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Home My WebLink About2015-04-14; City Council; 21928; Update Presentation Citywide Energy Efficiency Renewable GenerationCITY OF CARLSBAD - AGENDA BILL AB# 21,928 UPDATE AND PRESENTATION ON CITYWIDE ENERGY EFFICIENCY AND RENEWABLE ENERGY GENERATION PROJECTS DEPT. DIRECTOR p'^' DATE 4/14/2015 UPDATE AND PRESENTATION ON CITYWIDE ENERGY EFFICIENCY AND RENEWABLE ENERGY GENERATION PROJECTS CITY ATTL^ DEPT. PW-TRAN UPDATE AND PRESENTATION ON CITYWIDE ENERGY EFFICIENCY AND RENEWABLE ENERGY GENERATION PROJECTS CITY MGRr^QOljO RECOMMENDED ACTION: Receive an update and presentation on citywide energy efficiency and renewable energy generation projects. ITEM EXPLANATION: For more than a decade, the city has made efforts to promote energy conservation and development, with an eye on sustainable practices. Engaging in regional energy partnerships, implementing various energy pilot programs and adopting a set of Sustainability Guiding Principles are examples of the city's commitment to stewardship in this area. The city has deployed a proactive strategy to identify improvements in energy efficiency, demand management and energy generation. Building renovations to improve energy efficiency and demand management are currently budgeted as part of the approved Capital Improvement Program. In the area of energy generation, the city recently completed installation of solar photovoltaic panels at Alga Norte Community Park, and is in the process of installing a hydroelectric generator at Carlsbad Municipal Water District Connection No. 3, also known as the Maerkle Reservoir site. The development of additional renewable energy resources is also being driven by continually evolving state laws targeted at local government agencies, available financial incentives, future implementation of the city's draft Climate Action Plan, and a desire to reflect the community value of sustainability and environmental stewardship. Economic benefits to the city may be realized as a result of energy generation, efficiency and conservation efforts. Staff contracted with the Center for Sustainable Energy (CSE), a non-profit organization with demonstrated technical and policy expertise in sustainable energy programs, to evaluate the feasibility and fiscal impact of potential renewable energy projects. Specifically, CSE examined solar photovoltaic energy generation opportunities at the Safety Training Center and the Maerkle Reservoir sites. Based on new regulations issued by the California Public Utilities Commission, CSE selected a centralized approach for its fiscal analysis (see attached Exhibits 1 and 2). In addition, factors such as system size, cost per unit (watt) installed, power output per unit (kWh), system degradation annually, value of Generation per unit (kWh), benefit rate, and cost of money were considered. DEPARTMENT CONTACT: Joe Garuba 760-434-2893 joe.garbua@carlsbadca.gov FOR CLERK USE. COUNCIL ACTION: APPROVED • CONTINUED TO DATE SPECIFIC DENIED • CONTINUED TO DATE UNKNOWN CONTINUED • RETURN ED TO STAFF WITHDRAWN • OTHER - SEE MINUTES AMENDED • REPORT RECEIVED • _ • • • Energy Efficiency and Renewable Energy April 14, 2015 Page 2 of 2 Staff will be sharing the results of the CSE analysis, and the estimated aggregate impact of the city's energy conservation effort resulting from all sources of reduction and renewable generation. Based on the economic and environmental benefits, staff is planning to recommend proceeding with proposed solar photovoltaic installations at the Safety Training Center and Maerkle Reservoir. FISCAL IMPACT: There is no fiscal impact associated with the staff update. ENVIRONMENTAL IMPACT: Pursuant to Public Resources Code Section 21065, this action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. EXHIBITS: 1. Safety Training Center Energy Solar PV Financial Analysis 2. Citywide Solar PV Financial Analysis •a J3 •> -a n\ !S >l M Q- I < Off o trie Fiatt 1/kWh) d 1 » — 1 LU if) 1 „ 1 <Q >. 0.03 1 < « C •D E 0 Esttma^ Perf( Degrad; 1 i'8,461 1 161.00 3 so EPBB Annual 1 Productior 1 -'3-1 lied Cos 450,9 1 E Est t» E (115 1 mels Q. itovoltai 1 0 Effit unte lergy 1 )of mo J at 01 2" ^" IK (O icy o" is £^ lop CSi |(o' tfj- 1 K a" Is 8 f\J CM CO lo lo to to U) CO St 3: to to CO PI to" in m <*j 01 CO CD Ol CO lO lO T- o HI — , S ^ o o 1^ S 1 o lO nels 1 Q. o 'ra o o o CL ted un E a> ade Struci tal costs TO 2: - c > s; c Q O 0) t- .o 3 I I ts *- I 00 CO led CO I *~ Co 5 E O 0 "S O) Ol lO iq m 5 J? . ^ •^^ !£ S S to CD O I w w f** C^ CO S S trj Co" 5 o „ O J) " I o o — I CO to" I ^. j w *o I fs, CM J CO S 8 CM cs O IN ^ j to ico UV s s I Co '* I Q to r 0> O) PJ "T- »- Co ^3 (O = 2 5 S CM CM 'HI- CO- Co* K"" , N s: o cn o) «o 1*^ w t9 K K §• ^ to o o •» of to' 03 fNI CS| JO CO K C\f Cvj Oi K N. <ri to O o> t» CO to CN K." !C CT § S! t V V o" £5 2 2 O C3 t*5 3: 3 to (o M c^ vi *^ «9 S Si t 5 o c IK CO I to o> 1^ « I N. CO to CO CO »^ (<) cvi" c^-9 ° i?" s s § CO O)" Cvj" to to CS) CM — S If) to" (O to K CM Cvi r-W K" CO to o> Ul to CvJ K K to I to K I to CO iio" to' IK Oi 1^ 1o" • to O I Cvi K I CM K I CO £ i CO CO K K CO CO CO K ts. CM lO in CT) O) 5"» ^ o o I o o — — CO _ _ ^ • to C3 12"" JS" IcM U> ItO" CM" IM CS ICM to i-N" O" I I< ^ ^88 rj" CM .J ;? IS K ifl W jp* I *^ 6-9 5 S 5^ S S S CO CO CO V N CM CO S S 2 w w t-^ s § s to CO oj to" to' , CM C-J CM lo in "~ i*-* V) Q Q 1- (- Utilizing RES-BCT for the City of Carlsbad April 14, 2015 Jeremy Del Real, PE, Senior Manager of Engineering Our Mission: Accelerate the transition to a sustainable world powered by clean energy How RES-BCT Works •Allows local governments to generate renewable energy on one account and provide bill credits to a number of other accounts •Bill credits are calculated by multiplying the Generating Account's time-of-use (TOU) energy component of the generation electricity rate by the amount of energy exported to the grid during the corresponding time period. How RES-BCT Works •Eligible renewable generators are limited to 5 megawatts (MW) •Available until combined rated capacity reaches SDG&E’s share of 8.1% of the statewide 250 MW limitation (about 20 MW) •Eligible accounts are limited to those served under time-of-use (TOU) rate schedules •Total number of benefitting accounts is limited to 50 How RES-BCT Works Electrical PowerHour Ending On-Peak Semi-Peak Off-Peak How RES-BCT Works T&D/UDC Commodity kWh kW Components of Electricity Costs How RES-BCT Works T&D/UDC Commodity kWh kW Components of Electricity Costs Offset by NEM NEM will not “ZERO OUT” your bills How RES-BCT Works T&D/UDC Commodity kWh kW Components of Electricity Costs Offset by RES-BCT RES-BCT will not “ZERO OUT” your bills RES-BCT credits retain about 60% to 90% of NEM How RES-BCT Works •So how do we make RES-BCT work for us?? –Leverage available tariffs on generating account –Appropriately distribute credits –Do not attempt to “zero out” your bill CSE’s RES-BCT Analysis Evaluated offsetting the City’s seven (7) largest TOU accounts using either NEM or RES-BCT (represent 50% of the City’s Commodity costs) •Maerkle Reservoir •Dove Library •The Police Station •Faraday Building •Water Recycling Facility •The Golf Course •Library Learning Center CSE’s RES-BCT Analysis •NEM System Trade Offs –Can potentially leverage alternative tariffs –Potential to offset greater portion of total electric costs –Potential additional cost savings from demand reductions –Potentially space constrained –Greater upfront cost from multiple smaller scale system installations CSE’s RES-BCT Analysis •RES-BCT System Trade Offs –Can leverage alternative tariff for generating account –Potential additional cost savings from demand reduction on generating account –Lower upfront cost from a single larger scale system –Potentially space constrained –Potential to offset lower portion of total electric costs CSE’s RES-BCT Analysis •CSE determined that RES-BCT would be more advantageous than NEM for solar on the seven (7) accounts •Through RES-BCT the City would be able to: –Install a larger total City wide capacity (kW) of solar –Potentially realize lower total upfront and O&M costs from a larger centralized system –Achieve greater net savings, greater savings to production ratio ($/kWh), and faster paybacks –Potentially offset a portion of all TOU accounts CSE’s RES-BCT Analysis •Primary drivers of the results –increased costs associated with installing smaller NEM systems at multiple sites over a single RES-BCT system at a single site –The recent significant increase to the DG-R commodity rates (as of August 2014) –In most cases, the NEM scenarios were constrained by available area so optimal system sizes could not be achieved –Existing tariffs and profiles in the NEM scenarios did not offer as great of savings even with optimal system sizes Other RES-BCT Projects in the State •As of Q2 of 2014, PG&E has 4 customers that have implemented RES-BCT with a total 3.495 MW. •As of March 12, 2015, SCE has 8 projects with permission to operate through RES-BCT for a total of 16.87MW. Jeremy Del Real, PE Senior Manager of Engineering 858-429-5126 jeremy.delreal@energycenter.org Carlsbad’s Approach To Energy Joe Garuba Municipal Property Manager April 14, 2015 Agenda •Background •Key Motivations •Strategic Approach •Renewable Energy Development Opportunities •Next Steps Background •City has been working on energy conservation and development for past 15+ years •Regional Energy Partnership •Energy Pilot Program •Guiding Principles Key Motivations •Changing state law •Climate Action Plan •Environmental Stewardship •Economic Benefits Strategy Efficiency Generation Demand Management Efforts To Date •Energy Efficiency –Lighting/HVAC –Street light conversion –Roof Coating •Renewable Energy –Alga Norte Solar –Maerkle Hydroelectric Moving Forward •Existing building renovations –IRF Program •Develop additional renewable energy sources –Individual sites vs. consolidated approach Center for Sustainable Energy •City contracted with Center for Sustainable Energy (CSE) to evaluate solar pv opportunities •CSE evaluated a distributed vs. a centralized solar develop •The centralized approach was based on new regulations from the California Public Utilities Commission PV Analysis Factors and Assumptions A.System Size B.Cost per unit (watt) installed C.Power output per unit (kWh) D.System degradation annually E.Value of Generation per unit (kWh) F.Benefit Rate –How much will electricity go up annually G.Cost of Money –city’s interest rate Solar PV Analysis •Maerkle –System Size -2.8 megawatts –Produces 5,000+ megawatt hours annually –Projected cost -$9.35 million –Projected benefit -$19.5 million –Estimated Payback –10.78 years Solar PV Analysis •Safety Training Center –System Size –115 kilowatts –Produces 178,000 kWh annually –System Cost -$450,000 –Projected Benefit -$1.19 million –Estimated Payback –9.47 years Energy Efficiency and Generation Efforts Remaining City Usage 41% Projected Efficiency Goals 15% Maerkle solar 36% Alga Norte Solar 3% Maerkle Hydro 6%STC Solar 1% Next Steps •Return to City Council –Approve design/build contract for STC Solar PV project –Appropriate $250,000 to develop plans and entitlement for Maerkle •Benefit to CMWD •Structure of project •Funding sources •Applicable accounts •System size (scalable) •Design Questions 15