Transcript Making MUSH Energy Efficient - Institute for Research on

Making MUSH Energy Efficient
Satya Rhodes-Conway
COWS
June 16 2011
COWS
“Milk for the Movement”

Research center at
UW Madison

“Think-and-do
tank” for high-road
economic
development

Good jobs and
clean energy
MUSH?


Municipal/Government, University,
School, and Hospital - Buildings under
governmental control
 State, County, City, Town, etc.
 schools (public and private); colleges,
universities, and technical colleges
 hospitals, clinics, and other
healthcare facilities
 assorted large institutional buildings,
such as museums, places of worship,
and nonprofits
Type of Building Owner
Number
State
50
City
19,492
County
3,033
Town
16,519
Special District
37,381
School District
13,629
Private K-12 School
33,740
Charter School Agency
2,236
Public Higher Education
2,672
Private Higher Education
2,823
Hospital
5,795
Number of buildings?
Total
137,370
Key Attributes


Decision-makers usually control multiple buildings
Energy intensive buildings






Older
significant energy users such as water utilities, water
treatment facilities, hospitals
Energy costs can be up to 10% of a municipal
Beyond the profit motive
No split incentive
Longer time horizon
Energy Efficiency


Investment-grade audit
measures that increase the energy efficiency and are
cost effective over a reasonable time horizon






efficient lighting
improved heating, ventilation and air conditioning systems
tightening the building envelope
Motors and appliances
Etc.
Ongoing building management
Why?
Save Money
 Reduce Emissions





air quality
public health
global climate
disruption
Increase Energy
Security


price volatility
supply disruption

Economic Development



direct spending
redirection of dollars saved
Comfort and Health



Increased productivity
Decreased absenteeism
higher student test scores
Pete Davis
Current Status
Energy Services Corporations (ESCOs) have
worked in this sector for decades
 market penetration in the MUSH sector: 20%
to 50%




comprehensiveness of the retrofits performed?
new technology
Plenty of opportunity
Barriers






Upfront capital cost
Inability/limited ability to borrow/bond and impact of
project bonding on credit rating
Diffuse control of buildings and/or building systems
Lack of reliable information on energy expenditures
Turnover in elected/appointed leadership
Lack of experience with energy efficiency, ESCOs,
etc.
Principles

Job Quality and Opportunity



Direct control over the contracting process
Ensure that jobs created are good
Sustainable Financing

Managing your own project may be cheapest





General Obligation bonds (secured by the ability to levy taxes)
Revenue bonds (secured by the expected revenue, in this case the
expected savings)
Qualified Energy Conservation Bonds (QECBs), a relatively new type
of taxable bond subsidized by the Federal Government
Work with ESCOs
Capture a portion of the savings for use on future projects
Principles

Data-driven decisions

which buildings ought to be retrofitted, in what order, using
which technologies?



EnergyStar Portfolio Manager
measurement and verification
Deep Retrofits



longer payback periods and higher upfront costs
increases in energy savings, job creation, and environmental
benefits
energy savings from buildings with significant savings
potential can be used to offset the cost of pursuing retrofits
in buildings with less potential
Principles

Build strong and independent partnerships




Housed in a non-political department or in a separately created new
entity
If a program is contracting with an ESCO, the use of an Owners Agent
Build a coalition
Maximize scale



aggregating properties with similar entities
bundled with other capital improvement or renewable energy
generation
larger organizations (especially states) assist smaller entities by
facilitating aggregation, providing technical assistance, or creating a pool
of capital
Principles

Best practices in workforce development

connecting individuals to construction apprenticeships




Community Workforce Agreement (CWA)
high-quality pre-apprenticeship or contextualized basic skills training
social services
Implement complementary policies




drive demand for in the commercial and residential
support a contractor base and workforce able to meet that demand
Generating market demand for efficiency through labeling
Requiring energy efficiency upgrades through Residential/Commercial
Energy Conservation Ordinances or retro-commissioning programs
Possible savings

MUSH floor space





about16.5 billion sq ft.
uses about 3.87 quadrillion BTU a year
energy costs about $40.7 billion a year
20% savings would be $8.1 billion dollars per year
Example: City of Milwaukee




municipal operating budget of $69 million per year
controls 229 buildings
spends approximate $16 million per year on energy.
could save nearly $5 million per year
Possible jobs
Primarily construction jobs
 Every $1 million spent on energy efficiency
projects creates or retains between 4.3 and
8.6 FTE
 Between $38.3 billion to $61.2 billion needed
to upgrade the entire MUSH sector
 Potential to create between 164,690 and 526,
320 FTE

How?



Assess your building stock energy use and prioritize
Audit
Financing options




RFP




Bonding
ESCO, municipal lease
Design/Build
owner’s agent
Include labor standards
Capture savings
Track building performance
It makes sense…




economic crisis
unemployment rates (especially in the construction sector)
environmental imperative
large-scale energy efficiency building retrofits drive job
creation


economic, environmental, and community benefits
Relatively straightforward




buildings are controlled by those who have a broader public interest
can determine how much energy they use
can finance the retrofits
can ensure that jobs created are good jobs

….it doesn’t make sense not to
[email protected]
608 262 5387
www.cows.org
www.efficiencycities.org