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HomeMy WebLinkAboutPW Retrofit Loan Program; PG&EAgenda Item No: 3 d Meeting Date: Nov 7, 2011 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: Public Works Prepared by: �� -- City Manager Approva Director of Public Works (LB) File No.: 18.01.74; 06.01.191 SUBJECT: RESOLUTION AUTHORIZING APPLICATION FOR THE ENERGY EFFICIENCY RETROFIT LOAN PROGRAM AND AUTHORIZING THE PUBLIC WORKS DIRECTOR TO SIGN A FINANCING SUPPLEMENT WITH PACIFIC GAS & ELECTRIC COMPANY (PG&E). RECOMMENDATION: Adopt resolution. BACKGROUND: Over the last few months the Department of Public Works, working closely with representatives from the Pacific Gas and Electric (PG&E) Company, has identified three specific projects that can save energy for the City over a period of time. The City of San Rafael currently maintains and operates over 4,400 high pressure sodium street lights and four parking garages within the downtown area which utilize varying types of safety lighting including metal halide, high pressure sodium, etc. Conversion of the safety and street lighting to Light Emitting Diode (LED) will greatly reduce the City's energy consumption. In addition, the City previously received a grant for the replacement of the existing Heating, Ventilation and Air Conditioning (HVAC) unit in City Hall which, when replaced with a new updated model, will reduce energy usage at this facility. The HVAC equipment has been purchased and the installation cost exceeded the project budget when recently bid. The City projects noted above qualify for the Energy Efficiency Retrofit Loan Program funded by California utility customers and administered by PG&E. The Program provides PG&E customers with a means to finance energy-efficient retrofit projects. The loans issued under this Program are interest-free, in order to reimburse PG&E customers for the costs they incur in connection with a qualified retrofit project. Loans are generally paid back over a ten year period from energy savings, and are calculated by dividing the loan amount by the estimated monthly energy savings resulting from the project. Combining the garage safety lighting replacement with the City Hall HVAC project would provide the necessary energy costs savings in order to fund the installation of the LED garage lighting and cover the FOR CITY CLERK ONLY File No.: Z4 — Council Meeting: I t 11 Disposition:°" . SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 remaining construction costs for the HVAC installation. The street light retrofit project qualifies for funding as a separate project. Each of these proposed projects are in accordance with the City's Climate Action Change Plan of which Building Program 5 proposes to achieve energy savings in existing buildings and facilities. If approved, the total of both retrofit projects (street lighting, garage safety lighting & City Hall HVAC) will save the City approximately 350,000 kWh each year for a total annual cost savings of approximately $54,000. This will allow for a maximum loan amount of approximately $540,000 to be paid back over a 10 year period. After 10 years, the annual energy cost to the City will be reduced by the $54,000. The attached Resolution authorizes the Public Works Director to apply for a loan from PG&E for the projects mentioned. ANALYSIS: Submittal of the Loan Supplement Application will allow PG&E to proceed with the process of allowing the City to secure an Energy Efficiency Retrofit Loan. FISCAL IMPACT: No money from the City is required for this loan. If approved, the City will be reimbursed for all construction costs associated with the retrofit projects up to the maximum loan amount per project. The City will repay the loan using energy cost savings over 10 years with no fees and zero percent interest. If approved the City shall secure the loan amount prior to starting any construction for these projects. ACTION REQUIRED: Adopt Resolution Enclosures (2) 1. Resolution 2. Financing Supplement to the Energy Efficiency Retrofit Program Application RESOLUTION NO. 13256 RESOLUTION AUTHORIZING APPLICATION FOR THE ENERGY EFFICIENCY RETROFIT LOAN PROGRAM AND AUTHORIZING THE PUBLIC WORKS DIRECTOR TO SIGN A FINANCING SUPPLEMENT WITH PACIFIC GAS & ELECTRIC COMPANY (PG&E). WHEREAS, the City of San Rafael maintains and operates over 4,400 high pressure sodium street lights; and WHEREAS, the City of San Rafael maintains four parking garages with safety lighting; and WHEREAS, the City of San Rafael City Hall Building utilizes a Heating, Ventilation and Air Conditioning unit; and WHEREAS, replacement of the street and safety lights with LED fixtures will reduce energy and save on utility costs; and WHEREAS, installing a HVAC chiller unit in City Hall will reduce energy and save on utility costs; and WHEREAS, Energy Efficiency Retrofit Loan Program is funded by California utility customers and administered by Pacific Gas and Electric Company (PG&E); and WHEREAS, the loans issued under the Program are interest-free, unsecured loans to reimburse PG&E customers for the costs they incur in connection with a qualified retrofit project; and WHEREAS, in order to receive assistance, the City must sign a Financing Supplement Application with Pacific Gas & Electric (PG&E). NOW, THEREFORE, IT IS HEREBY ORDERED AND RESOLVED that the Director of Public Works is authorized to apply for such loan and sign the Financing Supplement to the Energy Efficiency Retrofit Program Application. IT IS FURTHER RESOLVED that the Director of Public Works is hereby authorized to take any and all such actions and make changes as may be necessary to accomplish the purpose of this resolution. 1, ESTHER C. BEIRNE, City Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the Council of said City held on the 7`h day of November, 2011, by the following vote, to wit: AYES: COUNCIL MEMBERS: Brockbank, Connolly, Heller, Levine & Mayor Boro NOES: COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS: None ESTHER C. BEIRINE, City Clerk File No.: 18.01.74; 06.01.191 The Energy Efficiency Retrofit Loan Program (the 'Frogram1isfunded byCalifornia utility customers and administered byPacific Gas and Electric Company WOW under the auspices ofthe California Public Utilities Commission (CPUC|.The Program provides qualified PG&E customers with ameans mfinance energy-efficient H)retrofit projects implemented under select PG&E EEPrograms [the "Qualified Pmgram^LThe loans issued under the Program are intne$-fpee. unsecured loans tnfully orpartially reimburse qualified PG&E customers for the costs they incur inconnection with aqualified retrofit project (the "Retrofit Pnojeci^).which term shall mean the energy efficiency retrofit project described inCustomer's relevant Energy Efficiency Program Application. ` Conditions for EUg|b|i��Participation inthe Program islimited tn PG&E customers that meet the following conditions and satisfy these condihonsthroughout the duration cfthe Retrofit Project opW and including the date dFinal Verification (defined below mSection 8i(a}the PG&E customer must beabusiness ('Commerciai Cugnmer")nrafederal, state, county orlocal government agency ('GmemmentCugomor"[`Commercial Customers and Government Customers are collectively referred has^Customer;' <b)Custnmercurren/lyne:c|vcssvrvicefromPS&Eat|hclocahonof the Retrofit Project (the 'Lorationl;(c)Customer has continually maintained anactive PG&E account for the previous 24months and has aminimumdl2months ofhistorical metered energy usage at Customer's current Location; W|at the time the Customer's Program Application isApproved and Customer's Loan Agreement is executed, and atthe time the can istobefunded following completion ofthe Retrofit Project and satisfaction ofall other requirements ofthe Loan Agreement, Customer must bningood credit standing, cadetermined byPG&E through credit review which may include acommercial credit check and abill history review, which may bebased upon the following and other criteria: m.No24'hourdisconnection notices inthe last l2months; b.Nareturned payments within the last l2months; c.Nnmore than 1 payment arrangement inthe last 12months, d.Nobroken payment arrangements within the last l2months; e.Nodeposit assessed within the '�astl2months; and t The Retrofit Project qua0icsand Customer is eligible for anincentive under the QuaUfiedProgram. Loan Features: The loans offered under the Program are interest- free 0%|andfmnofonyfees.labpaymentpenaWcsorother charges. The loan terms and conditions are set toprovide simple payback from energy savings during the maximum allowed loan term, and are calculated bydividing the loan amount (eligible project cost less Qualified Program Incentives) bythe estimated monthly energy savings resulting from the Retrofit Project. The ensuing number ofmonthly payments must not exceed the Maximum Loan Term set forth inchart below ("LoanAmount and Term Limitahons^). EUg|b|Uty'Prior topurchasing and installing any energy-efficient measures nrequipment under the QuaiifirdProgram, Customer must satisfy the eligibility requirements ofboth the Program and Qualified Program. Because energy efficiency projects inpmgmss are ineligible under the Program, Customer must have aninspection ofthe Retrofit Project and Location conducted and completed by PG&E before commencing any work orpurchasing any equipment for the Retrofit Project. |nmpectiun'PG&E wilt assist Customers inunderstanding the energy efficiency measures available under the Qualified Program and will answer their questions concerning this Program. After Customer has decided upon the measures that comprise the Retrofit Project, PG&E wilt request anengineering review, perform aninspection vf the Location, calculate the Loan Terms and prepare the Loan Documents. Thereafter, PG&E will provide Customer with acopy of the inspection report, aLoan Agreement, thcAppUcadnn.the applicable On'BKiFinancing (0BHGas and/or Electric Rate Schedule �Calculation [collectively, ' Loan Dncumentsl. Loan Documents' If the terms nfthe loan are acceptable, Customer shall execute the Leon Documents and return them tnPG&E prior m the commencement of the Retrofit Project. Incomplete orincorrect applications cannot beprocessed and may rcsu�inthe delay nf PG&E'sapprmvaiand possible disqualification from the Program. Customer maywithdrawthis Application for any reason without penalty bysmdingwritten notice toPG&E Customer's Responsibilities for Contractor andVendor'Upon PS&E'snotification toCustomer that the Retrofit Project iseligible for the Program, Customer may begin the Retrofit Project pursuant bzthe contract a8nyeduponbyCustomer, itscontractor nr`endoc PG&E does not endorse orrecommend any particular cont -actor pr vendor nordoes PG&E review any contractor orvendor proposals. Rather, Customer shaUbesoLelynasponsible for reviewing the easib|Uty ofthe contractor's and vendor's pmpoyaUdand verifying ,heir respective qualifications, pricing, energy savings.wermnhes and the terms and conditions of the mntroctor'sand/or vendor's contractwithCustnmer °Resiuenualcustomers are inemg.Nc. Page 1of2 PF Disclailer: CUSTOMER'S DESIGN OF THE RETROFIT PROJECT AND SELECTION AND USE OF ENERGY EFFICIENCY EQUIPMENT, MEASURES AND SELECTION OF CONTRACTORS AND VENDORS IS AT CUSTOMER'S SOLE DISCRETION AND AT CUSTOMER'S SOLE RISK. TO THE EXTENT PERMITTED BY APPLICABLE LAW, PG&E EXPRESSLYAND SPECIFICALLY DISCLAIMS ANY LIABILITY IN RESPECT OF ANY ADVICE, INFORMATION OR OTHER INSTRUCTION PROVIDED BY OR ON BEHALF OF PG&E TO CUSTOMER IN CONNECTION WITH THE QUALIFIED PROGRAM, PROGRAM OR RETROFIT PROJECT. PG&E DOES NOT WARRANT OR BEAR ANY RESPONSIBILITY FOR ANY OF THE FOLLOWING: a, THE WORK PERFORMED BY CUSTOMER'S CONTRACTOR(S) OR VENDOR(S), THAT THE RETROFIT PROJECT IS APPROPRIATE FOR THE LOCATION; b_ THE RETROFIT WILL RESULT IN OR YIELD ANY ENERGY EFFICIENCY SAVINGS OR A SPECIFIC AMOUNT OF ENERGY EFFICIENCY SAVINGS OR OTHER REDUCTION IN CUSTOMER'S PG&E UTILITY BILL AFTER COMPLETION OF THE RETROFIT PROJECT; c.THE CONTRACTOR'S OR VENDOR'S SERVICES WILL BE TIMELY, COMPLETE OR ERROR -FREE, OR THAT DEFECTS IN THE RETROFIT PROJECT WILL BE CORRECTED BY SUCH INDIVIDUALS; da ANY ERRORS, OMISSIONS, DEFECTS OR DELAYS IN THE DESIGN OR CONSTRUCTION OF THE RETROFIT PROJECT OR THE OPERATION OF ANY ENERGY EFFICIENCY MEASURES INSTALLED AT THE LOCATION, Verification: Upon completion of the Retrofit Project, Customer shall request PG&E's post -completion inspection and final verification that the Retrofit Project has been completed in conformity with the requirements of the Qualified Program and that customer remains eligible (the "Fina[ Verification"). x If there has been any change to the Retrofit Project's scope, cost and/or incentives available under the Qualified Program or energy savings, Customer will be required to enter into a Loan Modification Agreement with PG&E, which may include new contract terms reflecting the changes in the Retrofit Project. Of a Loan Modification Agreement is required, it shall be deemed part of the "Loan Documents." b, If the changes to the Retrofit Project are such that it no longer meets the Program's payback criteria or other conditions, the Retrofit Project will be considered ineligible, the Loan Agreement wilt be terminated and no loan proceeds wilt be disbursed. c. IF PG&E DETERMINES, IN ITS ABSOLUTE DISCRETION, THAT CUSTOMER'S CREDIT HAS DETERIORATED OR HAS OTHERWISE PLACED CUSTOMER'S REPAYMENT OF THE LOAN AT RISK, THE LOAN PROCEEDS SHALL NOT BE ISSUED, EVEN THOUGH THE RETROFIT PROJECT MAY HAVE BEEN SATISFACTORILY COMPLETED AT CUSTOMER'S EXPENSE. Disbursements! Subject to and following PG&E's satisfactory Final Verification, an incentive check and the loan proceeds wilt be issued to Customer or, at Customer's written direction, to Customer's contractor or vendor. General Provisions-, . Applications for loans under the Program wilt be accepted from qualified Customers on a first-come, first-served basis until the funds allocated by PG&E for the Program are no longer available. The Program may be modified or terminated by the CPUC or PG&E at any time and without prior notice. However, termination of the Program following execution of a Loan Agreement by Customer wit[ not affect that Loan Agreement, or, if Customer thereafter satisfies all Program conditions, the disbursement. b, The loan proceeds may only be used to pay or reimburse Customer for implementing or installing energy-efficient measures or equipment through the Qualified Program. co If there is any conflict between the terms of any document relating to the Program, the Loan Documents shall control. ds For all retrofit projects, including but not limited to streetlight, HVAC and lighting retrofits, Customer acknowledges and understands that Customer is able to use the installation vendor or contractor of their choice. have read, understand and agree to all of the Energy Efficiency Retrofit Loan Program requirements and terms and conditions set forth in this Program description. I understand that loan calculations will be based on pre -inspection results and on the applicable program documentation, and that my agency/company must meet all eligibility criteria and requirements in order to participate in the Program. Any unapproved changes to project scope, costs or run hours, or to my agency's/company's creditworthiness, between the time the Loan Documents are accepted and signed and the Retrofit Project is completed and the project's and my agency's/company's continued eligibility are verified, could result in loan ineligibility. Legal Name of Business ti.e., the formal name on your tax return) Authorized Representative's Printed Name Authorized Representative's Signature Title Date Tax identification information (select one): ❑ Federal Tax 10 Number: Ella Social Security Number: FOR PG&E USE ONLY: PG&E OSP Administrator Printed Name Cate Retrofit Program Application Number oBF Application Number 'oG&Erefers to PaO:c Gas and Eiectre company, a subs -dSary of PG&E Corporation, C201 1 PacJe Gas and Electric Compa^y. At[ rights reserved_ These offerings are funded by C -tl ornia utility customers and administered by PG&E under the auspices of the C . °ornEa Panic t,rOizies ommiss en. { PG&E prints its materials who soy based #nks6lon recycled paper.10 Apnt 2011 CTM -0710-0650 Page 2 of 2 0 CITY OF SAN RAFAEL INSTRUCTIONS: USE THIS FORM WITH EACH SUBMITTAL OF A CONTRACT, AGREEMENT, ORDINANCE OR RESOLUTION BEFORE APPROVAL BY COUNCIL / AGENCY. SRRA / SRCC AGENDA ITEM NO. DEPARTMENT Nader Mansourian Public Works DATE: 11/2/2011 TITLE OF DOCUMENT: DATE OF MEETING: 11/7/2011 RESOLUTION AUTHORIZING APPLICATION FOR THE ENERGY EFFICIENCY RETROFIT LOAN PROGRAM AND AUTHORIZING THE PUBLIC WORKS DIRECTOR TO SIGN A FINANCING SUPPLEMENT WITH PACIFIC GAS & ELECTRIC COMPANY (PG&E). Department Head (signature) (LOWER HALF OF FORM FOR APPROVALS ONLY) APPROVED AS COUNCIL/ AGENCY AGENDA ITEM: City Manager (signature) City Attorney (signatu41