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NAESCO Newsletter

First Quarter 2010

Featured Articles

NAESCO Updates


Advocacy

  • NAESCO Advocacy Report
    NAESCO’s advocacy work continues to expand to ensure that the growing number of energy efficiency initiatives across the country are cost-effective, sustainable, and offer new opportunities for ESCOs and other NAESCO members.

New Members

NAESCO welcomes the following new members:

Upcoming Events

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For a full list of all NAESCO Member News, please click here.


Featured Articles

Interview with Greg Kats of Good Energies
 

Greg Kats is a Managing Director of Good Energies, a leading global investor in renewable energy and energy efficiency industries with $6 billion under management. He leads Good Energies investments in energy efficiency and green buildings. Mr. Kats is a founder of newsourcebank – the first U.S. green bank, and he is a founder of the American Council on Renewable Energy. Recently, Mr. Kats authored Greening Our Built World which evaluates the cost effectiveness of “green community development” and presents the results of the first-ever survey of green buildings constructed by faith-based organizations.

What motivated you to write Greening Our Built World?
We are going through the beginnings of a green revolution that will involve large scale projects designing and retrofitting buildings. The purpose of this book was to explore whether green building was a niche industry or if it would go mainstream. Additionally, I wanted to explore its cost effectiveness. After receiving detailed information on 170 green buildings, I think we have a definitive answer that on average green buildings have high energy savings and reduced risks. The high profiles of the book’s sponsors, the American Council on Renewable Energy, the American Institute of Architects, the American Public Health Association, BOMA International, Enterprise Community Partners, the Federation of American Scientists, the National Association of Realtors, The National Association of State Energy Officials, the Real Estate Roundtable, the U.S. Green Building Council, and the World Green Building Council, demonstrate that the book’s analysis is mainstream and driven by private interests. Lastly, buildings are where we spend the majority of our time so it’s important that we are using energy effectively there.

How big of a role do you think energy efficiency plays in the green economy?
Energy efficiency is by far the single most important piece of a green economy and the single most important attribute of green building. The US is the Saudi Arabia of energy efficiency; we can cost effectively reduce energy 50% in buildings and in the future, we can gut it by 70%. Greening is a cost effective means of achieving deep energy efficiency gains for both older and new buildings. Of the 170 green buildings we looked at, 18 buildings had energy efficiency retrofits, those buildings on average had about an 80% cut in their carbon emissions. Data shows you can have deep reductions in energy use through energy efficiency and renewable and cost effectively reduce energy by 50%. The technologies we are investing in at Good Energies, get to zero net energy for most buildings in 5 years.

In Greening Our Built World, you outline the employment benefits offered by green building; are there any technologies or investments that you feel could create more green jobs?
Green buildings typically divert 80-90 percent of waste through separation, recycle, reuse compared to 30 percent through non green buildings. Diverting waste results in twice as many jobs as opposed to going to the dump because diverting waste is more labor intensive. Energy efficiency is also an important security issue in both the military and the economic sense of the word. Investments in energy efficiency make cities more competitive. Wasteful practices results in cities being less competitive.

What role do you see the ESCO community playing in the “green” economy?
ESCOs are the most important institutions driving energy efficiency. They have deep skill sets and a strong emphasis on measurement and verification. They continue to expand technologies they use to deliver results for their clients including onsite generation.

Are there any emerging green technologies that you feel offer great potential?
There are several new technologies that offer great potential: daylight harvesting, which uses daylighting first and artificial lighting only when you need it. High performance glass gives you enormous control over lighting quality. Ground source heat pumps use the earth's temperature to provide heating, cooling, and hot water. Ice storage allows you to operate your air conditioner at nighttime to get substantial electricity reductions. Distributive storage uses wind to displace peak load energy. Alert me, allows me to manage and monitor energy use in my building from around the world.

What are your thoughts on the current state of climate legislation?
It’s an uphill battle, the science is overwhelmingly clear. It’s unfortunate it’s become a partisan issue especially because the Republican Party has a long tradition of environmental protection, Teddy Roosevelt, Richard Nixon, George H. Bush were all environmental leaders. It’s depressing to see much of the party in denial of the science. It is also counter productive, pessimists and climate deniers think Americans lack the skills and innovation to achieve improvements and reduce waste. As a venture capitalist, I am very optimistic about America’s technical capability. I am also optimistic that the average American can reduce energy waste and America’s ability to capture a big part of the global industry. Those who deny climate change are doing a disservice to our competiveness.

How great of an impact do you feel this Administration’s investments in efficiency and renewable energy will have on the market itself?
Large, there has been a lot more investments in efficiency. People know that people are serious about reducing energy waste and saving tax payer dollars. They understand that the DOE is committed to economic competitiveness and energy performance by building strong US manufacturing capabilities around clean energy technologies that could rapidly expand US employment and US exports.

Greening Our Built World was published by Island Press and is available for purchase on their website which can be accessed here.

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NAESCO Updates

Advocacy

 
During the fourth quarter of 2009 and the beginning of 2010, NAESCO concentrated its advocacy efforts on federal government energy efficiency initiatives and on several states that are implementing new energy efficiency programs or which have significant ESPC program issues.

FEDERAL

At the federal level we have been working on the issues surrounding the implementation of the American Recovery and Reinvestment Act, the inclusion of new funding for energy efficiency in the upcoming Jobs Bill and the development of energy and climate legislation.

American Recovery and Reinvestment Act (ARRA)
The ARRA, better known as the stimulus bill, appropriated more than $20 billion for energy efficiency and renewable energy programs, as well as another $20 billion of potential tax credits. The $20 billion of appropriations is supposed to be spent very quickly, with all funds contractually obligated in the next two years. To date, the implementation of ARRA by the US Department of Energy (DOE) is lagging. DOE reports that it has paid out about 6.5% ($2.1 billion of the authorized $32.7 billion) of its ARRA funding. The “authorized” figure does not include the Loan Guarantee program, another $4 billion. (www.energy.gov/recovery/) Drilling down further to the programs that are administered by the Office of Energy Efficiency and Renewable Energy (EERE), the figures are $16.8 billion authorized and $687 million spent (about 4%). NAESCO recently distributed a detailed report on the status of ARRA funding and the barriers to ARRA expenditures, which is available on the NAESCO website.

NAESCO ARRA Advocacy Activities
NAESCO has been working with the National Save Energy Coalition, which consists of hundreds of environmental, and energy efficiency groups, industry trade associations and major companies to try to accelerate the implementation of the ARRA programs. The Coalition is in regular contact with White House and US DOE officials to push the resolution of the issues that are holding up the expenditure of SEP and EECBG grant funds.

NAESCO is also part of a small “SWAT Team” convened by US DOE to address the implementation of revolving loan funds and other finance plans that are elements of many SEP and EECBG plans. According to DOE, approximately $1 billion of the available grant funds will be devoted to revolving loan funds, most of which will be administered by government agencies with little or no relevant experience. The SWAT Team is assembling guidance documents and best practices program guides that are distributed to the grantees through the US DOE website and a series of webinars that are scheduled on a weekly basis. One of the two major focuses of the SWAT Team is to ensure that the loans funds will able to work efficiently with public building ESPC projects. NAESCO is concentrating its work in this area. The documents and downloadable versions of the past webinars are available on the US DOE website.

NAESCO is also part of a consortium that submitted proposals to US DOE in the competitive EECBG program described above. NAESCO’s role in the consortium will be to ensure the public building ESPC programs are a major element of the proposed programs, and to provide training to local government officials that will implement the ESPC programs. The consortium anticipates submitting four different proposals from four regional groups of communities – Southeast, Midwest, California and Northeast.

To multiply our resources for this effort, NAESCO, in collaboration with the Energy Services Coalition and NASEO, submitted a proposal to US DOE for a grant to provide training and technical assistance to states and local governments that will be implementing ESPC programs as part of their SEP and EECBG plans. This unsolicited proposal has now been superseded by a DOE solicitation for technical assistance that is being run by the Oak Ridge National Laboratory. NAESCO has received word that it is part of the winning bid for Task 3, Financing Programs.

The Jobs Bill
The Congress is now working to assemble a set of smaller stimulus bills, which are currently called the Jobs Bill, to be considered in March. There is a lot of maneuvering about the composition of the bills, which will apparently include extensions of tax credits (such as energy efficiency new home construction). One component of the bill will apparently be a residential program called Home STAR, which has been dubbed “Cash for Caulkers.” President Obama has embraced the program concept for its populist appeal (every voter can participate). Manufacturers and big box stores that sell insulation and equipment to homeowners are supporters. NAESCO has been working with two national coalitions to ensure that companion legislation called Building STAR will provide rebate and enhanced tax incentives for the commercial and industrial sectors. We now understand that Senator Merkley (D-OR) as a separate bill will introduce Building STAR. NAESCO has drafted and circulated to key Congressional staffers a measure that provides a dedicated funding stream to the MUSH markets, because we believe that these markets have special characteristics that require dedicated legislation. This proposal has foundered because of the slow pace of ARRA implementation. There is also now some talk in the advocacy community that some of the energy provisions of the energy and climate legislation (see below) may be included in the Jobs Bill.

Federal Energy and Climate Legislation
The third major federal initiative combines two initiatives that had previously been separate: national energy efficiency and renewable energy resource standards (EERS and RES) and a national greenhouse gas emissions reductions policy (GHG). The House of Representatives passed the American Clean Energy and Security Act of 2009 (ACES) on a very close vote in late June. The Senate is now considering its own version of the bill, which is being assembled in separate bills being considered by the six Senate Committees that have asserted jurisdiction of parts of the legislation (e.g., Energy and Natural Resources, Environment and Public Works, etc.). The first of these bills, the American Clean Energy Leadership Act (S. 1462, or ACELA), passed the Senate Energy and Natural Resources Committee on June 17th by a vote of 15 to 8. ACELA contains no climate change or cap-and-trade provisions, because they are under the jurisdiction of the Environment and Public Works Committee. Senator Boxer (Chair of EPW) and Senator Kerry released their draft bill, the Clean Energy Jobs and American Power Act (CEJAPA or the Kerry-Boxer Bill) in late September and passed the bill out of Committee without debate because the Republican members of the Committee boycotted the Committee meetings.

Shortly after the Committee action on the Kerry-Boxer Bill, Senator Kerry announced that he would work with Senator Graham (R-SC) and Senator Lieberman (I-CT) to draft a compromise bill that can draw broad bi-partisan support. The Senators issued an outline of their bill before the UN Climate Conference in Copenhagen, but to date there is no flesh on the skeleton. We are now hearing that a bill may be ready by April.

Senators Cantwell (D-WA) and Collins (R-ME) introduced a third bill in late December in late December. Their bill, which is entitled Carbon Limits and Energy for American Renewal (CLEAR) has many of the same GHG reduction goals as the Waxman-Market and Kerry-Boxer bills, but has a much simpler enforcement mechanism. Instead of the elaborate emissions allocations formulas in Waxman-Markey and Kerry-Boxer, the Cantwell-Collins bill would auction all allowances. About 75% of the auction proceeds would be returned to consumers as rebates, with the remaining 25% retained by the Federal government for deficit reduction.

Energy Efficiency Policy - RES and EERS
Both ACES and ACELA mandate a number of national energy efficiency programs, including a Renewable Electricity Standard (RES). This means that utilities must by a date certain procure a mandated percentage of their energy from renewable sources. ACES mandates 20% by 2020; ACELA mandates 15% by 2021. In both bills approximately one quarter of the mandate can be met with energy efficiency. This is commonly known as an Energy Efficiency Resource Standard or EERS.

NAESCO is part of a national coalition that is exclusively focused on making a standalone EERS a major provision of the legislation. Twenty-two states now have EERS mandates for their utilities. We are asking the Senate to enact a minimum 10% standalone EERS, independent of whatever they may decide to do with and RES. Senator Schumer (D-NY) has said that he will sponsor the 10% EERS. NAESCO Chairman Adam Procell has tried to recruit other Senators as sponsors, by asking Senator Hagan (D-NC) to sign onto the EERS. NAESCO will be approaching other companies to lobby their home state Senators in support of a stand alone EERS.

It is important to note that the argument for a strong national EERS is supported by a virtual blizzard of research reports that document the economic development and job creations of energy efficiency.

GHG Reduction or Climate Change Policy
The GHG provisions of the legislation involve the establishment of a national carbon cap-and-trade system, in which the federal government issues a limited number of carbon emission allowances (in effect permits to emit CO2). The number of allowances is reduced each year to reach the target level of emissions in a future year.

The first major debate is about how the initial allowances will be distributed. The Obama administration has proposed that all allowances be auctioned. Industries (including utilities) that emit large amounts of CO2 have argued that forcing them to purchase allowances at auction will deal the economy a body blow, by increasing the cost of energy, and so they should be granted allowances at no cost.

The second major debate is about the use of the proceeds from the allowance auctions. NAESCO and the national coalition are urging that a substantial portion of the proceeds be invested in energy efficiency programs, because EE programs produce CO2 emissions at a negative net cost. Consumer groups and advocates for low-income ratepayers insist that most of the proceeds should be rebated to ratepayers. Advocates for utilities and energy intensive industries would like to see a substantial portion of the proceeds used to help them defray the cost of implementing emissions reduction technologies.

The coalitions that include NAESCO are arguing that cap-and-trade is important because it produces the revenues that can finance large-scale national EE programs. We are urging that the legislation mandate that substantial portions of the allowances be used to finance EE programs.

Media and Messaging
NAESCO is part of the National Save Energy Coalition (NSEC), which is concentrating on communicating the job creation and economic development benefits of EE to the Congress and the public. NSEC is organizing a grassroots campaign of hundreds of energy efficiency and renewable energy providers to counter the huge national media campaign, financed by energy producers and utilities that is delivering the message that climate change legislation will cripple the national economy. NAESCO believes that by participating in this national communications effort we can also help to realize our own communications goals – to build the national reputation of the ESCO industry. NSEC holds monthly webinars on the status of federal legislation. NAESCO is a presenter in all of these webinars.

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REGIONAL

The most important regional initiative that NAESCO is working on is in the Northeast: the Regional Greenhouse Gas Initiative (RGGI).

RGGI
RGGI is a prototype of a national carbon cap-and-trade program that encompasses nine Northeastern states that auction carbon emissions allowances and invest the auction proceeds in energy efficiency programs. These RGGI-financed programs are complementary to the substantial utility and state-administered EE programs in each of the RGGI states. NAESCO was appointed to the Advisory Committee for the New York program (approximately 34% of the total RGGI program) that advises NYSERDA, the program administrator on the composition of the RGGI program portfolio. So we are getting useful early experience with the issues that will affect the investment of the proceeds of a national cap-and-trade program.

NYSERDA’s initial program plan, approved last year, budgeted about $525 million over three years. The draft revised program plan budget, presented to the Advisory Committee today, is reduced to about $301 million by two factors. The first is that because of the recession the value of the allowances has dropped significantly, from $3/tonne to $1.86/tonne. The second is that the Governor and the Legislature have appropriated $90 million from the RGGI proceeds to help balance the state budget. Lessons learned are that the auction proceeds may be volatile during the early years and that the proceeds are always subject to diversion from energy programs to other government programs.

On top of these two major adjustments on the revenue side, the Legislature passed Green New York legislation, which mandates that about $125 million of the $301 million be spent on residential and small commercial building EE programs and workforce training. NAESCO and other members of the Advisory Committee questioned whether this money could actually be spent effectively, since it is additional to substantial sums from EECBG, WAP, the NYSERDA and utility ratepayer-funded programs, and the Home STAR provisions of the pending Jobs Bill. The answer to our questions was that the Green Buildings spending mandate is absolute and not subject to NYSERDA’s judgment as program managers. The lesson learned is that mandates for the expenditure of auction proceeds or emissions allocations do not optimize the use of those funds.

To accommodate the Green New York mandate, NYSERDA is proposing to eliminate a program that NAESCO believes is at the core of the RGGI concept – a program that solicits competitive bids for innovative carbon emissions reductions – and to reduce funding for commercial and industrial building programs. The rationale for reducing the C/I programs is that that the ARRA SEP funding, which was not anticipated when the original program plan was approved, is supplying more money for MUSH market buildings than the RGGI budget reduction. The elimination of the competitive bidding program is apparently a trade-off to allow the continuation of several R&D programs (carbon sequestration and smart grid). It is not clear to NAESCO, and to other Advisory Committee members, that the research programs are meaningful, in light of the billions that are being spent on R&D in these areas across the country. The Advisory Committee discussion indicated that these research programs are politically untouchable, despite their questionable value.

NAESCO will now work with other members of the Advisory Committee to attempt to restore funding to these programs.

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STATES

Perhaps the most exciting development at the state level is the flurry of activity related to the receipt and dissemination of the federal ARRA funding, which will invest about $11 billion in state and local government EE programs in the next two years. But while the states and local governments are working on their ARRA implementation plans, a number of states are instituting or expanding ratepayer-funded EE programs. Some states in which NAESCO has been working are highlighted below.

California
On September 24, 2009 the California Public Utilities Commission approved about $3.1 billion for energy efficiency programs in the 2010-2012 program cycle. This is a major re-affirmation of the importance of energy efficiency to the future of California’s struggling economy. During the months that preceded the Commission’s decision, NAESCO filed two rounds of comments stressing the need for timely Commission action and full funding of current programs until the new programs start in the first quarter of 2010. NAESCO is now working to digest the massive EM&V reports that evaluate the results of the 2006 cycle of programs. These will guide the structure of future program cycles and influence the national standards for utility program EM&V.

Texas
The PUCT is considering a rule change that would significantly increase the goals for energy efficiency and demand reduction programs. NAESCO is participating in the proceeding that will involve at least two rounds of comments.

Massachusetts
The state is approximately doubling its energy efficiency programs, pursuant to the 2008 Green Communities Act. Utilities have filed implementation plans. NAESCO is participating in a statewide coalition of energy and environmental groups, and is co-sponsoring, with the state Division of Capital Asset Management (DCAM) and the Division of Energy Resources, a series of meetings and workshops about how to maximize ESCO participation in Green Communities and ARRA program implementation.

New York
The Energy Efficiency Performance Standard (EEPS) proceeding, which approximately triples EE funding and puts utilities back into EE program administration, is now beginning full implementation. NAESCO is participating in the Evaluation Advisory Group, the successor to the SBC Advisory Group, which is setting program EM&V standards and protocols. Later in the year, the PSC will consider the renewal of the Energy $mart program, the main NYSERDA program that has now been operating for a decade.

New Jersey
NAESCO is monitoring the development of Governor Christie’s first state budget, because rumors are that it will propose deep cuts in the state’s large Clean Energy (ratepayer financed EE) program. NAESCO is also gathering together a group of ESCOs to begin an effort to reform the state’s performance contracting law to facilitate ESPC projects.

Pennsylvania
The utilities will begin large EE programs (called Act 129 programs) with aggressive savings goals in early 2010. The utilities filed their program plans in mid 2009. Hearings on the plans were held during the summer. The Pennsylvania Public Utilities Commission (PAPUC) issued its decisions in mid-October. NAESCO filed comments that urged the PAPUC to address the Act 129 mandate that at least 10% of program savings come from government and non-profit customers by ordering the utilities to use their program funds to supplement and expand the very successful Guaranteed Energy Savings Agreement (GESA) program. The PAPUC rejected this suggestion, as it rejected most of the program suggestions made by various parties, and approved the utility plans without much modification. Rather than establish a separate delivery channel for government customers, the PAPUC decided to accept the utility approach of offering the same incentives to government customers but to differentiate the marketing to those customers. So ESCOs in Pennsylvania will have to piece together the rebates offered for various ECMs, along with the custom rebates, to make the best package for their customers.

North Carolina and South Carolina
Utility regulatory commissions in both states have ordered the states’ major electric utilities – Duke and Progress Energy -- to implement large new energy efficiency programs. Both state commissions have rejected Duke’s program compensation proposal, called Save-a-Watt, as advocated by NAESCO and a coalition of energy and environmental groups. In December, the North Carolina Commission approved a settlement negotiated by the coalition that preserves the innovative aspect of the Save-a-Watt compensation plan (allowing utilities to collect a fraction of the avoided cost of power the EE programs replace) while reducing and capping the compensation at a reasonable level.

Florida
NAESCO continues to monitor the proceedings to update utility energy conservation goals based on current cost-effectiveness standards. The analysis of the potential market for energy efficiency submitted by the utilities does not seem credible. In contrast to the targets that have been set by other states, which typically range from 1-2% incremental savings per year, the Florida utilities are proposing targets of less than 1% cumulative through 2020. NAESCO is working with regional environmental and energy organizations to see how we might assist them in making the case for more aggressive EE programs. The talking point used by the interveners is that the utilities and the PSC staff seem to think that a 2-3% rate increase to fund EE programs is intolerable while a 30% rate increase to fund new nuclear plants is reasonable. In December, the Florida Commission ordered the utilities to resubmit their plans with more aggressive goals.

Georgia
NAESCO is working with ESCOs and energy efficiency organizations to enact legislation and a constitutional amendment to facilitate performance contracting in Georgia. At present, the Georgia state constitution does not permit the state to enter into a standard type of performance contract for state facilities. Legislation that would provide a limited performance contracting capability appeared on track to pass the legislature last year, but was sidetracked on the final day of the legislative session. The legislation is on the docket again this year, and passage is expected. In the meantime, we are working on drafting a constitutional amendment that would permit a standard performance contracting program for state facilities. The amendment would have to pass both houses of the legislature by two-thirds votes and then be approved by the voters at a regular state election. An amendment may be a long shot this year, given the growing concern among voters about government debt at all levels – national state and local.

Louisiana
NAESCO continues to support ESCOs working in Louisiana who are working to resolve the ongoing issues around the monitoring and verification of O&M savings in ESPC contracts. It now appears that there may be another attempt in the legislature to eliminate or severely restrict performance contracting. A similar attempt about five years ago failed because of a coordinated effort by ESCOs assisted by NAESCO. We are working again with ESCOs and their consultants to try to make sure that any new legislation facilitates rather than hinders performance contracting.

Arkansas
The Arkansas Public Service commission is beginning the process of establishing a comprehensive portfolio of utility energy efficiency programs. NAESCO will monitor the proceeding, submit comments and work with energy efficiency and environmental groups to ensure that the new programs offer opportunities for ESCOs and performance contracting.

Illinois
The expanded Illinois utility EE programs started their second year of implementation, with approximately double their first-year budgets, in mid-June. NAESCO is working with the program managers for the Commonwealth Edison program to set up meetings with ESCOs to encourage the development of more comprehensive projects.

Michigan
The electric utilities have filed new energy efficiency program plans. NAESCO is monitoring the development of those plans, and has held a series of meetings with officials of the state Department of Energy, Labor and Economic Growth (DELEG) and the state Department of Management and Budget (DMB) about implementing a major state and local government ESPC program with a major portion of its ARRA funding.

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New Members

NAESCO welcomes the following new members.

Alumen8 – Alumen8 is a design manufacturer of energy efficient, state-of-the-art, fluorescent lighting fixtures and retrofit conversion kits.

Donnelly Sustainable Energy Services - Donnelly Sustainable Energy Services is an independent, energy services and energy consulting company that provides total turnkey energy services to our clients. Donnelly Sustainable Energy Services provides services that include energy master plans, utility bill consulting, LEED consulting, feasibility studies for all types of energy consuming/energy saving equipment, preparation and administration of bid specifications, turnkey installation of all types of energy conservation measures, financial analyses including energy efficient tax strategies, rebate administration, energy service agreements, and project financing options.

Thunderbird Mountain Facilities Performance Services - Thunderbird Mountain Facilities Performance Services is a team of professionals with a combined experience level of 100 years servicing Arizona Facilities, specializing in Educational Facilities.

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Upcoming Events
 

NAESCO's Fifth Annual Federal Market Workshop
March 19, 2010
Pepco Building, 701 Ninth St., NW Washington, D.C. 20068

The fifth annual NAESCO Federal Workshop is a forum for public and private sector representatives to discuss the emerging opportunities in the federal marketplace. President Obama has indentified investment in energy efficiency as one of the key ways to revitalize the U.S. economy and put the country on a path to sustainable prosperity. Through aggressive federal energy mandates, the Obama administration has already started working toward a clean energy future that will create millions of jobs while cutting our imports of foreign oil. These mandates requires all federal buildings to cut their energy use drastically and very quickly these government entities will be looking for cost effective ways to reduce their carbon footprint. This workshop will focus on how the energy efficiency marketplace can leverage these unique opportunities by participating in a dialogue with the public sector concerning the value of ESCO projects, the fastest, cleanest and cheapest way to reduce energy use.

To register, please click here.

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Industry News

New Survey Finds Venture Capitalists Investing In Green Technologies
According to a recent survey by the firm KPMG LLP, venture capitalists may be moving away from investments in businesses that produce electricity with wind or solar power, in favor of companies that specialize in energy storage and conservation. The survey found 67 percent of respondents indicating that they expect venture investment in start-up and growth companies to increase in 2010 from 2009 levels, a drastic shift from a similar survey last year, when 23 percent predicted an increase. The green-tech sector will be particularly attractive to investors this year, according to the survey. 77 percent of respondents said venture investment in green technology will increase in 2010 compared with 2009, including 15 percent who project investment to jump by more than 20 percent. Of the respondents, 38 percent said that the energy storage and efficiency sector will see the most investment, up from 33 percent in the 2009 survey. Meanwhile, 30 percent expect renewable energy to get the most investment money in the next two years, a drop of six percentage points compared with last year’s survey.

KPMG LLP is a global network of professional services firms providing Audit, Tax and Advisory services. The survey, which polled 200 venture capitalists, investors, entrepreneurs, and bankers, will be released at the upcoming “Going Green East” conference in Boston.

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Study Finds Energy Management Systems Market is Still Only 14% Penetrated
A new study released by Pike Research finds that Energy Management Systems (EMS) are being increasingly utilized by commercial building property managers to help optimize energy consumption. According to the report, automation and control capabilities enabled by EMS are most frequently focused on heating, cooling, ventilation, and lighting, which together account for approximately 57% of energy consumed in commercial buildings. However the report finds that despite the strong return on investment for EMS deployments, just 14% of the market potential is being realized.

The study contends that there are ample opportunities for growth as new companies focused on the space emerge, and longstanding IT companies and building management system companies gravitate to this growing market. Pike Research forecasts that all of these factors will help drive the commercial building energy efficiency market to over $6.3 billion by 2020.

Pike Research is a market research and consulting firm that provides in-depth analysis of global clean technology markets. An Executive Summary of the report, entitled “Energy Management Systems for Commercial Buildings” is available for free download on the firm’s website.

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New Report Details Consumer Savings from Energy Efficiency
The Consumer Federation of America recently released a report stating that consumers in all 50 states can save money on home energy bills if strong national energy efficiency policies are enacted. The report found that even if all the costs of investing in energy efficiency fell directly on households, on average, the households would save money in all states, with a low of about $106 saved per year to a high of $460 saved per year. Additionally, the report found that energy efficiency could lead to a 20 to 30 percent reduction in energy use from utilities.

The report concluded that strong federal energy efficiency policies that promote investments in efficient lighting, windows, home heating and cooling systems effectively reduce home electricity and natural gas bill by hundreds of dollars a year in every state. The detailed state-by-state savings show that efficiency can create jobs, reduce energy waste and reduce the overall cost of climate and energy legislation for consumers.

The Consumer Federation of America is an advocacy, research, education and service organization. To download a free copy of this report, entitled “Building on the Success of Energy Efficiency Programs to Ensure an Affordable Energy Future”, click here.

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Obama Budget A Step In The Right Direction For Energy Data
A new report issued by the ACEEE documents current gaps in federal data collection and outlines a path forward beginning with recommendations for appropriators in 2011 fiscal year. All levels of government and many types of businesses rely upon accurate energy efficiency analyses in order to shape policy and outline business growth plans. Dependable analyses are grounded in good energy and market data, much of which has historically been collected by the Energy Information Administration (EIA) and other governmental data agencies. The President’s 2011 budget request provides for a long-overdue increase in funds for the EIA, an independent research agency within the U.S. Department of Energy responsible for collecting information about end-use consumption, energy efficiency programs, and energy resources. This budget increase of $18 million above the previous year’s budget of $110 million represents a good trend towards better data collection but, as the report demonstrates, funding for energy data collection should see sustained increases in the years ahead. Similarly, the report points out the need for expanded funding by other federal data collection entities such as the Census Bureau and the Federal Highway Administration.

Recently, the importance of accurate energy use data has grown due to increased interest in using energy efficiency policies to promote job creation using funding from the American Recovery and Reinvestment Act of 2009 and potential funding in pending jobs and climate legislation. In order to accurately quantify the energy and financial impacts of these policies, reliable metrics must be employed, and these require good data.

The full report, “Where Has All the Data Gone?” is available for free download here.

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Report Supports Expansion of Mechanical Insulation
The National Insulation Association released a report promoting the implementation of a comprehensive mechanical insulation and upgrade program in the commercial and industrial market segments. Based on more than 700 industrial energy assessments, the report contends that the implementation of such a program would result in $4.8 billion in energy savings, 43 million metrics tons of GHG emissions and the generation of 89,000 jobs.

According to the report, insulating 45 linear feet of 8 inch insulation equates to $13,600 per year in energy savings. If the facility lasts for more than 20 years, the total energy savings would be $272,000. The report contends that this work can be completed by one worker within a single day. These savings are equivalent to removing 12 card per year from the highway.

The National Insulation Association (NIA) is a trade association representing the mechanical and specialty insulation industry. You can access the report, “Mechanical Insulation Maintenance and Upgrade: Annual Impact”, here.

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EIA Energy Outlook Projects Reduced Oil and Natural Gas Imports
The U.S. Energy Information Administration (EIA) recently released their “Annual Outlook” which presents updated projections for U.S. energy consumption and production through 2035. Among the report’s findings was that there will be moderate energy consumption growth and greater use of renewables. This means that the total primary energy consumption will grow by 14 percent between 2008 and 2035, as the fossil fuel share of total U.S. energy consumption falls from 84 percent to 78 percent. The report predicted that total U.S. consumption of liquid fuels, including both fossil liquids and biofuels, grows from 19 million barrels per day in 2008 to 22 million barrels per day in 2035. Biofuels account for all of the growth, as consumption of petroleum-based liquids is essentially flat. As a result, reliance on imported oil declines significantly over the next 25 years.

Additional report findings contend that total electricity consumption, including both purchases from electric power producers and on-site generation, grows by 1 percent per year over the projection period, from 3,873 billion kilowatthours in 2008 to 5,021 billion kilowatthours in 2035. Natural gas and renewable power plants account for the majority of electricity generating capacity additions. The natural gas share falls slightly due to the completion of coal plants under construction, and the addition of new renewable capacity. However, by 2035 the share of generation from natural gas again increases to 21 percent. Renewable generation shows the strongest growth between now and 2035, spurred by incentive programs in more than half the States. The renewable share of generation grows from 9 percent of generation in 2008 to 17 percent of generation in 2035.

The report concludes that existing policies that stress energy efficiency and alternative fuels, together with higher energy prices, will curb energy consumption growth and shift the energy mix toward renewable fuels. However, assuming no new policies, fossil fuels would still provide about 78 percent of all the energy used in 2035.

The Energy Information Administration provides policy-neutral data, forecasts, and analyses to promote sound policy making, efficient markets, and public understanding regarding energy and its interaction with the economy and the environment. To access the early release of the report, click here.

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Study Says Undersea Release of Methane Is Under Way
Researchers at the University of Alaska, Fairbanks released a study contending that global warming is unlocking vast stores of the greenhouse gas methane that are frozen into the Arctic permafrost, setting off potentially significant increases in global warming. According to the report, this change is under way in the East Siberian Arctic Shelf, west of the Bering Strait.

The report states that atmospheric concentrations of methane have more than doubled since pre-industrial times. Most of it comes from human activities including energy production, cattle raising and the cultivation of rice. But about 40 percent is natural, including the decomposition of organic materials in wetlands and frozen wetlands like permafrost. Peat land that flooded as sea levels rose after the last ice age, is degrading in part because runoff from rivers that feed the Arctic Ocean is warmer than in the past. The report estimates that annual methane emissions from the East Siberian Arctic Shelf total about 1.1 million tons. According to the report, sea methane ordinarily undergoes oxidation as it rises to the surface, where it is released as carbon dioxide. But because water over the shelf is at most about 50 meters deep, the gas bubbles to the surface there as methane. As a result, atmospheric levels of methane over the Arctic are 1.85 parts per million, almost three times as high as the global average of 0.6 or 0.7 parts per million. Concentrations over the shelf are 2 parts per million or higher.

The study, entitled “Arctic Seabed Methane Stores Destabilizing, Venting” was produced by the International Arctic Research Center (IARC) at the University of Alaska Fairbanks. The center was established as a cooperative research institute supported by both the U.S. and Japanese governments. To download a free copy of the study, click here.

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Department of Energy Launches Website Highlighting Efficiency Projects
The U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy has launched a new website to promote the widespread benefits of energy efficiency. Called Energy Empowers, this compellation of human interest stories and project summaries shows how federal, state and local governments are putting the Recovery Act's clean energy funds to work. Energy Empowers highlights stories from the clean energy economy. This blog and multimedia site seeks to put a human face to the people, places, technologies and developments that will impact our energy future and economy, showing everyone that these advancements are real, growing and becoming part of our communities around the United States. The DOE is encouraging everyone working in the energy space to visit and share their own success stories. These stories can include DOE and ARRA projects, as well as stories about communities, private citizens and businesses taking the initiative in building America towards a clean energy future.

To submit your own story, click here.

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Hospital Study Puts Price Tag on California's Pollution
A new study released by Rand Corp attempts to put a price tag on the state's polluted air. According to the study, California's air pollution led to nearly $200 million in hospital spending over a three-year period because of asthma, pneumonia and other pollution-triggered ailments. The study focused on pollution from ozone, most commonly derived from automobile tailpipe emissions, and fine particulate matter, such as soot from fireplaces and wood-burning stoves. The study analyzed records from hospitals and air quality agencies from 2005 to 2007. As many as 30,000 people statewide sought relief in emergency rooms because of air pollution during that period, the report states.

Rand researchers say their study for the first time breaks down who paid the bills. Medicare and Medi-Cal paid two-thirds of the costs associated with poor air quality, according to the study. Commercial insurers and other private sources footed the rest of the bill. Among private insurers, Kaiser Foundation Health Plans accounted for $30 million of the $193 million spent during the three-year study period. More than two-fifths of the expenses were concentrated in Los Angeles County, with the rest mostly concentrated along the state's inner valleys, from Kern to Sacramento counties, where illness-causing particulates are more likely to linger. The report contends that hospital costs are just a fraction of the hundreds of millions of dollars spent each year on pollution-related medical care.

The RAND Corporation is a non-profit think tank helping to improve policy and decision making through objective research and analysis. The study, The Impact of Air Quality on Hospital Spending, can be downloaded for free here.

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Member Projects

Ameresco Awarded Portsmouth Naval Shipyard Contract
Ameresco was awarded a contract to implement two energy conservation measures at Portsmouth Naval Shipyard under the Department of Energy’s Mid-Atlantic Region Super Energy Savings Performance Contract. The ECMs consist of compressed air system retrofits including two new air compressors and controls optimization, and condensate system repairs including condensate piping and pump stations. The project will save $8.5 million in energy and utility costs.

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Ameresco to Implement Energy Efficiency Upgrades at the National Archives
Ameresco was awarded the contract to implement energy conservation measures at the National Archives and Records Administration (NARA) Archives I flagship facility. This is Ameresco’s first project awarded under the new DOE ESPC contract. The ECMs include cogeneration, new high-efficiency boilers, water conservation measures, direct digital controls (DDC) optimization, high efficiency lighting and controls, and building envelope improvements. The project will save over $6.9 million in energy and utility costs.

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Ameresco Awarded Contract by Department of Energy
Ameresco was awarded a contract to implement five energy conservation measures at FCI Jesup under the Department of Energy’s Southeast Region Super Energy Savings Performance Contract. ECMs include lighting system improvements, water and wastewater conservation, site wide utility metering, HVAC system improvements, controls system improvements, heating system improvements, and process improvements. Additionally, the renewable energy ECM provides for the installation of a biomass-fired heating system to produce steam for the Institution’s heating, domestic hot water, and process loads using the existing steam distribution system. The project will save over $27.7 million in energy and utility costs.

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Constellation Energy Project Named Best In New England by Association of Energy Engineers
Constellation Energy’s recently completed retrofit of Bristol Community College was named “Best in New England” by the Association of Energy Engineers. Efficiency upgrades included retrofit lighting and lighting controls, energy efficient motors, EMS upgrades, water conservation measures, Vending Machine Controls, Window Film, Boiler Improvements, Power Factor Correction and Photovoltaics. The project is projected is expected to save the college $441,791 annually.

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Johnson Controls Helps Rome, NY Improve Energy Efficiency with Upgrades Citywide
The city of Rome, N.Y., selected Johnson Controls to provide energy efficient upgrades to multiple facilities throughout the city, including the installation of a state-of-the-art aeration system at its wastewater treatment plant. The improvements are part of a 15-year performance contract with Johnson Controls, which is expected to save the city more than $8.5 million in energy costs. The city has already realized more than $246,000 in savings during the construction period, which was completed in October 2009. The energy program upgrades include the installation of an energy efficient diffused aeration system at the wastewater treatment plant, replacing a 30-year-old mechanical system that was inefficient in handling increased demand for waste treatment. Additional improvements include the installation of variable speed drives on low-lift pumps at the Water Filtration Plant, advanced data tracking management tools and lighting retrofits, designed to improve overall energy efficiency while saving taxpayer dollars.

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Honeywell Completes Stimulus Backed Solar Project for the City of Wilmington
Honeywell announced it has installed the first of two solar photovoltaic arrays for the city of Wilmington, Del. The solar installations, which will consist of almost 3,400 panels, are part of a broader $14.5-million energy retrofit and renewable energy program that will decrease utility costs and greenhouse gas emissions tied to city-owned facilities and infrastructure. The energy improvements will reduce electricity consumption by an estimated 2.8-million kilowatt-hours per year. The program will also decrease carbon dioxide emissions by nearly 4.4-million pounds each year. The city will pay for the entire program from the energy savings the upgrades produce. Honeywell guarantees approximately $1.14 million in savings per year under a 20-year performance contract.

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NORESCO to Implement $34 Million in Energy Upgrades on Capitol Hill
The Office of the Architect of the Capitol awarded an energy savings performance contract to NORESCO for work in the office buildings of the U.S. House of Representatives. The project includes $34 million in facility infrastructure upgrades in the Rayburn, Longworth, Cannon, and Ford House Office Buildings, and the House Page Dormitory. The infrastructure upgrades will pay for themselves through more than $67 million in reduced energy and water consumption costs over the project term. After completion of construction, the House Office Buildings are expected to reduce energy consumption by 23 percent and total water consumption by 32 percent.

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Atlantic Cape Signs Agreement With Pepco Energy Services For Solar Photovoltaic Project
Atlantic Cape Community College will enter into a Power Purchase Agreement with Pepco Energy Services, Inc., for a solar photovoltaic power project at the college's Mays Landing and Cape May County campuses. Pepco Energy will design, own and operate one of the largest land-based solar systems in New Jersey. If completed today, the installation would rank as the largest single community college solar installation in the nation. Atlantic Cape chose Pepco Energy Services to develop a 2.3 megawatt solar electric generating system for its campuses. The solar photovoltaic system will generate up to 48 percent of Atlantic Cape's total annual electric consumption, at a set rate, independent of market rates. By entering into the agreement, Atlantic Cape will realize savings of $220,000 the first year and up to $6.8 million over the 20-year life of the contract. The electricity generated per year will be equivalent to the amount needed to power approximately 220 homes.

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Department of Energy Awards Contract to SAIC
Science Applications International Corporation (SAIC) announced it has been awarded a prime, follow-on contract by the Department of Energy to provide technical, managerial and project support services to the U.S. Energy Information Administration (EIA). The multiple award, indefinite-delivery/indefinite-quantity contract has a five year base period of performance and a contract ceiling of $288 million for the three awardees. Under the contract, SAIC will continue to support the EIA in areas including energy analysis and econometric modeling; statistical analysis; survey operations; and web and data system/software design and development. SAIC may provide deliverables including issue and trend analyses, energy and climate change technology surveys, facilities capital and operation and maintenance cost assessments, and historical trends analysis, as well as web and data system prototypes. SAIC will also help EIA develop, manage, operate, and maintain comprehensive energy data collection programs and systems; and maintain domestic and international energy models for forecasting as required.

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Schneider Electric Implements Energy Efficiency Upgrades at Kansas School District
Hoisington Unified School District 431 in Hoisington, Kansas, is completing $1.39 million in facility enhancements designed to improve operations, comfort and efficiency at the district's six facilities. Schneider Electric will complete the work as a performance contract with the district. Schneider Electric guarantees that USD 431 will reduce its utility costs by almost $68,000 annually once the implementation of the improvements is completed. Schneider Electric will replace antiquated lighting systems with new energy-efficient lamps and ballasts that also provide improved illumination. Existing building controls will be re-commissioned and a new BMS will be installed where there is none. The new, unified system will provide consistent control throughout the district for improved efficiency and comfort. Mechanical equipment replacements include new rooftop equipment at two of the buildings, as well as electrical system upgrades at one of the elementary schools.

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Omak School District Awards ESPC to Schneider Electric
The Omak School District in Omak, Wash., is implementing an energy saving performance contract with Schneider Electric. The $600,000 project, funded with a combination of district capital, utility incentives and reallocated savings, will reduce the district's energy costs by 15 percent. Schneider Electric anticipates completing the project by April of 2010. Schneider Electric estimates that the Omak School District will reduce its carbon emissions by 136 tons annually when the performance contract is completed. This is equivalent to planting 5,458 trees, removing 29 cars from the roads, or making 18 households carbon neutral.

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Trane Implementing Infrastructure Upgrades In Clayton County Expected to Save Nearly $575,000 Annually
Clayton County in conjunction with Trane will soon undertake infrastructure upgrades to its buildings anticipated to improve its annual budget by nearly $575,000. The county expects the renovations to save $361,000 in annual utility costs and to generate $213,000 in annual carbon credit revenues. The upgrades are scheduled for seven county facilities and the county landfill. The $5.5 million in renovations will include replacing or redesigning heating, ventilation and air conditioning systems to increase temperature control, reduce energy consumption and decrease operating costs at the Department of Family and Children Services complex, Annex III, the County Archives building, the justice complex and the Clayton Center behavioral health buildings.

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Eastern Aroostook Regional School Unit 39 Partners with Trane and Launches Energy Upgrades
Administrators at the newly formed Eastern Aroostook Regional School Unit 3939along with Trane are poised to launch $2.8 million in energy-saving infrastructure upgrades expected to save more than $250,000 annually, improve the learning and teaching environment and reduce dependence on oil as an energy source. The district also expects to save more than 84,000 KWh of energy and 71,000 gallons of fuel by completing the improvements at the Caribou High School and Caribou Technology Center. Scheduled for completion in October 2010, the upgrades will reduce energy costs, replace aging equipment and improve indoor air quality. The majority of the savings for the project will be driven by a new biomass boiler plant, which depends on low-cost wood chips instead of fuel oil.

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Member News

For a full list of all NAESCO Member News and Projects, please click here.

Almeco Group Together With The Atlanta Based International Facility Announce The Formation of ALMECO USA, Inc.
Located in Atlanta, GA, ALMECO USA can now provide customers with immediate access to the full VEGA 95% & VEGA 98% product lines as well as a variety of Enhanced, Standard, Semi-Specular and 92% High Reflective White painted Aluminum for energy savings technologies. In addition to the broadest range of lighting & architectural aluminum products, ALMECO USA will represent Almeco-Tinox Gmbh, carrying Tinox Energy & Vega Energy products for the Solar industry.

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Comfort Systems USA Energy Services Receives Qualifications for the Department of Energy’s Qualified List of Energy Service Companies and GSA Schedule
Comfort Systems USA Energy Services has received qualification for the United States Department of Energy’s Qualified List of Energy Services companies. The company has also been awarded a General Services Administration (GSA) contract number and inclusion on GSA’s schedule 03FAC Facilities Maintenance and Management. Government agencies can now use the GSA Advantage online ordering and shopping website to take advantage of Comfort Systems USA Energy Services’ energy efficiency solutions including energy audits, building commissioning, energy program support services, and energy management planning and strategies.

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State-of-the-Art Emissions Scrubbers at Constellation Energy's Brandon Shores Power Plant Commence Commercial Operation
Constellation Energy announced that its flue gas desulfurization or "scrubber" project at its Brandon Shores Power Plant in Anne Arundel County, Md., has begun commercial operation, making Brandon Shores one of the cleanest-burning power plants of its kind in the nation. This nearly $1 billion investment is one component of a clean air program which will ensure Constellation Energy's coal-fired power plants will meet all emissions requirements of the Maryland's Healthy Air Act, which was signed into law in 2006. Constellation Energy's investment in this environmental upgrade will reduce the coal-fired power plant's sulfur dioxide (SO2) emissions by an estimated 95 percent and existing mercury emissions by 90 percent.

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FMI Capital Advisors Advises Cogent Energy, Inc in Its Sale to EnerNOC
FMI Capital Advisors announced it has advised Cogent Energy, Inc. of Concord, CA, on its sale to EnerNOC. Cogent Energy is a monitoring-based commissioning energy consulting, and energy engineering firm delivering comprehensive energy efficiency and on-site generation solutions to government, educational, institutional and private facilities owners.

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Justin Testa Joins Onset as New President
Onset announced that Justin Testa has been hired as the company’s new president. Most recently, Mr. Testa served as the executive vice president and business unit manager for Cognex Corporation, where he was responsible for the development and execution of a business strategy designed to accelerate the company's growth and market position of its core machine vision business with revenue exceeding $100 million.

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