Implementing Energy Programs in Schools - An Interview with Ash Awad, McKinstry Co., Seattle
January 2007
GreenSmart –
Q: School districts always face tight budgets. How can they find ways to pay for energy updates in retrofits or new construction?
A: Many times there are utility rebates that pay for a portion of a project that yields energy savings beyond the energy code. Approaching local utilities and governmental agencies about rebates and energy saving programs is the first step. Then we look at the total cost of ownership, as opposed to the initial cost.
You have to study the entire facility when you decide where to spend budget dollars. Look at things that will save money in operational costs instead of spending more money on aesthetic features. Most organizations can blend the combination of bonds with alternative financing through leaseback options to fund more efficient systems. Blending performance based contracting with bond dollars will increase overall budget of the project, secure rebate dollars and yield alternative funding options to stretch scarce dollars.
Q: What are some of the projects that you have worked on where this benefitted the school district?
A: Three years ago at the Northshore school district (in Bothell, Wash.) we went through a systematic process of refurbishing 20 of their school sans working with Puget Sound Energy to fund about 30 percent of that work through utility grants. That district took capital dollars and utility funding and updating aging heating and ventilation equipment that yielded $180,000 per year in energy savings overall. That money goes back into the school district general fund. Specifically at one of the junior high schools we replaced an air handling unit and put in more efficient equipment that improved ventilation and reduced operating costs – a win-win.
Q: What is the most innovative example of combining funds?
A: In Oregon, there is an energy tax credits and significant rebates from utilities. The Enterprise School District is combining several programs to install more efficient boilers. Instead of using diesel or propane, they are considering the use of wood chips to fire the boilers, basically allowing them to qualify for a leaseback and getting funding for using biomass fuel. The rebate comes from SB1149 funding and is a significant way to allow districts to do some of this work. It might cover 20 to 30 percent of projects. Oregonians also have access to a business energy tax credit (BETC) which can offset between 28 and 35 percent of the cost of the project. In the state of Washington, we have no tax credits. We have no income tax, only a retail tax. Districts still have to pay the retail tax on whatever energy efficient equipment they buy.
Q: What incentives do school districts have to improve energy efficiency?
A: Most districts never get enough funding for deferred maintenance. This gives a way to secure rebates to get heating renovation and ne weighting systems replaced. There is a double win in that then there is enough funding for energy improvements. Anybody in a poor environment will not perform optimally – it’s all very easy to imagine that if they are cold in the winter and hot in the summer any improvements have to translate into an improvement in how they perform. Not only that: making schools more efficient helps operations costs – and sometimes they can send that savings to the general fund. Schools end up with improved assets, a more efficient use of capital dollars and more money for books and teachers.
Q: How do you find out about rebate programs?
A: Approach local utilities and see what rebate programs are available. Larger utilities have staff members who will come out to the school and do an energy audit. It’s in the utilities’ best interest to only give as much money as it takes to get a project going. The schools role in this process is to optimize dollars, or to get as much money as necessary to gain the highest efficiency.
Energy Services companies like McKinstry will do a detailed energy audit and analysis, and work with the utilities to optimize the rebate on behalf of the school district. Utilities appreciate our approach to energy analysis since our approach is quite detailed. It has to be since we guarantee both the first cost of the project and the annual energy savings. If the new system that we install doesn’t save as much money as we think it will, somewhere down the road we’ll be writing a check to make up for those savings shortfalls.
- By Lucy Bodilly
GreenSmart - Sustainable Building in the Northwest - July 2007
