on the energy costs.

Tim White
Town Council, Energy Commission liaison

Performance contracting may get its day in court

A few days ago, the Council received the following email (unedited) from Councilman Matt Altieri:

Hello Fellow Council Members

I wanted to let all of you know that I have been doing some extensive research on how we can bring a possible ESCO to our town to do an energy review and possible performance based contract. I have spoken to municipal officials and someone who consults in the business as well as watched a Webinar that focused on how to use stimulus funds to leverage energy savings. Full disclosure here I did speak with Christopher F. Halpin, P.E., C.E.P who is President of Celtic energy. I watched his Webinar last week and then called him and spoke with him for about 30 minutes. I was able to obtain information about the process-not an easy one to put together but doable over a few months period of time. There are many issues that need to be resolved in terms of process and especially in the area of how the financing will be addressed in regard to our town charter. I did discuss this with the Town Manager and we did begin to list out the issues that may need to be resolved.

It would take too long to explain the process in one email but suffice it to say it has taken me many months of research and phone calls but I think I have a process in mind that I would like to discuss at the next council meeting and get some feedback from all of you as to how to proceed. It is a fairly complex process that will involve town hall staff, our town attorney as well as our Energy Commission. I have put a call in to Rich Orgurick to discuss at the next Energy Commission meeting but he has not yet returned my call. I am sure I will hear from him soon on this issue. When he does I think that commission may be a good starting point. I will let you know the rest of the details next week at the council meeting.

Best
Matt Altieri

I think this is great, if he is serious. Some may call me cynical, but this does give me pause... wondering if it's just election year gimmickry? After all, such attention was promised two years ago.

Regardless, I'm glad to have someone at least discussing PC as a possibility. And in defense of my Council colleague, as I've said before... he does work. I just hope that the voters see our Honorary Mayor wannabee, Councilman Truth, for the effort - or lack thereof - he puts into the job. Not that I want to be on the losing side of a vote, but I'm ok with it. What really troubles me is indifference.

Three months and counting....

Tim White

p.s. I'll probably do a timeline of the inaction on performance contracting later this week.

Altieri wants a discussion on performance contracting

Yesterday I got the following (unedited) email from Councilman Matt Altieri:

Hello Fellow Councilors

Yesterday Michael Milone, Rich Ogurick and I met to discuss the ESCO process. There was much progress made and it was an excellent meeting. There are still many issues that we need to research but the consensus was to bring in a consultant to present the process and have a discussion with commission members, council and public. Most likely in October as we need to schedule this. I would recommend Chris Halpin of Celtic Energy.

Is this ok with all? Wanted to make sure before going forward.

Matt Altieri

As I've mentioned before here, and explained in detail here... I do believe that Councilman Truth is the reason that there's been no serious discussion of PC. But I also believe that Councilman Altieri is quite sincere in doing this. So I thank Councilman Matt Altieri for his efforts.

Tim White

Energy Commission 2/26

The Energy Commission met tonight. As usual, there was lots of stuff on the agenda. Some items of interest...

1) the pool report - I was rather annoyed to learn that the pool consultant has not yet met with the energy commission, nor even scheduled a meeting... despite my repeated requests. And they're set to report within a week or two.

2) fuel cells - CT Clean Energy Fund is currently reviewing proposals... look for an announcement during April, either on grant recipients or just proposals that make it to the next round... not sure which.

3) CCM aggregation of town/school energy purchases - the desire is simply to ensure we, the taxpayers, get the most bang for our buck. So we want to make sure the schools and town coordinate on this. For background, this concern/idea probably came to light most recently as a result of the Town entering into a long-term electricity purchasing agreement with CCM. (So, in other words, we're buying our "generation" from CCM... while the "transmission" is still provided by CL&P.) However, the schools are not included in this agreement. So I think the EC wants to make to sure that "the right hand talks to the left hand."

4) Public library window replacement - these windows were getting replaced for a number of reasons. But the EC is going to try to calculate the estimated cost savings for the windows, in turn determining a payback period.

5) Energy Star / benchmarking portfolio manager - work in process, but we need this data to do various cost analyses on projects to determine their value and to prioritize the projects. I think the holdup on this project is "institutionalizing the program." Thing is, it was a volunteer EC member who did this up until he resigned and moved out of town in October. Now we're trying to get this done by town staff... shouldn't be real time consuming. Maybe an hour or two per month... just entering kWh/building to a website... but the data could be immensely helpful in prioritizing energy efficiency projects.

6) 20% by 2010 - Cheshire has 171 households signed up for clean energy. There was a discussion on how to spend a recently received $5,000 grant for promotion of clean energy... I think we should spend it all on newspaper advertising! haha... just checking to see if the newspapers are paying attention!

7) biodiesel in town trucks - we've been using B5 for about a month now and have had no problems. We're hoping to switch to B20 by springtime. I also mentioned my desire to get our school buses using biodiesel, but mentioned that I began that discussion about a year ago... and have made no progress. However, if you think biodiesel in our school buses is a good (or bad) idea, maybe you should contact the schools yourself. And here's one person you could contact: Greg at gflorio@cheshirect.org

8) An Inconvenient Truth - There was discussion about getting the EC to air this again. I mentioned that Diane Visconti and I had discussed doing just such a thing. So I think this may happen... and before anyone jumps all over me about this... the idea is for discussion purposes. I haven't seen the whole movie, nor analyzed much to do with it. But similar to our discussion here on the northend, I think a discussion can often elevate the dialogue... and that alone could make this worthwhile.

9) ESCOs for townwide energy project - ESCO = Energy Services Company... my hope is that the town issues an RFP for ESCOs to propose a townwide energy plan.

Tim White
Town Council, Energy Commission liaison

Altieri email requesting info on PC at pool - 2

A few hours later, I responded to Councilman Altieri. Here is the text of my response to his Sept 6 email:

"At this point I have some information that relates to the topic"

That's great to hear. But for information specifically related to performance contracting and pools, see here:

http://timwhitelistens.blogspot.com/2007/09/esco-solutions.html

And as I mentioned to you a few months ago, I'm confident you could google a few key words and find lots more information on pools and performance contracting.

Tim

I'll continue the email chain tomorrow... perhaps with images of the emails. But it's late tonight, so a cut'n'paste is all I'm doing.

Tim White