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CC - Approval of an Agreement with Comet Electric in an Amount Not-to-Exceed $750,980.73 for the Energy Efficiency Streetlight Upgrade Project (PZ-684) and Related Budget Amendment to Provide Up-Front Funding.
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Contact Person/Dept: Mate Gaspar / Public Works
Phone Number: (310) 253-5602
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [] Attachments: Yes [X] No []
Commission Action Required: Yes [] No [X] Date:
Commission Name:
Public Notification: (E-Mail) Meetings and Agendas - City Council (08/06/15)
Department Approval: Charles D. Herbertson, Director of Public Works/City Engineer (10/05/15)
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RECOMMENDATION
Staff recommends the City Council approve an Agreement in the amount not-to-exceed $750,980.73 with Comet Electric for the Energy Efficiency Streetlight Upgrade Project, PZ-684, and related Budget Amendment to provide up-front funding.
A budget amendment requires a 4/5ths affirmative vote
BACKGROUND
In 2011, Southern California Edison (SCE)’s launched the On-Bill Financing Program (Program). This Program, which is funded by California utility customers and administered under the auspices of the California Public Utilities Commission, allows governments and other eligible customers to finance energy efficiency projects using zero-interest loans that are paid back through the energy savings that are achieved through those projects. The City applied and was approved for the maximum $250,000 zero-interest loan for replacement of 625 light fixtures on arterial streets with energy efficient induction lights. The project was successfully completed in 2012. There are approximately 3,600 streetlights in the City.
Since the project was completed, Staff has been working with The Energy Network (TEN) to implement other turn-key energy efficient projects Citywide. TEN, administered by Los Angeles County, was created by the California Public Utilities Commission to help eligible public agencies in Southern California implement such projects to save energy and reduce operating costs.
DISCUSSION
This proposed project will retrofit a total of 1,491 unmetered streetlights in the City with new energy efficient light fixtures.
• 651 cobra-head style streetlights on arterial streets will be replaced with induction fixtures.
• 533 cobra-head style streetlights on residential streets will be replaced with LED fixtures.
• 307 acorn post top style streetlights on the residential streets will be replaced with post top LED decorative fixtures.
Based on the audit report prepared by TEN, replacing the existing luminaires with induction and LEDs fixtures have the potential to save Culver City $119,000 in annual energy costs (an annual electricity savings of 970,771 kWh, approximately 63% of current electricity usage for the streetlights being replaced).
• The estimated useful life of the LED fixture is 65,000 hours or ~15 years.
• The estimated useful life of the Induction fixture is 100,000 hours or ~ 20 years.
City staff chose Comet Electric to provide a cost proposal for this project as they have successfully completed energy efficiency projects at other City buildings. Comet Electric’s cost proposal is $750,980.73. Comet Electric is pre-approved and selected through the National Joint Powers Alliance (NJPA); which is a public and transparent bidding process to create a pool of qualified contractors for such projects. The services provided by these contractors are exempt from the formal bidding requirements pursuant to Culver City Municipal Code Sections 3.07.045.G (competitive bid procedures have already been utilized by NJPA).
The proposed project will begin soon after the agreement is executed.
FISCAL ANALYSIS
Initially, the City will be required to expend the $750,980.73 in project costs. Once the project is complete, with rebates and incentives approved through SCE’s Customized Incentive Program, the City will receive funding in the amount of $166,309 to offset the total project costs. The remaining project cost of $584,671 ($750,980 - $166,309) will be funded as a loan through SCE’s zero percent APR On-Bill Financing program. The City will pay back SCE via monthly payments estimated at $9,744 that will appear as a separate line item on the streetlight electric bills. However, there will be no increase in the electric bill as the additional charge will be offset by energy savings. The payback period is approximately 4.5 years and the project will save the City approximately $119,000 annually in electric costs.
A budget amendment from the General Fund Reserve is being requested for the following accounts. SCE will remit payments ($166,309 in incentives and $584,671 in loans) to the City once the project is completed.
Expenditure Account:
Street Light Upgrades 42080000.730100.PZ684 $750,980.00
Revenue Account:
Energy Efficiency - Rebates/Incentives 42080000.348210.PZ684 $166,309.00
Energy Efficiency - SCE Loan 42080000.348210.PZ684 $584,671.00
A budget amendment requires a 4/5ths affirmative vote
ATTACHMENTS
1 Street Lighting Audit Report prepared by TEN
2 Street Lighting Contractor Scope of Work prepared by TEN
3 Comet Electric cost proposal
RECOMMENDED MOTIONS
That the City Council:
1) Approve an Agreement in an amount not-to-exceed $750,980.73 with Comet Electric for the Energy Efficiency Streetlight Upgrade Project, PZ-684; and,
2) Authorize the City Attorney to review/prepare the necessary documents; and,
3) Authorize the City Manager to execute such documents on behalf of the City; and,
4) Approve a budget amendment in the amount of $750,980.00 to provide up-front funding to complete the Project (A budget amendment requires a four-fifths vote).