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CC - (1) Acceptance of Work Performed by Setpoint Systems Corporation in the amount of $624,468; (2) Authorization to File a Notice of Completion; and (3) Authorization to Release the Retention Payment after Expiration of the 35-Day Lien Period, for the City Facilities Energy Efficiency Project, PF-004.
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Contact Person/Dept: Joe Susca, Public Works
Phone Number: (310) 253-5636
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [] Attachments: Yes [] No [X]
Commission Action Required: Yes [] No [X]
Public Notification: (E-Mail) Meetings and Agendas - City Council (08/02/2016); The Energy Coalition (07/20/2016); Setpoint Systems Corporation (07/20/2016).
Department Approval: Charles D. Herbertson (07/28/2016)
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RECOMMENDATION
Staff recommends the City Council: (1) accept work performed by Setpoint Systems Corporation in the amount of $624,468; (2) authorize filing a Notice of Completion; and (3) authorize release of the 5% retention payment amounting to $31,223.35 after expiration of the 35-day lien period, for the City Facilities Energy Efficiency Project, CIP PF-004.
BACKGROUND:
Over the past few years, the City has been working with The Energy Network (TEN) to implement turn-key energy efficient projects citywide. TEN, administered by Los Angeles County, was created by the California Public Utilities Commission to help public agencies in Southern California implement projects that save energy and reduce operating costs.
In 2014, TEN conducted a thorough energy audit at the City’s highest energy using facilities. The audit focused on the lighting and mechanical components and after reviewing the audit, staff recommended implementation of a bundled turn-key project at City Hall, the Police Station, Transportation, the Senior Center and Veterans Memorial Complex that retrofits the lighting and heating, ventilation and Aar conditioning (HVAC) mechanical components along with implementation of a new Energy Management System to control these components to optimize their efficiency (the “Project”). The Project provides substantial energy savings benefits, operating cost reductions with the cost of the project offset to some degree by incentives and zero interest loans received from utility companies. The Project also advances the City’s position as a community leader in environmental sustainability. Through Southern California Edison’s Energy Leadership Partnership program, the City has been awarded “Gold” status in recognition of its successful implementation of this and various other energy saving projects.
On January 26, 2015, the City Council unanimously approved agreements totaling $1,163,342.34 to complete the Project with ACCO Engineered Solutions (ACCO, $183,643.79 for HVAC improvements), Express Energy Systems, Inc. (Express, $404,095.55 for lighting improvements) and Setpoint Systems Corporation (Setpoint, $575,603.00 for an Energy Management System). ACCO and Express completed their portions of the Project in 2015.
DISCUSSION:
Setpoint completed the design, programming, installation and training for the City’s new Energy Management System within budget and the entire Project is now complete.
FISCAL ANALYSIS:
The City’s cost to complete the Project is offset by Southern California Edison (SCE) and Southern California Gas (SCG) incentives and rebates amounting to $141,013. The City’s capital contribution to complete the Project is $1,049,829.34 ($1,190,842.34 - $141,013 in incentives/rebates). The City will save approximately $1,769,480 from reduced energy use for a net savings of $719,650.66 over the Project’s 12-year life.
Sufficient funds exist in CIP PF-004 - City Facilities Energy Efficiency Project to cover the $624,468 cost to complete Setpoint’s portion of the Project, including the $31,223.40 retention amount.
Now that the Project has been completed, staff has submitted Installation Reports to SCG/SCE who, in turn, have or will remit checks to the City in the amount of $907,282.41 ($766,269.41 in loans and $141,013 in incentives/rebates). These zero percent interest loans from SCE/SCG will be paid back by the energy savings the Project achieves through their On-Bill Financing Program with an average loan payback of 8.4 years.
RECOMMENDED MOTIONS:
That the City Council:
1. Accept the work performed by Setpoint Systems Corporation in the amount of $624,468; and
2. Authorize filing a Notice of Completion; and
3. Authorize release of the 5% retention payment in the amount of $31,223.35 to Setpoint Systems Corporation upon expiration of the 35-Day lien period.