Council Passes Resolution for Energy Savings Improvement Program

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Article was written by Matt Kavanagh, Parsippany Green Team

PARSIPPANY — Energy efficiency and renewable energy present a fantastic way for public entities to save money and tax dollars while reducing their carbon footprint thus demonstrating a commitment to environmental and fiscal stewardship for its citizens.

In keeping with Parsippany’s long history of environmental leadership, on Tuesday, September 15 the Township Council voted on taking the next step with its Energy Savings Improvement Program (ESIP) to pass a resolution on an aggregated project for 13 municipal buildings.  The resolution will allow the opening of a request for proposal (RFP) soliciting bids on an Energy Savings Plan (ESP) for the municipal building portfolio.  This is a program that will save Parsippany thousands of dollars by accessing an NJ state funding mechanism that enables retrofitting facilities with energy conservation measures (ECMs) without new capital investment.

An ESIP is an important step for the town to access funds and kick start a plan to reduce the energy demand on these buildings, save costs, and minimize the combined environmental impact of the facilities.  NJ towns such as Denville, Marlboro, Montville, Pittsgrove, and many others have completed these programs and saved millions over the life of their respective ESIPs.  Additionally, this is an action initiated by the municipal and citizen Parsippany Green Team in the pursuit of Gold Certification in Energy through the Sustainable Jersey program and in support of NJ’s Energy Master Plan for greenhouse gas reduction.

Approved into NJ law in 2009, an ESIP is a financing mechanism using refunding bonds or lease-purchase agreements without upfront capital to integrate ECMs saving on energy costs, upgrading building infrastructure, and reducing consumption.  For the ESIP, the utility costs savings from upgrades offset the upfront costs of the projects whereby savings are stretched over the 15-20 year service life of the equipment.  By law and from year one, the ESIP in aggregate must be cash flow positive every year of the program reducing the utility expenses to the town.  In addition to energy savings, state and federal incentives and funding will be integrated into the plan to supplement further improving economics.

The request for proposal is first approved by the NJ Board of Public Utilities before the public RFP is circulated to NJ approved Energy Services Companies (ESCOs) listed under the Division of Property Management and Construction. This is the second step in the ESIP process after the town completed free Local Government Energy Audits (LGEAs) through the NJ Clean Energy Program on all the buildings following tracking and analysis of the utility energy consumption profiles in the summer of 2019.

The RFP will kick off a lengthy process to review and select an ESCO to design a comprehensive Energy Savings Plan after extensive investment grade audits are completed on each building.  Qualifying energy conservation measures encompass a broad range of improvements that result in lower energy consumption including energy efficiency enhancements, water conservation, integrated renewable energy systems, building envelope improvements, and accompanying control systems.  Prior to municipal adoption of an ESIP it must be approved by the Board of Public Utilities and verified by a third-party and the town has an option to purchase energy savings guarantee from the ESCOs further strengthening the investment.

Access the NJ state website for more information by clicking here.