Item 5 - Authorization to Enter Into Agreement with Southland Industries and SDGE ~ ~EPORT SUMMARY -
TO: Honorable M~yor and Members of the City Council
FROM: James L. Bowersox, City Mana~f'~}~J~ .~ ~
_NITIATED BY: John D. Fitch, Assistant City Manager~/~ ,
James R. Williams, Director of Public So. vices t~
Douglas R. Hilliker, Water Utilities Manager
DATE: April 25, 1995
SUBJECT: Authorization to Enter into an Agreement with Southland Industries and San Diego
Gas and Electric to Reduce Energy Consumption
In order to conserve energy at City facilities, staff determined that it would be cost and energy effective to
upgrade and/or replace existing heating, ventilating, and air conditioning equipment.
It is recommended the City Council authorize staff to enter into agreements with Southland Industries and
SDG&E.
ENVIRONMENTAL REVIEW
This item is not subject to CEQA review.
This project will generate an estimated positive cash flow of $90,584 in the first year, which includes a
$53,000 energy incentive from San Diego Gas and Electric. The ten year positive cash flow'is estimated to
be $658,567. The energy savings calculated ($76,079) represents 15.2% of the entire SDG&E cost. This is
a conservative savings projection.
ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE
Notification was published in the £oway News Chieftian on April 13, 1995 and a copy has been mailed to
Mr. Tom Patemo, Southland Industries and Mr. Phil Ondler, SDG&E.
RECOMMENDATION
It is recommended that the City Council authorize staff to enter into agreements with Southland Industries
and SDG&E and authorize the City Manager to execute said agreements subject to the approval of the City
Attorney.
ACTION
of 3 APR 2 5 1B~5 ~l'l:M 5
AGENDA.. REPORT
CITY OF POWAY
TO: Honorable Mayor and Members of the City Council
L. Bowersox, City Man~
FROM:
James
Fitch, Assistant City Manager ~o~
INITIATED BY: JohnjamesD.R. Williams, Director of Public Services ~
Douglas R. Hilliker, Water Utilities Manager
DATE: April 25, 1995
SUBJECT: Authorization to Enter into an Agreement with Southland Industries and
San Diego Gas & Electric to Reduce Energy Consumption
BACKGROUND
In 1994, the City of Poway interviewed three energy conservation firms for the purpose of evaluating
a means in which the City of Poway could save energy. It was determined that the City of Poway
would benefit to upgrade and/or replace equipment to make it operate in a more efficient and cost
effective manner. Equipment would include: heating, ventilating, and air conditioning (HVAC)
equipment, lighting, irrigation equipment, and mechanical systems at City facilities. By making
the equipment modifications or enhancements, the cost of the improvements are paid for from the
savings realized by reduced costs of operation, utility company rebates, and energy savings. The
program is designed to be self-funding and does not require any up-~ont capital expenditures. Staff
established guidelines in the scope of work that would maximize savings benefits to the City.
FINDINGS
Each of the three firms performed an in-depth analysis of the projected cost and energy savings to
the City.
San Diego Gas and Electric Company, Honeywell, and Southland Industries each submitted a
proposal, including references, for staffs consideration. Based upon the qualifications of each of
the proposals received, staff determined Southland Industries to be the firm best suited to meet the
current energy management needs for the City of Poway.
ACTION:
2 of 3 APR 25 1995 ITEM 5 ,'
Authorization to Enter into Enerev Aereements
April 25, 1995
Page 2
The resultant annual energy and operational savings guaranteed by the contractor, will exceed the
annual cost for financing the installed equipment. The proposed contract will include the
replacement of City HVAC equipment and maintenance, warranty service, and training 6n all other
equipment installed. The contract agreement will conform to Government Code Section 4217.12.
As part of this project, SDG&E will compensate the City for energy conservation measures
implemented as an added financial incentive; staff further recommends the City enter into an
energy conservation rebate agreement with SDG&E for the capital portion of the project.
ENVIRONMENTAL REVIEW
This project is Categorically Exempt under Section 15301 of the CEQA guidelines..
This project will generate an estimated positive cash flow of $90,584 in the fast year, which includes
a $53,000 energy incentive from San Diego Gas and Electric. The ten year positive cash flow is
estimated to be $658,567. The energy savings calculated ($76,079) represents 15.2% of the entire
- SDG&E cost. This is a conservative savings projection.
ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENT
Pursuant to Government Code Section 4217, notification was published in the Poway News
Chieftain on April 13, 1995. A copy of this report was mailed to Mr. Tom Patemo, Southland
Industries and Mr. Phil Ondler, SDG&E.
RECOMMENDATION
It is recommended that the City Council take the following actions:
1. Authorize staff to enter into a performance contract with Southland Industries, and authorize
the City Manager to execute said agreement subject to the approval of the City Attorney; and
2. Authorize staff to enter into an energy conservation rebate agreement with SDG&E, and
authorize the City Manager to execute said agreement subject to the approval of the City
Attorney.
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APR 2 5 1995 ITEM .5 '
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