by Brianna Crandall — May 30, 2012—As part of the Obama Administration’s commitments to save energy and reduce energy costs at federal facilities while creating jobs and protecting the air and water, the U.S. Department of Energy (DOE) announced on May 24 an Energy Savings Performance Contract (ESPC) project awarded by the Federal Aviation Administration’s (FAA) Northern California Terminal Radar Approach Control (NCT-TRACON) facility to NORESCO, LLC. The project, which will leverage almost $1.9 million in private sector investments for energy efficiency and water conservation measures at the Northern California facility, stands as a model for other federal facilities seeking ways to cut energy usage and costs.
This new project includes a power purchase agreement (PPA) that will help to finance an onsite, one-megawatt photovoltaic (PV) solar energy system, bringing the total contract value to $9 million. A PPA is a formal agreement to purchase power at a fixed price over a fixed period of time. The price of energy guaranteed through the PPA is lower than the current and projected cost of electricity that would otherwise be used by the facility, making the project cost-effective over its lifecycle and achieving savings for the federal government over the long term. The PV system will provide up to 50% of NCT-TRACON’s electricity at the Mather, California, facility, while creating covered parking for the facility’s employees. The project also includes lighting upgrades, water conservation upgrades, and an energy management control system.
The combination of renewable energy and energy efficiency measures is expected to save the facility 7.7 billion Btu per year, or enough energy to power more than 80 homes. In dollar terms, the energy efficiency measures will save NCT-TRACON at least $334,000 on energy and water costs in the first year and $9 million over the life of the 20-year contract. The savings on utility bills created through the facility upgrades will be used to pay for the project over the term of the contract, and the FAA will continue to save energy and money after the contract term has ended. In addition to the cost savings generated from the project, the site’s carbon dioxide emissions will be reduced by approximately 46% and its water use reduced by 40%.
In December 2011, President Obama announced the investment of nearly $4 billion in combined federal and private sector energy upgrades to buildings as part of the Better Buildings Initiative. The Administration issued an accompanying Presidential Memorandum committing the federal government and its agencies to enter into a minimum of $2 billion in performance-based contracts to improve federal building energy efficiency over the next two years. The White House expects the investments to save billions in energy costs, promote energy independence, and, according to independent estimates, create tens of thousands of jobs in the hard-hit construction sector.
The Energy Department says its ESPC Indefinite Delivery Indefinite Quantity (IDIQ) contracts are available to all federal agencies. DOE provides the expertise for both technical and financial aspects throughout the development of each project. The federal government is the largest single user of energy in the United States, and ESPCs provide federal agencies with access to project funding at a scale that is needed to meet the challenge of reducing energy and water consumption and boosting the use of renewable energy. For more information on energy savings performance contracts, visit the ESPC Web page.
DOE’s Office of Energy Efficiency and Renewable Energy (EERE) accelerates development and facilitates deployment of energy efficiency and renewable energy technologies and market-based solutions. Find out more about how DOE provides the services, tools, and expertise to federal agencies to help them achieve their federal energy management goals at the Federal Energy Management Program’s Web site.
