Bringing Stakeholders to the Table

When developing a climate action plan, or when embarking on any community or organizational planning process, engaging stakeholders in a meaningful way ensures that the most relevant groups and individuals are aware and supportive of your process. When done correctly, stakeholder engagement processes may reveal new opportunities for implementing impactful strategies, programs, and projects.

Use the questions below to guide the development of your stakeholder engagement plan and determine the best tools and tactics for stakeholder engagement. Throughout the process of answering these questions, keep in mind what the end result of your project will be—Are you developing a public-facing document that will guide future community planning? Are you developing internal guidelines that will help define employee policy over the coming years? Do you need stakeholder accountability for successful implementation? Knowing where you are going helps to determine the most direct and productive path to get there.

1) Why are you engaging your stakeholders?

What is the goal of stakeholder engagement? If you are developing a public-facing plan, you may want to ensure that your stakeholder engagement includes opportunities for public comment or feedback on draft plans or provides transparency into the planning process. You may want to use the stakeholder engagement process to update your organization’s leadership team on planning progress and ensure that they are able to support the elements and strategies included in the plan. Additionally, you may want to learn from stakeholders that are experts in certain sectors in order to guide the development of strategies and goals within the plan itself. Ultimately, the stakeholder process should ensure that your plan and the goals, strategies, and actions within it remain relevant to your organization or community and can be supported by your employees, leadership, partners, and the general public.

2) Who do you need to engage?

Once you are clear on what exactly it is that you want to gain from your stakeholders, you can now determine who those stakeholders are and what they each bring to the table in support of the overall planning process. Often, making a list of the key stakeholders that come to mind can be helpful; from there, you can look to a few key questions to help ensure that the list includes all the relevant players. As you develop the list of individuals and organizations whose input and feedback are crucial, ask yourself:

• Who will be impacted by our plan?

• What are the interests, values, and priorities of those impacted?

• Are there people or organizations indirectly affected by the plan that should be involved?

• What organizations and individuals are crucial to making sure the work and strategies in the plan are actually implemented?

• What organizations and individuals could hinder success if they aren’t supportive?

These questions may help you identify the individuals and organizations that are most important to involve in the development and roll-out of your climate action plan. You may notice certain trends or groupings that are logical within this list of stakeholders, and you may decide it is necessary to engage these groups differently.  

3) How should you engage your stakeholders?

Once you have identified the stakeholders that are important to include in your planning process and understand the resources available for stakeholder engagement, you can determine the most effective and impactful ways to engage each stakeholder group. Be sure to share stakeholder expectations and allow plenty of opportunity for stakeholder contribution; this ensures that continued dialogue occurs and your stakeholders remain engaged through the entire process.

Working with stakeholders can generally take either an engagement, informative, or communicative format. Stakeholders that you wish to engage are those that are crucial to the process of developing your plan, either because they are in a position to ensure the plan is supported or they may be involved in the actual work of the plan. Stakeholders that you wish to inform are those that you seek to provide information to, but you may not necessarily need information from in order to develop your plan. Stakeholders with whom you wish to communicate are those with whom it is useful to have a two-way dialogue, but whose feedback is not necessarily crucial to the plan’s success.

For each stakeholder group the first step is to define the strategic objectives and understand the resources available for facilitating dialogue, then make a plan of action that achieves the objectives within any applicable resource constraints. For example, perhaps there is a group of local experts working in the transportation field that may be able to identify opportunities to implement changes to the regional transportation system—they should be engaged in the process in order to share opportunities to support the goals within their work.  It may be relevant to complete research on each of the stakeholders’ organizations to focus the discussion and manage any cultural or organizational dynamics that may come up. At the time of the meeting, stakeholders are provided with an overview of why they have been asked to share their input, and then given plenty of opportunity for discussion and dialogue. For larger groups, breaking up into smaller teams gives more people an opportunity to offer ideas and insight. Before ending the meeting, review all of the ideas presented and give the stakeholders a chance to vote on which ideas they think are best, which their organization can support, and which they are skeptical of. If stakeholder action will be crucial to the implementation of the plan, establish a system of accountability and action steps that need to occur.

At other times, an informative approach may be more appropriate—this may be the case when presenting the planning process to the public in order to provide transparency into the development of a climate action plan. In such a case, a public meeting, community event, or open house may be an appropriate forum. Alternatively, it may be necessary to communicate the plan to the public and gather feedback on which elements of the plan they are most interested in seeing accomplished first; in this case, a community survey will allow members of the public to share their thoughts.

A planning process that does not consider the values, goals, and current opportunities and challenges within a broader community or organization is unlikely to yield the same results as a plan that has incorporated the feedback and ideas from a wide and relevant network of stakeholders. Our clients that embark on an inclusive and well-thought out stakeholder engagement process note that the strategies and targets within their plan are more likely to be successful precisely because they are supported by the broader community, whom take responsibility for ensuring that the goals are met.  

If you would like to learn more about how to engage your stakeholders, please contact us.

100% Renewable Commitments, Part 2: Key Strategies for Success

In our last blog post, we discussed the growing trend towards communities committing to 100% renewable energy, and why this is becoming a common climate action strategy. In this post we will discuss the key strategies that will allow communities that have made this commitment to see success.

The Roadmap to 100%

The strategies and steps that communities and businesses can take to commit to 100% renewable energy will inevitably vary by the geographic area, policy and regulatory environment, and flexibility in approach. There are, however, a set of established steps that are recommended to consider when starting towards this ambitious goal:

• Don’t forget about efficiency

Alongside pursuing renewable energy, it is recommended to reduce actual energy consumption as much as possible. For local communities, this may look like energy audits and retrofits in publicly-owned facilities, as well as loan and grant programs that encourage private building and home owners to make upgrades and retrofits. The impact that building codes have on efficiency should not be overlooked—where possible, setting prescriptive building standards and/or “beyond code requirements” that require new buildings, or buildings with major upgrades, to be built to a certain level of efficiency will ensure that as the community grows, its energy consumption may grow at a slower rate. While at times the upfront cost to implement energy efficiency projects can be very high, having a lean and efficient building portfolio will require less renewable energy overall to offset the energy usage. Supporting energy efficiency measures also provides secondary benefits to both communities and individual building and home owners, such as lower energy costs in the long-term. It should be noted, however, that renewable energy projects tend to have a quicker impact on emissions and climate action strategies than energy efficiency programs, which tend to take longer to implement and result in significant change.

• Begin small generation projects, and grow these over time

Communities and companies that own many physical assets, such as buildings, landfills, and parks, may have the opportunity to make productive use of these assets via roof-top and ground-mounted solar, small-scale wind, and geothermal systems. These projects may generate enough energy to offset electricity consumption for publicly-owned facilities and municipal activities. Over time, as more energy uses are transitioned to electricity (see below), these assets can expand to allow for additional power generation. However, it should be noted that though this piecemeal approach may be more politically palatable and easier to implement, small-scale renewable energy projects are generally more expensive (over the long-term) to implement than larger, utility-scale renewable energy projects.

• Transition away from non-electric fuel uses

Once the grid begins to be powered by more renewable energy, its potential to impact emissions from traditionally non-electric sources in the stationary and mobile sectors grows. By electrifying energy-consumption sectors that traditionally are not powered by electricity, we allow for the possibility that these sectors can be powered by renewable energy. Many communities that are striving towards 100% renewable energy in all sectors are considering the importance of electrifying the heating of buildings, encouraging or mandating a switch to all-electric vehicles in city fleets and for the public, and of switching other equipment as necessary to electricity. As the mix of fuels, and therefore the emissions levels, that power grids across the country can vary widely, this strategy is most effective at reducing emissions and advancing a community’s climate action strategy when they have access to a greener grid that is powered by renewable and low-carbon resources.

• Communicate and collaborate

The importance of collaborating with the local utility and wholesale power providers, with local businesses and companies that have a renewable generation goal, and with non-profit organizations that are focused on bringing renewables to market, cannot be overlooked. By engaging a variety of stakeholders in the discussion, opportunities may be presented that previously were not feasible—perhaps a closed landfill can be an ideal site for a community solar array, or a partnership with a local university and renewable generation company can allow for technological research and development while providing power to a community.

Achieving 100% renewable energy is a noble and challenging goal, and the specific approach for each community will look different. If your community or business is interested in going 100% renewable for electricity or all energy sectors, please reach out to us, as we would be happy to help you develop a plan that is tailored to be effective for your unique community and goals

100% Renewable commitments are becoming a common climate action strategy

Across the country, communities and businesses are signaling their commitment to climate action and a cleaner future by pledging to becoming 100% renewable. While their motivations are diverse, and the methods to achieving 100% renewable energy vary widely, the number of pledges continue to grow, and the effect that this will have on long-term climate impacts and emissions inventories is significant. A few of Lotus’ clients have committed or are considering committing to 100% renewable energy and this has inspired us to share some of what we have learned.

We would like to offer the following information and points of consideration for those communities and organizations that are interested in taking on this impressive commitment. This blog will be posted in two parts, where the first will provide an overview of what a 100% renewable goal means. The second post will detail what a roadmap to 100% renewable energy could look like and how your community can succeed in going 100% renewable.

What does ‘100% Renewable’ mean?

Through the Sierra Club’s Ready for 100% program, the Climate Reality Project’s 100% Committed program, and the RE100 initiative for businesses, the commitment to going 100% renewable is growing. While both the Sierra Club and the Climate Reality Project pledges are for a commitment to pursue 100% renewable energy in general, many communities see a move towards 100% renewable electricity as the first step in this process. It is important to note that the terms “100% Renewable Energy” and “100% Renewable Electricity” describe two different outcomes; and therefore, two different sets of strategies to achieve those outcomes. While the terms are often used interchangeably, “100% Renewable Electricity” refers specifically to the transition of the electricity sector to provide energy only from renewable resources (e.g. solar, wind, hydropower, geothermal, and battery storage). Taking this concept one step further, “100% Renewable Energy” refers to sourcing energy from all sectors from renewable resources—this includes the electricity, stationary fuel (i.e. natural gas and diesel), and transportation sectors. Many communities that have pledged to becoming 100% renewable are focusing on the electricity sector first. The Sierra Club recommends setting a goal of obtaining 100% renewable Electricity by 2035, and 100% Renewable Energy for all sectors by 2050. Further, the organization recommends including a local generation target, and focusing on collaboration with other local communities and public-private partnerships to achieve the goal.

It is further important to note that the transition to 100% renewable electricity and 100% renewable energy will be an important strategy for communities and businesses that are striving to significantly reduce their greenhouse gas emissions. While these efforts will not completely reduce emissions, the vast majority of emissions in the U.S. are a result of electricity consumption, which can be offset with renewable energy. In addition, as the electric grid becomes cleaner, stationary heating fuels (e.g. natural gas and propane) and mobile fuels (e.g. gasoline and diesel) can be replaced with electricity, further reducing building sector and transportation emissions.

By transitioning these resources to renewable energy, communities and businesses can see significant gains towards their emissions reductions targets.

Local communities are leading the way

Over 160 U.S. mayors or town/city managers have signed the Sierra Club’s Mayors for 100% Clean Energy pledge, and many other counties have made an equivalent local commitment. The factors that have led communities to make this commitment vary from energy independence and local economic development to climate commitment and action.

In Greensburg, Kansas, transitioning to 100% renewable energy was a logical step to ensure long-term community resiliency after the town was nearly leveled by a tornado in 2007. By rebuilding the town with a focus on energy efficiency, small-scale solar, wind, and geothermal the community achieved 100% renewable electricity in 2013. In return, the town has effectively harvested the wind that nearly destroyed it to rebuild itself stronger for future generations.

Larger communities are also pursuing and achieving 100% renewable goals as well: Aspen, Colorado, achieved 100% renewable electricity in 2015. By utilizing wind power, energy efficiency measures, hydro-power, a small amount of landfill gas, and small scale solar thermal, Aspen has lead the way in the transition to fully renewable electricity. For Georgetown, Texas, in the heart of oil country, the decision to commit to 100% renewable electricity stemmed from a desire to obtain long-term low-cost and low-risk energy for city municipal customers. The City-owned utility established a Renewable Portfolio Standard (RPS) in 2008 of 30% by 2030 and in 2012 bumped that goal up to 100% when low-cost and low-risk solar and wind bids were presented that significantly beat out fossil fuel prices. In this drought-prone part of Texas, renewable energy has the added benefit that it does not require the large amounts of water for production that is typically required by traditional fossil fuels.

While some communities, like Ithaca, New York, are achieving their 100% renewable goals through the purchase of Renewable Energy Credits (RECs) on the open market, others are taking a more direct approach. San Diego and San Jose are both working towards Community Choice Aggregation, whereby communities may buy and/or generate electricity for their communities by working directly with wholesale power providers. Others, like Burlington, Vermont, are encouraging energy efficiency and smart building processes while also pursuing renewable energy projects and policies. The switch to 100% renewable can save communities money as well: Burlington, which sources its power from 30% biomass woodchip burning, 20% landfill methane, wind, and solar, and 50% hydropower, anticipates that it will save $20 million over the next 20 years over the cost of traditional fossil fuels.

Overview of the Global Covenant of mayors for climate and energy

Our previous blog on the Global Covenant of Mayors for Climate and Energy sparked great conversations regarding what the Covenant specifically entails and many of our municipal clients are curious to learn more. Building off these conversations, please read below to learn more about this commitment, what it will mean for your community, and the benefits of emissions tracking and climate action planning.

What is the Global Covenant of Mayors?

The Global Covenant of Mayors for Climate and Energy provides a framework for communities to track greenhouse gas emissions and set reduction targets, as well as develop a climate action plan to prepare for climate change mitigation and adaptation. It is the world’s largest collaboration of local municipal leaders (including cities, towns, and counties of all sizes) that are tackling climate change head-on by pledging to track and reduce greenhouse gas (GHG) emissions and prepare for the impacts of climate change through mitigation and adaptation. Participating jurisdictions have access to a global network of communities from which they can learn, network, and collaborate. Further, joining the Covenant will provide your community with access to a broad set of toolkits, including access to the ClearPath GHG calculation and reporting tool through 2018. After 2018 your community has the option of joining ICLEI-Local Governments for Sustainability to continue to have access to this reporting tool.

Emissions tracking and climate action planning will allow your community to fully understand the impact of your operations on the climate and prepare for and adapt to our changing climate. The Covenant can be a useful tool of any local leader invested in sustainability and interested in addressing the effects of climate change.

What are the requirements of my participation?

There are four simple steps to follow:

Step 1: Register Your Commitment

Your first step to becoming involved in the Covenant of Mayors is to submit a formal letter signed by the Mayor or chief elected official that illustrates your community’s desire to track and reduce emissions and develop a climate action plan. The Covenant website provides a very useful template and guidelines for drafting this letter.

The Global Covenant of Mayors also provides the Carbonn and CDP reporting platforms for communities to easily report and track their progress. Once you have submitted your letter of commitment to one of these platforms, you will receive your official “commitment” badge to share and demonstrate your climate action leadership.

Step 2: Take Your Inventory

Within one year of registering with the Covenant of Mayors, your community must complete and report a GHG inventory that is consistent and robust—this means following the GPC guidelines for community-scale GHG inventories. The Covenant provides both the ClearPath GHG Inventory Tool and the City Inventory Reporting and Information System (CIRIS) tools to make emission calculations simple, transparent, and consistent across the globe. In the first year of your participation, the inventory need only encompass emissions generated from stationary energy use and inbound travel and transportation. At this stage, you will also identify the climate hazards and risks faced by your community—this may include environmental hazards and economic impacts from climate change, among other risks.

This inventory, as well as the climate hazards that you identify for your community, must be reported in your chosen reporting platform.

Step 3: Set Your Targets

Within the second year of committing to the Global Covenant of Mayors, you will need to update your community’s GHG inventory to include all sources and sectors of emissions, including waste. With this updated and more robust inventory completed, you can now begin developing your GHG reduction targets.

The Covenant of Mayors provides a useful tool for setting targets in the City Action for Urban Sustainability (CURB) Tool. Using inputs from the ClearPath GHG Inventory Tool, this scenario planning tool allows you to project out your GHG emissions in the coming years and develop options for creating an effective climate action plan.

Step 4: Develop Your Action Plan

You have measured your emissions, analyzed your climate hazards and risks, and created targets towards which you will strive. Congratulations—your community is now ready to develop a climate action plan! In addition to addressing how your community will mitigate climate change through reducing emissions and improving sustainability, your plan should also address how your community will adapt to the changing climate and ensure long-term community resiliency. This guiding document can serve your community for years to come as you increase your sustainability and climate resiliency and improve the quality of life for your citizens.

While the four steps to become Covenant compliant can be completed within three years, many communities find upon joining the Covenant that they are already well on their way to receiving their badge of compliance due to efforts they already have undertaken. Once compliant, you commit to continuing to report your emissions and update your targets as your progress towards your climate action goals.

Communities that are concerned about the effects of climate change, want to reduce their greenhouse gas emissions, and desire to plan and prepare to adapt to our changing climate may find the Global Covenant of Mayors an incredibly valuable tool and network. If you are in Colorado, you will find an additional useful resource in the Compact of Colorado Communities, which complements the Covenant of Mayors to support our local communities in reducing emissions and improving sustainability measures. The Compact of Colorado Communities is an incredible resource through which participating communities can access information sharing, networking, resources, and capacity building with other local communities that are facing similar challenges.

The Covenant of Mayors offers a framework and tools for conducting emissions inventories, setting targets, and developing a climate action plan. Communities may also pursue climate action planning and emissions inventories outside of participating in the Covenant.

If you are interested in joining the Global Covenant of Mayors, conducting a GHG emissions inventory, or developing a climate action plan for your community, but are still unsure of where to start, please reach out to us. We have a depth of experience in GHG inventories, sustainability strategy development, and climate action planning, and would be pleased to assist you in this process.

I joined a community solar program, now what?

So you have signed a contract to receive power from a community solar program. Congratulations! This is a decision that comes with great benefits to both the environment and your wallet. Now it is time to take a closer look at your monthly electric bill to make sure that you are maximizing your benefits.

Fully understand your program and your bill

Your solar energy credit will show up differently depending on who your utility provider is and what type of project you have subscribed to.

In Colorado, there are three types of incentive models for community solar: a utility bill credit, a Renewable Energy Credit, and a one-time lump sum. In the utility bill credit model, your bill will show a credit correlated to the dollar value of your share of solar production. This model is the most typical and will be the focus of this blog.

There are also two models for payment with community solar: purchasing your panels outright or paying-as-you-go for energy produced. The pay-as-you-go model is similar to your monthly cell phone plan---you will never own the panels, you will pay for their energy like a service.

If you are partaking in a pay-as-you-go plan, in addition to your monthly electric bill, you should also receive a monthly bill from your solar developer. Generally, this bill should be for a lesser sum than your utility bill credit, leading to a net savings.  If you paid for your solar array up front, you will not receive a bill from the developer.  

Ask the right questions when looking at your bill

It is important that you thoroughly examine your energy bill after you sign up for community solar. You will want to make sure your panels are producing as expected, check that you are being compensated for production, keep an eye on utility rates, and confirm that you are making the most of all incentives (both financial and environmental) offered to you. Some specific questions you will want to ask:

1.       Do my bill credits look right?

Your electricity savings will be influenced by a variety of factors (e.g. solar panel production, electricity use, base rate, and utility rates) and your utility bill costs may not be offset 100% by your solar program. Bill credits will cover a portion of your utility rate. In other words, if solar energy offsets 100% of consumption, bill credits could offset costs by 50% to 80%. While in the short term your savings will vary, over time a majority of your costs could be offset. With this in mind, it is important to keep tabs on whether your panels are under- or over-producing.

2.       Are my panels under-producing?

If your bill credits look too low you should call your utility and solar developer (your utility can help with billing issues, but the solar developer is better for production questions). If the panels are indeed under-producing, you will need to problem solve together. Most are very happy to help!

Your first step will be to figure out why the array is under-producing. Weather, panel degradation, and broken parts are all possible explanations. Once you have identified the issue, ask your solar developer what they can do to fix it. They can’t do anything about the weather but ongoing monitoring, maintenance, and repair are their responsibility. They have a budget for this that is set aside from funds used to initially build the project and/or revenue from the array.

Comprehensive insurance is also typically covered by what you have paid for your panels to cover events like theft, hail damage, or low production due to weather. Further, some contracts specifically state that the developer guarantees that they will catch any abnormalities very quickly (typically within 24 to 48 hours) and ensure that arrays are performing as expected. 

3.       Am I over-producing? If I am over-producing, am I receiving roll over credits?

When you signed up for your solar program, you were likely given the option to purchase a maximum of 120% of your average energy consumption. Thus, it is possible that your panels will produce more energy than you use in a particular month. With community solar, when you don’t use that extra 20%, you are still generating bill credits.

Your contract may guarantee that excess production “rolls over” to cloudier months when you under produce. If your contract has this clause and it doesn’t look like your production has rolled over, call your utility provider or solar developer.

Any bill credits accumulated at the end of the contract period may also simply go away. It is best to appropriately size the system so that you are not left with an excess of bill credits after the contract period is over.

If you find that you are consistently over-producing due to efficiency or a move to a new home, it is sometimes possible to resize your subscription with your solar developer or apply your subscription to an alternate location.

4.       How are utility rates changing?

The pace at which your utility rate increases from year to year can be very important in determining your savings from community solar. For most people, a high increase in electricity prices is unfavorable. For a community solar participant, an increase in electricity prices may be favorable. This is because one of the major financial incentives of community solar is that bill credits follow the rate of increase or decrease of utility rates. The higher your electricity rate is, the more bill credits you will receive and, over time, more bill credits means more savings. If your electricity rate is low, you will pay less for your electricity consumption, but you will also realize fewer bill credits and less long-term cost savings.

If you want to take a big picture look at your projected savings over time, the Clean Energy Resource Teams provides a calculator that allows you to compare price scenarios.

5.       Are there tax incentives available to me?

Federal tax credits generally go to the company that developed your community solar project, however, it is worth checking with your solar developer to be sure.

6.       Are there other financial incentives available to me?

It is also worth talking to your solar developer to ensure that you’re making use of all available financial incentives in your state, the Database of State Incentives for Renewables & Efficiency or your local utility can help guide your conversation.

7.       What is happening to my Renewable Energy Credits?

You may have heard of Renewable Energy Credits (RECs). A REC is the legal representation of the environmental benefits of producing one Megawatt-hour of renewable energy. Typically the utility company will own the RECs (and therefore the environmental benefits) associated with community solar.

Community solar offers unique financial and environmental benefits and is simpler and more flexible than rooftop solar in many ways. Depending on the future of electricity prices and the length of the contract term, the long-term value of community solar can amount to thousands to hundreds of thousands of dollars. We hope this list of questions to ask while examining your energy bills under a community solar program helps you make the most of your solar program.

We are always available to help you wade through the world of community solar and RECs. Feel free to reach out anytime to our team at emily@lotussustainability.com, hillary@lotussustainabilitiy.com, or lauren@lotussustainbility.com 

AN OVERVIEW OF ENERGY OUTREACH COLORADO: A CONVERSATION WITH ANDY CALER

Environmental justice issues are a growing concern for our clients. Thankfully, Colorado has many organizations helping our low-income communities through research and education and direct action such as subsidies and assistance. We asked Andy Caler from Energy Outreach Colorado (EOC) to tell us more about EOC’s work and environmental justice in Colorado.

Nearly one in four families will have trouble paying their utility bills this winter. How are utility bills and energy costs part of environmental justice and the broader definition of sustainability?

When your income is low and the availability of well-maintained affordable housing is limited, the opportunities for energy efficiency upgrades are generally substantial. Unfortunately, it’s difficult to take advantage of these opportunities when your income must be prioritized to pay for food, medical expenses, rent and other basic necessities. When you combine a less than average housing stock with limited income, you start to see utility expenses become a much higher percentage of household income with limited abilities to reduce it.

In addition, all rate-payers, regardless of their income, pay for regulated energy efficiency programs through their monthly utility bill, but low-income energy consumers don’t necessarily have the ability to participate and benefit from these programs. EOC advocates for these consumers and works with the Public Utilities Commission and individual utilities to ensure programs are available specifically for this population. Many utilities (Xcel Energy, Black Hills Energy, Atmos Energy, Colorado Natural Gas, San Miguel Power Association and Holy Cross Energy) throughout the state are very proactive about working with EOC to create low-income specific programs to reduce the high energy burden of this population.   

Why is it important to support low-income communities even if you are not low-income?

Beyond having a human interest in helping out those in need, all community members benefit from families and seniors being able to safely stay in their homes and afford their home energy. If an individual isn’t able to pay their utility bill, the utility takes on that bad debt and passes it on to other rate-payers.  If individuals are forced from their home because of increased rents and utility costs placing them further from their job, there is a negative effect on air quality and traffic congestion because of longer commutes. Living in unsafe, unhealthy conditions increases the medical needs of individuals and places a heavier burden of the health care system.  The list goes on.

One in five Coloradans are considered low-income, how does Energy Outreach Colorado reach these communities?

We have a variety of approaches. Our non-profit was founded in 1989 on our Energy Assistance Program which helps limited-income households keep their heat on by paying a portion of their past due energy bills. Since then we’ve introduced energy efficiency programs to lower energy bills in order to help address the root cause. We currently have efficiency programs to help single-family and multifamily owners and non-profits that serve the low-income population. We also administer the Crisis Intervention Program that helps individuals repair or replace a nonworking home heating system. EOC’s Impact by Numbers in FY 2015-16:

• 8,599 Colorado households received EOC energy bill payment assistance

• 4,372 affordable housing apartments were weatherized by EOC to reduce energy costs and usage

• 36 nonprofit facilities were weatherized by EOC to lower energy costs and usage and better meet the needs of low-income communities

• 1,683 low-income homes received free furnace repair or replacement through the Crisis Prevention Program

How does EOC integrate and include low-income communities in energy policy decision making?

EOC is a recognized and credible representative of low-income energy consumers in local, state and national energy policy discussions and rate cases because of our extensive knowledge and in-depth experience. We actively collaborate with other organizations serving this population to ensure low-income consumers are considered in potential policy decisions and to monitor and assess the effects.

What feedback have you heard from people that have participated in Energy Outreach Colorado programs?

Our clients are extremely appreciative of the help and support they receive. Generally, these services come at a time of extreme need and duress and often protect them from potentially unsafe conditions. We help these families and seniors avoid having to make dangerous choices between paying for basic needs like heating their home or buying food for their next meal. When a family’s furnace goes out in the middle of January, EOC can come in and repair or replace it at no cost. When an individual has a past due balance on their home energy bill and is about to get shut off, EOC can pay their debt so they can remain warm and safe in their home. It’s a nice reminder that the work being done is really helping individuals and truly impacts people’s lives.

How can our readers find any additional information or support the work of Energy Outreach Colorado?

By visiting EOC’s website http://www.energyoutreach.org, calling us directly at 303-825-8750, and signing up for our newsletter or making a donation.

 THANK YOU SO MUCH ANDY!

Finding Regional Consistency in GHG Accounting: The GLobal Covenant of Mayors and the GPC

Many of our municipal and county clients ask us to help them identify a community greenhouse (GHG) accounting approach that aligns with their peers and avoids double counting. Although there are a lot of resources, finding the right one can be tricky. Recently, a team of world leaders and international sustainability organizations got together to tackle this very problem. Drawing on extensive expertise in sustainability for local governments, the team formed the Global Covenant of Mayors for Climate and Energy  (Covenant) agreement.

The Covenant is a global agreement between cities to combat climate change. It provides a systematic approach for mitigating and adapting to climate change and includes requirements for GHG accounting, GHG reporting, and the development of action plans that set ambitious, voluntary GHG emission reduction goals.

One of the major requirements of the Covenant is that all community GHG inventories follow the Global Protocol for Community-Scale Greenhouse Gas Emissions Inventories (GPC). The GPC prescribes a standardized and transparent approach to collect GHG activity data, prepare inventories, and report GHG data. In this way, GPC is designed to help cities draw consistent inventory boundaries, prevent emission double counting, and provide a holistic inventory of all relevant GHG emissions. This is particularly important for a group of local cities that seek regional consistency.

Once GHG inventories and action plans are complete, Covenant members report their data to either the Carbon Disclosure Project (CDP) or Carbonn. The data is publicly available and allows interested parties to search for a city’s commitments and targets.

Since its launch in September 2014, the Covenant of Mayors has gained momentum and now boasts the largest voluntary membership base of cities in the world while encouraging coordination with the larger global community. According to ICLEI’s Executive Director, Angie Fyfe, more than 150 cities nationwide have signed on to the Global Covenant of Mayors Agreement. This number continues to increase as more and more communities look for a consistent and methodical GHG management approach.  Covenant members are nationally and globally recognized for their efforts and are exalted as global climate leaders.

We believe that this work is so important because population growth is growing at unprecedented levels. According to the World Health Organization the “urban population in 2014 accounted for 54% of the total global population, up from 34% in 1960, and continues to grow.”  Some estimates guess that 80% of the world population will live in cities by 2050. That is over 1 billion new people living in urbanized areas by 2050.  (See our blog: The Power of Municipalities for more information).

Cities have the ability, responsibility, and often the encouragement from the public, to take the lead and address climate change.

If you are considering making a locally and globally recognized commitment to GHG reduction and climate change, we encourage you to consider joining The Global Covenant of Mayors for Climate and Energy agreement. 

An Overview of Colorado C-PACE: A Conversation with Paul Scharfenberger

Last week, Lotus was fortunate to speak with Paul Scharfenberger, the Director of Finance and Operations at the Colorado Energy Office, about the new financing tool being rolled out called Colorado’s Commercial Property Assessed Clean Energy (“Colorado C-PACE”).  C-PACE financing is an innovative, yet proven, financing mechanism for commercial, agricultural, institutional, industrial, non-profit and multifamily (residential units with 4 or less units are excluded) properties to obtain low-cost, long-term financing (up to 20 years) for renewable energy, energy efficiency and water conservation upgrades.

Since many of our clients are interested in C-PACE, we were thrilled to ask him a few questions:

Recent conversations with private sector entities has highlighted that the interest in commercial PACE is growing and many believe it is a “game changer” for Colorado’s commercial and multifamily property owners. How is C-PACE different than other financing mechanisms for energy efficiency, renewable energy, and water conservation?

C-PACE is different from other financing mechanisms used to support energy and water improvements in the commercial and industrial sector in a variety of ways, but one of the most important distinguishing characteristics associated with C-PACE is the long term nature of the financing. C-PACE can be used to provide financing up to 20 years for these improvements, whereas standard commercial loans – the next likely alternative that a commercial property owner would pursue -  typically only extend to 5, 7, or 10 years depending on the loan recipient, the project being financed, and the lender providing the financing. By offering 20 year financing terms, C-PACE more closely aligns with the payback periods often associated with energy and water improvements and, in doing so, dramatically improves the cash-flows associated with these projects.

Beyond the long-term nature of C-PACE financing, the fact that it can be used to finance 100% of the project costs is unique to C-PACE. It can be used to finance the soft-costs associated with a project (e.g. any associated energy audit, feasibility study, etc.) as well as the hard costs (e.g. equipment and construction), whereas other financing mechanisms typically can be only used to finance the hard costs associated with a project. What this means is that a commercial property owner participating in C-PACE doesn’t have to bear any out of pocket costs for these improvement projects. This is particularly attractive for small to mid-size (Class B & C) building owners who often lack the capital budget for capital-intensive equipment upgrades, yet have pent-up demand to modernize their building. Moreover, the importance of this aspect of the program cannot be understated, especially in terms of how this provision of the program impacts our contractor communities’ ability to leverage this program to convert prospective projects to sales.

Finally, C-PACE is founded on the premise that it allows the financing obligation to transfer to the new owner of the property in the event of a sale of the property. With other financing mechanisms, the commercial property owner would have to be assured that he/she would remain in the property long enough to enjoy the financial payback associated with it. For deep energy/water retrofits, that payback period can be in excess of 10 years and, although it might be counterintuitive, commercial property owners do change locations quite frequently. By allowing the financial obligation to be tied to the property as opposed to the property owner, PACE ensures that the project costs and savings are always connected and, in doing so, addresses one of the primary barriers that commercial property owners face when considering whether to pursue an energy/water improvement project.

Approximately 19% of Colorado’s energy is consumed by commercial buildings, yet implementing energy efficiency and renewable energy upgrades in commercial buildings can be a (sometimes insurmountable) challenge. Which major roadblocks for energy efficiency, water conservation, and renewable energy upgrades does C-PACE address?

As I alluded to in my last response, the lending terms (typically 5-7 years) associated with other financing mechanisms and programs often don’t align well with the economics associated with energy and water improvements. These projects can have lengthy payback periods and it is imperative to structure the financing terms associated with these projects accordingly in order to make financing an attractive option to property owners considering these improvements – otherwise, commercial property owners likely won’t pursue these improvements due to their other competing budgetary demands. C-PACE addresses this issue head-on by enabling long-term financing (up to 20 years) that is more commensurate with the payback of these projects. As a result, C-PACE provides an attractive (“too good to be true”) financing option to commercial property owners that is difficult to overlook.

The transferability of the C-PACE financial obligation at the point of sale also addresses a major barrier that commercial property owners face when considering these improvements. If a property owner isn’t 100%  positive that they’ll remain in the same location long enough to enjoy the financial payback associated with an energy/water improvement, then it makes financial sense for them to err on the side of caution and not pursue the project. This is a huge issue in the commercial property sector - this barrier keeps many property owners who are interested in improving the energy/water performance of their buildings and enjoying the related utility costs savings from ever pursuing these improvements. Again, C-PACE addresses this issue head-on. A commercial property owner can pursue an energy/water improvement and if he/she decides to move and change locations a few years down the road, the financial obligation associated with the PACE improvement will remain with the property and fall to the next owner of that property, as will all of the utility cost savings that that project produces on an annual basis. 

Lastly, triple net leases are extremely prevalent in Colorado’s commercial sector. With a triple net lease, a building owner can pass increases to their property taxes (i.e. in the form of the PACE special assessment that is included on the property owner’s annual property tax bill) through to their tenants who often pay the utility bills. With other financial mechanisms, property owners are often deterred from paying for these building improvements because they will bear the cost, but their tenants will enjoy the benefit of the reduced utility costs – a barrier often referred to as the “split incentive”.  Obviously, most property owners will not choose to pursue such an arrangement, but because the PACE obligation is tied to the property taxes and can be passed through to the tenants with a triple net lease, property owners can finally pursue these projects and pass the costs and savings to their tenants, thereby addressing the “split incentive” barrier.

Now that we understand the many benefits, can you outline how C-PACE works?

Absolutely. Colorado’s C-PACE program operates within a statewide, voluntary special assessment district, called the New Energy Improvement District (NEID), that each county has the option to opt into through a resolution by the Board of County Commissioners. Once a county opts into the program, commercial business owners in that county can apply to the NEID to receive financing from private lenders for eligible energy and water improvements. The project applications, eligibility information, lists of eligible contractors and lenders, and other important program information can be found on www.copace.com. In applying to the program for financing, a property owner can either come to the table with an eligible contractor and/or lender in hand or it can apply without establishing those partnerships and the program administrator (Sustainable Real Estate Solutions, Inc – SRS) will help to connect those property owners with the eligible contractors and/or lenders who have already been approved to participate in Colorado C-PACE.

SRS will then review the project application to ensure that it meets the requirements and standards of the Colorado C-PACE program. If it does, then SRS and the NEID will begin working with the applicant to obtain mortgage holder consent which is required to move forward with the PACE special assessment. If consent is provided, then a special assessment/lien will be recorded within the county land records and the project will move forward to completion.

The NEID then provides each participating county a certified assessment roll that will include the PACE assessment amounts to be placed on the property tax bills for each property that has received PACE financing. This will be a separate line item on the property owner’s property tax bill that will be identified as the, “New Energy Improvement District Special Assessment”. The property owner will then pay their property taxes and the PACE assessment to the county treasurer - exactly as they would for their property taxes – and then the county treasurer will remit the PACE special assessments to the NEID who, in turn, will remit those payments back to the private lenders who provided the original PACE financing.

This continues until the entire PACE special assessment amount is repaid, at which time the special assessment/lien will be satisfied and removed from the property. I realize that it sounds complicated, but it is a proven model that is being used across the country and, as we discussed earlier, it offers several advantages as compared to other finance mechanisms.  

One of the benefits that many individuals and companies highlight regarding C-PACE is that it addresses the split incentives dilemma. Can you provide some background on how it does this?

Yes, happy to. As discussed earlier, the “split incentive” refers to the dilemma that a property owner faces when considering to pursue an energy/water improvement to a property that contains tenants who are responsible for paying their respective portions of the utility bill. The issue is that the property owner pays for the improvements, but it is the tenants that receive the benefits associated with those improvements that come in the form of reduced utility costs. This dilemma often results in a property owner not pursuing these improvements because it doesn’t make financial sense for them to do so.

This is where PACE comes into play. As mentioned, PACE operates under the guise of a special assessment that is repaid through the property taxes. Also as mentioned, triple net lease between building owners and tenants allow building owners to pass increases to their property taxes through to their tenants. What does this all mean? It means that PACE addresses the split incentive dilemma under certain lease arrangements which are common in Colorado by allowing the property owner to pursue and pay for these building improvements and then pass on the repayment obligation to their tenants who enjoy the benefits associated with the program.

Before closing, the benefit to the tenant under this situation should not be overlooked. In the majority of cases, the savings associated with these improvements will exceed the costs associated with them – the mortgage holder consent aspect of Colorado C-PACE all but guarantees this – meaning the tenants will benefit from utility costs savings that will exceed the costs that are being passed through to them. 

Are there any energy efficiency, renewable energy, and water conservation upgrades that are not allowed under the Colorado program?

The statute dictates eligibility based on utility savings and increased generation from renewables. This means that the eligibility requirements are broad and encompass a wide variety of different energy and water measures. That said, Colorado C-PACE relies on private sector lenders to provide the financing for these building improvements and the participating lender will have to be comfortable with, and ultimately sign off on, the measures being financed. In other words, a vast majority of measures that are proven and have demonstrated reliable utility cost savings will absolutely be supported by C-PACE financing, but nascent and emerging technologies may have a harder time obtaining financing because lenders may be weary of the payback expectations associated with them.

Colorado’s program is unique because Counties have to voluntarily opt-in to a New Energy Improvement District in order to participate.  Which Counties have opted in to date?

Well, it should be noted that they don’t “have to” opt-in to the NEID, but we sure do hope that they choose to – I not only feel that C-PACE will produce significant benefits to Colorado’s commercial property owners, but also the counties within which those properties reside.

To-date, Boulder County is the only county that has officially opted into the program, but I have met personally with 15 other counties in the State and am extremely confident that we will see the number of participating counties increase in the very near future.

If any of our readers live in a County that has not opted in to C-PACE but they are interested what are the next steps?

Well, for one, we’d like to hear from those folks. We are compiling a list of projects in counties that haven’t opted into the program because that is compelling information for us as we engage with counties – being able to show very real demand and economic development opportunities is obviously a powerful communication tool.

Beyond engaging with the NEID, it’s important for county representatives to learn of Colorado C-PACE from a variety of individuals and organizations. Although PACE is a model that has been pursued and proven across the country, it is a relatively new program to Colorado and it will take time and effort from a variety of stakeholders to inform decision makers as to the benefits that it can produce to the counties of Colorado.

If any of our readers have additional questions, how can they find more information?

www.copace.com is a great resource for program information, testimonials, application documents, etc., but your readers should always feel free to reach out to SRS (contact information is contained within the aforementioned website) and/or directly to me if they ever have questions about the program – we’re always more than happy to field inquiries and hopefully help your readers understand and navigate this very exciting program.

Thank you so much, Paul! More information about CoPACE can be found at the Colorado C-PACE website at www.copace.com.

Note: Photo by Matthew Wiebe. 

LOW-INCOME SOLAR SUCCESS STORIES

In Colorado, approximately 30% of households are considered energy burdened (more than 4% of their annual income is spent on utility bills) and 11% are considered energy impoverished (paying more than 10%). On average, low-income families spend over twice the proportion of their total income on energy bills then the average person in the United States.  Posada, a housing authority located in Pueblo, Colorado, reports that this percentage can be even higher. They have worked with low-income households that spend as much on their utility bills as they do on rent, and in some cases utility bills can exceed rent payments.

At the same time, the number of solar installations is growing rapidly and the costs of solar systems have drastically reduced. However, even with the reduced costs and myriad of incentives and procurement options, the benefits of solar photovoltaic (PV) remain largely out of reach for low-income households. Even more problematic, low-income households pay into utility PV rebate and incentive pools, yet they rarely, if ever, directly benefit from the rebate and incentive pools themselves.  The 49.1 million households that earn less than $40,000 per year (approx. 40% of all US households) account for less than 5% of solar installations. Improving the accessibility and uptake of community solar to low-income households is limited by a variety of marketing and communication, demographic, programmatic, and financial challenges. Fortunately, public and private entities are actively trying to solve this issue. So where have we seen some successes ?

Success #1: Community Solar: Helping low-Income households that rent or live in multifamily housing access solar

Many low-income households live in multifamily housing and/or rent.  Therefore, there is little incentive to put a solar system (long-term investment) on a roof that may not be theirs within a few years.  Solar gardens have helped solve this problem.  Solar gardens consist of a large photovoltaic array on a large parcel of land. Individuals or businesses can buy a number of solar panels from a solar garden array or purchase electricity generated by a specified number of solar panels and receive credit, as utility incentives, on their electricity bills for the energy production that they own.  Generally speaking, community solar is cheaper than individual modules because of the bulk purchase. Depending on how the solar garden is structured many times low-income households do not need to any upfront capital and see savings right away.

Click here for resources on how community solar can support low-income households. In addition, you can view the cutting edge Colorado Community Solar Gardens Act, which requires that 5% of electricity from each solar garden goes to low-income households by clicking here.

Success #2: Helping address the barrier of financing solar for low-Income households

There are many issues that arise for low-income subscribers when it comes to financing. Low-income households rarely have upfront capital to support a project and many low-income households are unable to get financing due to low or no credit scores (most solar leasing companies require a minimum credit score of 700!). In addition, even if they are able to get financing many households have too low tax liability to take full advantage of tax federal and state tax incentives.

Several companies have found workarounds by providing low-cost financing for low-income households. For example, PosiGen, a solar leasing company, has developed a low-income solar system leasing model that has successfully installed more than 4,000 systems since 2011. In order to fully utilize all of the tax credits, PosiGen leases the systems from US Bank who owns the panels. In addition, they utilize community redevelopment points, which are necessary to comply with the Community Reinvestment Act to reduce the interest further.

Many companies are also utilizing the public interest in supporting solar through crowdfunding, bonds, and impact investing. For example, Mosaic is providing low-interest financing through crowdfunding, while SolarCity is selling Solar Bonds.  All three mechanisms are creating pools of money to pay for low-income solar outright or provide low-interest loans.

For more information on various funding sources see our blog Finding Money and the great working paper by the GW Solar Institute. Also GRID Alternatives (a non-profit that focuses on bringing renewable energy to underserved communities) website has many resources that can be viewed.

Success #3: Utilizing LIHEAP funds for solar investment

The Low-Income Home Energy Assistance Program (LIHEAP) has historically assisted about 15 percent of all low-income households with their utility bills. This accounted for approximately $3.4 billion in 2014. Yet the costs of energy are rising and the need for energy assistance is growing rapidly. Traditionally, very little of these funds cover solar investment or energy efficiency and the majority of low-income households do not benefit from LIHEAP. Thankfully this is starting to change.

The state of California installed solar systems for 1,482 low-income households using LIHEAP ($14.7 million) funds and a match from outside partners ($3.5 million).  Also, the State of New York has proposed that all recipients of LIHEAP automatically become enrolled in community solar projects.  The goal of these programs is to stop paying simply for utility bills but have a more sustainable program that reduces costs over the long run enabling the program to support more than just 15% of low-income households.

These aforementioned challenges are just a few of the dozens of issues that lead to very few low-income households realizing the numerous benefits of solar. However, the overall theme from industry experts is that solutions are arising every day and there is great hope that in the near run through public, private, and nonprofit initiatives that we will be able to bridge the solar income gap.

For more information on how solar benefits the low-income market and what financing options may be of most interest contact us at emily@lotussustainability.com or hillary@lotussustainability.com  

DISCLAIMER

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

AUTHORS

Emily Artale, PE, CEM, LEED AP is Principal and Owner at Lotus Engineering and Sustainability, LLC, www.lotussustainability.com. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos, MBA, LEED GA is Principal and Owner at Lotus Engineering and Sustainability, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization.  Hillary has served on various local and national boards focused on conservation, energy efficiency, and renewable energy. Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, sons, and moderately trained canine, Mr. Smiles

Finding Money

Many sustainability professionals have experienced the frustration of not being able to implement energy efficiency and renewable energy upgrades for the sole reason that they are not able to pay for it. Even if the return-on-investment (ROI) is great, the cost of delaying the upgrade is high, and there is staff buy-in sometimes upgrades simply do not fit within the budget. However, the world of energy efficiency and renewable energy financing has matured considerably over the last ten years enabling many public and private sector entities to implement upgrades that would have previously not been feasible.  In fact, over the past decade, public-private financing programs for energy efficiency and renewable energy has grown to approximately $3 billion in 2013.

The following is a quick description of different financing mechanisms and funding resources that public and private sector entities can potentially tap into to finance energy efficiency and renewable energy projects (Note: each state and public jurisdiction has its own laws and statutes that may limit their ability to utilize some of the following mechanisms):

• Bond Financing: Bonds are a very common mechanism for financing in the public sector. They utilize debt security that can be used to pay for energy efficiency and renewable energy upgrades.

• Credit Enhancement Mechanisms: Credit enhancement is a method to expand the pool of borrowers who are able to access funding by improving the credit worthiness. Credit enhancement mechanisms include loan guarantees, interest rate buy-downs, and loan loss reserves.

• Energy Performance Contracting (EPC): EPC is a very popular way for public sector entities to finance improvements with guaranteed savings. EPC makes use of the cost saving from reduced energy and water consumption to help repay the cost of installing energy and water conservation measures. EPC takes advantage of tax-exempt lease-purchase agreements, which allow public organizations to pay for upgrades by using money already set aside in annual utility budgets. For more information on Colorado’s EPC program click here. For more information on other states EPC programs click here.

• Grants: Grants can be a lot of work to apply for and the timing can be an issue but they can make the difference of whether or not to move forward with a project. Grants can be provided through public sector entities (federal, state, and local) and non-profits.

• Green Banks: Green Banks are generally public financing institutions that support “green” investments by offering below-market interest rates or other financing incentives.

• On-Bill Financing and Repayment Programs: On-bill mechanisms are loans made by or in partnership with a utility. They allow customers to implement energy and water efficiency measures and then repay the loan with an additional monthly fee on their utility bills.

• Property Assessed Clean Energy (PACE): PACE is an increasingly common financing mechanism that enables property owners to implement energy and water improvements on their property and repay the costs through an annual assessment on their property tax bill. Click here to find out if PACE is available to you.

• Rebates and Other Incentives: For a better understanding of the rebates and other incentives available in your area see the DSIRE website.

• Revolving Loan Funds: Revolving loan funds provide financing for improvements. As loans are repaid, additional loans are made by the utility, government entity, or lending agency.

For additional information on financing program options, see the excellent NASEO report, Unlocking Demand: An Analysis of State Energy Efficiency and Renewable Energy Financing Programs in the Buildings and Industrial Sectors, which summarizes best practices from 21 state energy financing programs.

If you need any support wading through the many options for financing and funding a project please contact us at hillary@lotussustainability.com or emily@lotussustainability.com. 

AUTHORS

Emily Artale, PE, CEM, LEED AP is Principal Engineer and Owner at Lotus Engineering and Sustainability, LLC. Emily has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos, MBA, LEED GA is Principal and Owner at Lotus Engineering and Sustainability, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization.  Hillary has served on various local and national boards focused on conservation, energy efficiency, and renewable energy. Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, sons, and moderately trained canine, Mr. Smiles.

DISCLAIMER

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

The Power of Municipalities

Over the last 10+ years, we have worked with dozens of municipalities throughout the US on their sustainability initiatives. What are cities doing to address their impact? Everything! From studying their greenhouse gas emissions to setting reduction targets to implementing water and energy efficiency improvements to increasing renewable energy usage to increasing public transit, cities are reducing their impact. An impact that is being amplified as urbanization increases rapidly throughout the US and world.

Why are municipalities so powerful?

• Population Growth: Municipalities’ population growth is growing at unprecedented levels. According to the World Health Organization the “urban population in 2014 accounted for 54% of the total global population, up from 34% in 1960, and continues to grow.” Some estimates guess that 80% of the world population will live in cities by 2050. That is over 1 billion new people living in urbanized areas by 2050.

• Gross Domestic Product (GDP): Cities produce the majority of global GDP (we have seen estimates ranging from 60% to 80%!). This number is only supposed to increase as population increases.

• Resource consumption: The United Nations Environment Programme (UNEP) estimates that cities currently consume 75% of all natural resources and produce about 50% of global waste. This number once again is expected to rise.

• Greenhouse Gas Emissions: UNEP also estimates that cities currently produce between 60% and 80% of all GHG emissions making cities a critical participant and partner in the sustainability movement.

Per the statistics above, cities have the ability to make a huge impact but they also have a key advantage. Most (not all) municipalities have the freedom and ability to set goals and initiatives that directly resonate with their local audience by having a deep understanding of the various values, demographics, services available, cost of services, and available resources within their community. In return, they are able to set and make substantial headway on far reaching goals more efficiently and effectively.

In addition, cities act as a lab for innovative initiatives. Their successes (i.e., reduced costs, pollution control, etc.) and lessons learned help other governments (local, state, federal) improve upon their own sustainability initiatives (see ICLEI-USA for hundreds of great examples).

If you are looking for support on your sustainability initiatives contact us at emily@lotussustainability.com  or hillary@lotussustainabiliity.com. We can help define sustainability initiatives and bring relevance and insight into setting community sustainability targets.

DISCLAIMER

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

AUTHORS

Emily Artale, PE, CEM, LEED AP is Principal Engineer and Owner at Lotus Engineering and Sustainability, LLC. Emily has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos, MBA, LEED GA is Principal and Owner at Lotus Engineering and Sustainability, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization.  Hillary has served on various local and national boards focused on conservation, energy efficiency, and renewable energy. Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, sons, and moderately trained canine, Mr. Smiles.

Achieving Substantial Sustainability Goals: You might be doing better than you think

By Hillary Dobos and Emily Artale

Many sustainability professionals have inherited far-reaching sustainability goals that they did not create or they have aligned their goals to meet national goals such as the Better Buildings Challenge with little understanding of how to actually achieve their goals. This can pose an intimidating proposition that can result in entities giving up on their goals because they are seen as impossible to achieve. However, before giving up on goals or setting less lofty new ones know that there are many external trends that are already helping you and you might be doing better than you think.

Greenhouse Gas Reductions: Utilities Might Help You Achieve Your Goal

Due to increased (actual and projected) regulations, cheaper renewable energy and natural gas, and grid improvements the CO2 emission factors for electricity have reduced almost universally across the US. Therefore, when calculating your GHG emissions for electricity you will most likely see a decrease in emissions over time even if your electricity use remained constant or increased slightly. Sometimes this CO2 emission factor decrease is so substantial that an entity could meet much of their GHG reduction goal based on the reductions in the emission factor alone. For example, Xcel (Colorado subsidiary) reduced their CO2 emission rate per MWh generated by 22% between 2005 and 2013 and expect to see a 35% reduction by 2020 compared to 2005. Therefore, an entity with facilities in Xcel’s territory will experience a substantial decrease in GHG emissions even if their electricity use remains constant. 

Renewable Energy is Cheaper and Easier to Purchase

Historically, many entities have shied away from purchasing renewable energy to meet their goals because of procurement costs. However, due to large leaps in technology, tax benefits, new financing mechanisms, and competition renewable energy is quickly becoming or is already cost effective. See our past blogs An Overview of Solar Power Procurement Options, Increasing Transparency of the Solar Garden Process, and Renewable Energy Credits (REC): A Review of the Basics and Questions to Ask before Utilizing RECs as a Way to Meet Renewable Energy Goals for a review of how to purchase renewable energy.

Cars in the U.S. are more Fuel-Efficiency than Ever

Almost every year the United States hits a new record for fuel efficiency. This is driven by consumer demand, new technologies (hybrid vehicles, lighter vehicles, gasoline direct injections, etc.), international competition, oil prices (current and expected), and strict new fuel-economy standards.  As such, many fleets have become fuel efficient without even intending to and, as with electricity CO2 emission factors, this universal increase in efficiency has led to reduced transportation CO2 emission factors.

Normalize Data: Don’t be penalized for success or growth

Many goals do not take into account growth (population, employees, building stock square footage, etc.). Without normalizing goals for growth an organization can be unfairly penalized for success. For example, if a company’s building stock grows by 20% during their energy reduction goals timeline they will be unfairly penalized for this growth unless they normalize by square feet.  While we still encourage an overall reduction in resource usage, if a company or public entity is having trouble meeting their goals, it is important to see if some of this is caused by growth. If so, normalize the data and you might not be as far away from your goals as you had thought.  

If you are trying to set, achieve, or calculate your sustainability goals, we are here to help. For more information please contact us at hillary@merrillgroupllc.com or emily.artale@lotussustainability.com. 

Disclaimer

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Authors

Emily Artale, PE, CEM, LEED AP is Principal and Owner at Lotus Engineering and Sustainability, LLC, www.lotussustainability.com. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC, www.merrillgroupllc.com. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, sons, and moderately trained canine, Mr. Smiles.

Selling Sustainability

By Emily Artale and Hillary Dobos

There are skeptics everywhere. How do we, as energy and sustainability professionals, convince them that pursuing sustainability is not only the right thing to do, but it can also be profitable?

One approach has been to share the dozens of case stories of big businesses and progressive municipalities saving money through sustainability initiatives (think Dow Chemical, Interface, City of Boulder, City of San Francisco, King County, etc…). But, for some reason these stories do not always result in a massive buy-in of sustainability and sometimes you may even lose the attention of your audience.

And why does this happen? Perhaps these stories do not provide a roadmap that is relevant to the values, demographics, location, and other unique factors of the community that you are speaking to. For instance, although the City of San Francisco may be a good example of what should or could be done (e.g., 80 percent waste diversion goal!), it may not provide the roadmap necessary to sell your audience on what they can do locally.

To recapture the attention of your audience and to convince them that sustainability does have value to them and to their stakeholders, we need to make this conversation relevant. And we can do that by basing our plans, projections, and best guesses on data that is pertinent and specific to the needs of your audience.

Look at what initiatives may resonate with your audience by considering the values, demographics, services available, cost of services, and available resources within your community. Start by asking some simple questions, for instance:

• Does your community have a history of progressive change or do they prefer to keep things “as they always have been”? Are they willing to change?

• How willing is your utility company to work with your community in reducing energy?

• What resources exist in the community to help guide and maintain change?

Use the answers to these questions to help shape your sustainability initiatives. But, don’t stop there, do your homework and look at the performance data from the entities and individuals that have been in your shoes to help define sustainability targets. Research, analyze data, question data, interview communities and professionals, evaluate your results, and discuss with your community. From this data you can tell what worked, what didn’t, what target levels were achieved, and most importantly, how these target levels were achieved.

Based on your research, consider offering a menu of options and let your audience decide which initiates most resonate with them. Even though all initiatives may share the common theme of sustainability, people may naturally rally behind certain initiatives because they support their values.

Not sure how to create a menu of sustainability initiatives specific to your community? Contact us: emily.artale@lotussustainability.com or hillary@merrillgroupllc.com; we can help define sustainability initiatives and bring relevance and insight into setting community sustainability targets.

Storytelling with Utility Data

By Emily Artale and Hillary Dobos

One of the first steps of any successful energy management program should be an analysis and review of your building’s utility data. This is one way in which your building tells a story of its performance. We, as Energy Managers, use this story to verify personal narratives of your building’s operation, evaluate opportunities for improvement, identify patterns and trends of energy consumption, and benchmark against similar facilities. And, sometimes we can use this data to identify immediate solutions for cost savings.

How can such a seemingly simple resource provide so much valuable information? Utility data is objective and accurate; it documents actual consumption values and actual costs with an infallible memory. It can tell us when the building becomes occupied, when the building is reaching its peak demand, and when abnormalities in use and costs occur.

IMAGE COURTESY OF CLEER

For example, a building operator believes that the Administration complex “turns on” at 5:30 a.m., ahead of when most occupants will be in the building, however when reviewing real-time utility data we notice that a large spike in use begins at 4:00 a.m.! During discussions with building staff it was revealed that the building’s energy systems were turned on at 4:00 am a few months ago in advance of an early morning meeting, but the building’s systems were never reset. Changing the settings back to the original time will result in annual energy and cost savings.

In another real-life example, a review of utility data shows that a local government agency has consistently been charged for taxes over the last five years.  A summary of this data was brought to the attention of the utility company and all tax payments were refunded.

In both instances, a review and analysis of utility data resulted in annual cost savings with no upfront payment!

Likewise, you, as a manager of a building, can use utility data to encourage investments in efficiency improvements. Once building improvements have been made, you can continue to track utility data to identify energy savings from the building improvements themselves. Some organizations also use utility data as an innovative way to promote changes in occupant behavior. In lieu of sharing actual utility bills, these organizations may publicly share energy consumption through a dashboard tool in hopes that a demonstration of energy use will encourage better occupant behavior.

And, as you review your utility data be sure to benchmark it. This can give you additional insight as to how your building is performing against its peers or how several buildings compare against one another on a large campus.

For a relatively simple data analysis there are a variety of free tools from which to choose such as ENERGY STAR’s Portfolio Manager and EnergyCAP’s GreenQuest or even a simple Excel spreadsheet. For a more robust analysis consider a more sophisticated tool such as EnergyCAP or CLEER’s ultra-useful Building Energy Navigator tool.

There are hundreds of utility tools available to you. We are both experienced at selecting appropriate utility tools, implementing them, and analyzing the resulting data. Feel free to contact us at emily.artale@lotussustainability.com or hillay@merrillgroupllc.com. 

Authors

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Emily Artale, PE, CEM, LEED AP is Principal and Owner at Lotus Engineering and Sustainability, LLC, www.lotussustainability.com. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC, www.merrillgroupllc.com. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

An Overview of Solar Power Procurement Options

By Hillary Dobos and Emily Artale

Many of our clients have shown interest in pursuing solar energy but are quickly overwhelmed by the myriad of solar power procurement options available to them.

This blog provides a brief overview of some of the options for procuring solar power. As different organizations may have diverse goals for solar procurement, finding the “right” option(s) will also vary. We do not specifically endorse any one method over the other, but rather provide some basic information to answer some of the most common questions.  

Solar Procurement Options

Renewable Energy Credits (also known as RECs, Renewable Energy Certificates or greentags)

A grid-tied renewable electricity generator, such as a solar array, produces two distinct products: 1) electricity and 2) a package of environmental benefits resulting from not generating the same electricity and emissions from a conventional natural gas or coal-fired power plant. These environmental benefits are collectively known as Renewable Energy Credits, or RECs. RECs are sold, traded, or bartered on a market or through bilateral transaction.  RECs are used by entities as a way to reduce their environmental footprint and help fund renewable energy development.  They allow organizations to claim that the electric power they are using comes from renewable sources and apply the renewable attributes to any facility.

• Unique benefits: Simple transactions, flexible market in that you can select the location, resource type, and vintage of RECs, you can claim environmental benefits if RECs are retired, and one time purchases are possible, unlike other options where long-term contracts are usually required.

• Things to consider: RECs do not hedge against increasing energy costs, they do not always come from a local project, and the environmental attributes can be hard to explain to constituents.

For more on RECs see the following blog “Renewable Energy Credits (RECs): A Review of the Basics and Questions to Ask before Utilizing RECs as a Way to Meet Renewable Energy Goals.”

Participate in a Community Solar Garden

Solar gardens consist of a large photovoltaic array on a large parcel of land. Individuals or businesses can buy a number of solar panels from a solar garden array or purchase electricity generated by a specified number of solar panels and receive credit, as utility incentives, on their electricity bills for the energy production that they own.  Solar gardens make sense for entities that are unable or not prepared to host or own a system on their building’s roof or adjacent to their property and do not want to be responsible for the maintenance of a system.

• Unique benefits: Operation and maintenance is administered by a third party, solar is ideally located for maximum production output and is usually from a local resource, and the owner usually has the ability to transfer renewable energy to different premise locations. In addition, potentially save money compared to regular electricity costs and provides a fixed cost of electricity over the life of the system helping hedge against increased energy costs.

• Things to consider: Community solar gardens are not widely available, participating entity might not be able to claim environmental if RECs are not retained, and participating in a solar garden can be a complex transaction.

For more information on Solar Gardens see the following blog “Increasing Transparency of the solar Garden Process: The Top 4 Questions You Should Ask When Considering Participation in a Solar Garden.”

On-site Generation  

An organization that is able to install solar on their own facilities can take advantage of several unique financing options including (but not limited to): leasing solar panels, Power Purchase Agreements, and buying the system outright.

• Unique benefits: On-site solar is visible and tangible and therefore easily communicated to constituents, supports local jobs, usually reduces demand charges, sometimes increases property value, and typically provides a fixed price for electricity over the life of the system hedging against increased energy costs.

• Things to consider: On-site solar can require more upfront planning and project management then other solar options. Other considerations include on-site maintenance of equipment; energy production is limited by location and shape of building(s); and many times substantial upfront capital is needed.

Own the system

Many entities decide to purchase their systems outright through self or third-party financing.  

• Some additional unique benefits: Some host entities can benefit from the cash rebates, Federal Investment Tax credits, State Tax Credits and other incentives (including balance sheet benefits such as depreciable asset on the books) available for installing solar (see DSIRE website for a list of incentives, rebates, etc.).

• Additional considerations: Maintenance requirements will fall on the host entity. Please note that owning a system outright can be very legally exhausting for many public and private sector entities that must consider indemnification laws, insurance requirements, and for some public entities TABOR laws before interconnecting to the grid.

Power Purchase Agreements (PPAs)

In a PPA a third party project developer (usually called a solar services provider) coordinates the building and maintenance of an entities on-site system. The entity, in return, purchases only the power that is produced from the system. This model greatly simplifies the process of solar by having the experienced solar service provider deal with complex design and permitting processes, benefit from tax credits (something the public sector and some private entities do not benefit from) and take on some of the system performance risks. In addition, little or no upfront capital costs is needed because the entity pays only for a stable, and sometimes lower cost of electricity, then would be paid to their utility.  Power purchase agreements are typically for large centralized solar generation stations that provide energy directly to a utility.

• Some additional unique benefits: No upfront capital costs are needed, projects are sometimes cash flow positive on day one, long-term energy costs are known, and solar service providers are incentivized to maintain panels.

• Additional considerations: Long term contracts are usually required and if you sell your property before the lease is up you might have to pay a fine or removal fee.

Solar Lease

A solar lease is very similar to a PPA except for a very important difference that with a solar lease you rent the equipment, while with a PPA you are buying electricity.  Therefore, even when the array is producing less due to weather or maintenance issues the entity pays the same (or predictably increasing) amount for the equipment.

• Some additional unique benefits: Very predictable cost structure.

• Additional considerations: The host might be required to do some of the maintenance of the equipment. Long term contracts are usually required and if you sell your property before the lease is up you might have to pay out the remaining lease payments.

Next Steps

Before moving forward we recommend that you do the following before further pursuing solar:

• Understand your motivations for wanting to pursue solar energy. This will directly affect which option you pursue.

• Understand your budget and whether or not financing is an option.

• Take a look at your buildings solar potential. The National Renewable Energy Laboratory provides several free calculators (PVWatts Calculator and System Advisor Model) that allow you to estimate the energy production and cost of energy for installing a PV system.

• Research solar power procurement options available to your location. See EPAs Green Power Locator and/or the Solar Energy Industries Association database for a list of providers.

• Contact us at emily.artale@lotussustainability.com or hillary@merrillgroupllc.com for a more thorough review of each option and the resulting costs/savings to your community/company.

Authors

Emily Artale is Principal and Owner at Lotus Engineering and Sustainability, LLC. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Question Everything

By Emily Artale and Hillary Dobos

In the television series, Cosmos, Neil deGrasse Tyson explains that one reason science works is because science requires that we question everything. And, through this process we uncover the truth. As you embark on new sustainability and energy projects and programs we encourage you to apply this practice in your search for the most effective, economic, and sustainable outcome.

As more and more people demand sustainable solutions, we see an increase in the number of sustainability options offered by a variety of private, government, and non-profit organizations. It can be overwhelming. How do we know what is a legitimate offering and what is too good to be true? Our proposed answer: QUESTION EVERYTHING. And, while you are at it, document everything.

For we all want a more sustainable and low-carbon planet, but no project, no matter how enticing, provides a 100% guarantee of project performance. One of the best things that we, as project managers, can do is to educate ourselves so that we may understand the projected performance and the implications of project risks. Furthermore, it is our responsibility to ensure that:

1)   Project performance is based on sound and realistic assumptions and assumptions are clearly defined and documented;

2)   Our expectations for project performance are reasonable and clearly communicated and understood by all direct stakeholders; and

3)   Performance risks are properly identified in the beginning of a project so that we may be adequately prepared in the event that a modification occurs (for it most likely will).

Consider applying the following quasi-linear approach when evaluating the reasonableness and effectiveness of new or relatively new programs and projects.

As you develop and implement new programs to improve your sustainability and the sustainability of your community, we encourage you to ask lots of questions and do not stop until you get clear and definitive answers. Create a legacy document for future staff by documenting your questions and the responses. Identify performance risks and understand the implications if such issues were to occur while preparing your staff for the impacts. Clearly communicate this process with your direct stakeholders to set expectations and to get buy-in from the group. As required, this process may need to be repeated.

No matter how attractive a project may seem at first it will only be as successful as shown by its performance after the project is completed. And in some cases, we may not understand a project’s performance until a year later.

To encourage the success and development of sustainable technologies, programs, and projects we need to be sure that our programs are robust and transparent. We can accomplish this by using one of the fundamental principles of science – question everything.

Not sure which questions to ask and/or which responses are reasonable and align with general best practices? Contact us: emily.artale@lotussustainability.com or hillary@merrillgroupllc.com. “Questioning everything” is our job.

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News

Visiting the Energy, Utility & and Environment Conference in San Diego, February 2015? Be sure to connect with Emily Artale while you are there. Emily will be participating on an NREL panel of industry experts to present on community solar gardens. She will demonstrate how you can apply the practice of “questioning everything” to uncover the risks and opportunities of solar gardens. 

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Authors

Emily Artale is Principal and Owner at Lotus Engineering and Sustainability, LLC. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Setting Reduction Targets with Limited Information

By Hillary Dobos and Emily Artale

Setting sustainability targets can be one of the most intimidating and invaluable steps in creating a robust sustainability program.  Goals need to be measurable and have real appeal to constituents and decision makers, but most importantly, goals need to be credible.  We define a credible goal as one that can be realized while pushing the organization to make meaningful, aggressive changes where real benefits accumulate.  But, how can an organization identify quantifiable, credible targets with limited information? How can they ensure that their goals are achievable so they do not miss their targets, while ensuring that they are not so easy that they are perceived as pointless?

The following is a list of tips that we have found helpful through our experiences helping clients – large and small - set credible, impactful and quantifiable goals with little or no information:

• Ask facility and fleet managers what they think is possible. Often these employees are much closer to the day-to-day activities of existing procedures and they are among the first to recognize opportunities. In addition, they will (hopefully) be able to provide an overview of recent or expected upgrades that might affect the reduction potential. For example, if a fleet has switched over 25% of their vehicles to electric vehicles, then a goal for petroleum reduction must reflect this recent change. Lastly, facility and fleet managers will also play a critical part in achieving these goals so their input and buy-in is invaluable.

• Research your competitors. Competitors that have set goals (internal and external) provide a wealth of knowledge of what can be accomplished and what goals speak to your constituent. Companies that have reported on whether or not they have met their goals are especially valuable examples.  In addition, if competition with competitors is one of the drivers for your sustainability efforts, you will want to make sure that your company has equivalent (or close to) goals as competitors.

• Be creative on where to acquire past data. Most sustainability managers that are creating plans from scratch have very little data to base their goals on; however a lot of data might be more accessible then one thinks.  For example, most companies have tracked their utility costs through their accounting system. Using some “back of the envelope” calculations, a manager can understand if their overall utility costs have been going up at a quicker or slower rate than normal utility cost increases. As long as the process is consistent and transparent overtime your goals will be sound.

• Understand your budget.  Many goals will cost money upfront even if they have a great return-on-investment. Understanding where and how that budget will be allocated will help you know what is realistic.

• Align goals with national goals.  Many public and private sector entities have simply matched/joined on to national goals such as the Better Buildings Challenge with the thought process of “they will figure it out as they go”. While this can be risky many companies and public sector agencies have signed on to these goals and have risen to the challenge to meet these targets because the 1) goals come off as credible; and 2) are very public.

Lastly, before setting sustainability targets, we recommend that an organization familiarizes itself with the SMART (Specific, Measurable, Achievable, Relevant, Time Bound) framework for setting goals. The following shows how the framework would be used for a goal for energy reductions for a company.

• Specific: We will reduce energy use per square foot (kBtu/sq. ft.) by 20% by 2030 for our entire building stock. (Note: Make sure your goals can be normalized for growth to ensure that you are not penalized for company’s successes. For example, if a company’s building stock grows by 20% during their energy reduction goals timeline they will be unfairly penalized for this growth unless they normalize by square feet.)

• Measurable: We will track data through software on a monthly basis. (Note: Never underestimate the time consuming nature of tracking data. If you can’t find a transparent, realistic way to track data, then you might want to look at qualitative goals instead. Note: see our last blog titled Why You Should Never Overlook Qualitative Achievements When Developing Your Sustainability Goals to understand why qualitative goals are really important.)

• Achievable: We believe we can achieve this through low-cost upgrades and behavioral change.

• Relevant: Energy reduction supports the company’s goals of leading by example, transparency, and reducing costs.

• Time Bound: The 20% reduction goal will be broken down into intermediate goals of 5% reduction by 2015, 10% reduction by 2020, 15% reduction by 2025, 20% by 2030.

For more information on goal setting see our webinar “How to Set Effective and Measurable Sustainability Goals” and contact us at emily.artale@lotussustainability.com  or hillary@merrillgroupllc.com.  

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Authors

Emily Artale is Principal and Owner at Lotus Engineering and Sustainability, LLC. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Why You Should Never Overlook Qualitative Achievements When Developing Your Sustainability Goals

By Emily Artale and Hillary Dobos

When setting goals that support sustainability initiatives we typically think that our quantitative achievements will be more compelling and more important than our qualitative achievements. Quantitative achievements can be easier to define, easier to communicate and easier to link to dollars spent or dollars saved. This makes their value stand out and makes them the preference of many “goal-setting experts”.

However, environmental and sustainability initiatives and programs are different than most traditional initiatives and programs that you might encounter in your organization. Sustainability programs are still evolving and some of these programs are still new to many public and private organizations. In some instances, we are still learning what is possible and therefore, we do not always have a legacy of projects from which to learn.

In this case, identifying and promoting your qualitative achievements may be just what you need to effectively describe the value of your program or initiative. Not only can qualitative goals and achievements provide you with the opportunity to be innovative, creative, and push the edge of what is seemingly possible, they also require less investment to track (including time and money), they can quickly illustrate the value of your program, they can be easily customizable, and they can help support quantitative goals and/or help you develop a baseline for future initiatives.  

We have identified three basic ways in which qualitative achievements bring significant value to your project:

(1)   Proving that a program or initiative was completed: Sometimes you will be starting an initiative completely from scratch, such as creating an Environmental Purchasing Policy or Recycling Program. It may take more time and money that it is worth to define quantitative goals for this new initiative, and by simply identifying the accomplishments of the program you may have enough information to show that you have met your initiative’s goals.  

(2)   You are not sure what is possible and/or your do not have a baseline of your past performance: As you work through your program try to record as much data as possible. This may include contact information, demographic and geographic information, notes from conversations, assumptions from participants, etc. At the end of the program organize this data so that you can identify patterns. As you begin to notice significant patterns, you may see that some of these topics are valuable to your program and/or constituents. And, although, these topics may not have been identified in the beginning, these repeated topics could suggest significant qualitative achievements. If you wish to demonstrate your qualitative achievements as numeric values, simply convert your qualitative achievements to a more quantitative metric by expressing your qualitative achievements as a count. Use this count to determine if your original goal was achieved. For instance: You are running a program that provides sustainability services to your community. One of your goals is to promote sustainability within your community (aka qualitative goal). However, you do not have the budget or time to define what it means to “promote sustainability”. Once your project is complete you look at notes from your conversations with participants and realize that 60% of your participants were brand new to sustainability before you came along. You can now say that your 60% of your program participants have engaged in sustainability when no opportunity existed before and you have met your goal of promoting sustainability within your community.

(3)   Revising existing initiatives or developing baseline for future programs: Using the example identified above, you can dig a little deeper and use this information to define quantitative goals for future initiatives and/or refine goals for existing initiatives.

Lastly, make sure to use your qualitative achievements as bragging rights to promote the success of your program!

To learn more or get help with your goal setting please contact us at emily.artale@lotussustainability.com or hillary@merrillgroupllc.com.

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Authors

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Emily Artale is Principal and Owner at Lotus Engineering and Sustainability, LLC. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

Renewable Energy Credits (RECS): A Review of the Basics and Questions to Ask Before Utilizing RECs as a Way to Meet Renewable Energy Goals

By Hillary Dobos and Emily Artale

The Basics

A grid-tied renewable electricity generator, such as a solar array, produces two distinct products: 1) electricity and 2) a package of environmental benefits resulting from not generating the same electricity and emissions from a conventional natural gas or coal-fired power plant. This package of environmental benefits is known as Renewable Energy Credits (also known as RECs, Renewable Energy Certificates or greentags). A REC represents the collective environmental benefits, such as avoided carbon dioxide and mercury, as a result of generating one MWh or 1000 kWh of renewable energy. RECs are then sold, traded, or bartered on a market or through bilateral transaction.

There are two distinct markets for RECs: compliance and voluntary.

Compliance Market

The compliance market is made up almost entirely of energy companies that are mandated through a Renewable Portfolio Standard to own or purchase a certain percentage of renewable energy. Many utilities rely on RECs to help achieve these renewable energy percentages. Compliance RECs are usually more expensive and required to be purchased from within a specific region. For example, Xcel Energy is mandated through the State of Colorado’s Renewable Energy Standard to generate or cause to be generated at least 30 percent of its electric sales from “eligible energy resources”, one of which is renewable energy sources.[1] One way that Xcel Energy meets its mandate is by purchasing RECs from solar arrays that are interconnected into Xcel Energy’s grid. When RECs are purchased from the solar array, the owner or subscriber of that array can no longer claim the environmental benefits of the system.

Voluntary Market

The voluntary market is made up of individuals, households, and organizations that chose to buy RECs as a way to reduce their environmental footprint and help fund renewable energy development.  RECs allow organizations to claim that the electric power they are using comes from renewable sources and apply the renewable attributes to any facility. Additional benefits include hedging against future electricity price increases and numerous public relations benefits such as brand differentiation, generating customer loyalty and employee pride, and leading by example.

In general, voluntary RECs are cheaper than compliance RECs. Between 2010 and mid-2013, wholesale REC sales in voluntary markets have generally traded at less than $1/MWh (J. Heeter and T. Nichols, NREL Report, 2013)  In general, the cost of RECs can depend on many factors such as type of renewable energy (e.g. solar RECs are generally much more expensive than wind), the vintage (year in which REC was generated), where the REC was generated, the volume purchased, and if the RECs are 3rd party certified (e.g. Green-e Energy). Low prices often make the purchase of RECs a very cost effective option for supporting renewable energy.  

RECs can be purchased through utilities, REC marketers, and other third party entities who may sell RECs alone or bundled with electricity. For a current list of companies offering voluntary RECs click here.

What You Can Do

There are several questions that you can ask to better inform yourself before purchasing RECs

• Clearly understand your motivation for purchasing RECs and make sure it aligns with your sustainability and energy goals.

• Consider all of your options for procuring renewable energy such as community solar or entering into a power purchase agreement before committing to the purchase of RECs.

• There are many ways to purchase RECs (wholesale, long-term contracts, through your local utility). It is worthwhile to consider a few of the options to find the best fit.

• Make sure your RECs are third party certified (i.e. Green-e Certified) to guarantee that they are not double-counted (only one buyer can claim the RECs) and meet national standards for resource content and environmental impact. You can also buy RECs that have been issued by a regional certificate tracking system.

• If supporting local renewable energy generation is important to you, make sure to ask where the RECs were generated.

• Ask what vintage your RECs are (the date when the RECs were created), as well as the renewable generators vintage (the year the renewable generator was built). Older RECs might be cheaper but it is harder to make the argument that your purchase is leading to the creation of new renewable energy if the RECs were created in past years.

• Discuss the role of additionality with your REC vendor. Additionality means that the purchase of RECs introduces new renewable energy into the electricity grid beyond what would have happened in a “business as usual” scenario. In other words, your purchase of RECs is not simply subsidizing renewable energy that has already been added to the grid but instead helping an electricity supplier generate electricity from a renewable energy source that would otherwise be too costly.

• Consider long-term purchase agreements. Many companies are entering long-term REC purchase contracts (10-20 years). These contracts help stimulate renewable energy production by providing predictable cash flow to a developer and usually provide cheaper RECs due to the bulk purchase.

• If your company or organization owns a renewable energy system, research the utility connection agreement to see if you have retained your RECs. If so, then you can claim the environmental benefits. If you have sold your RECs, your organization cannot make certain environmental claims such as “we are reducing our greenhouse gas emissions” or “we are using or generating a certain percentage of renewable energy to offset electricity use.”

We are available to help you wade through the complicated world of RECs, carbon offsets, and financing renewable energy purchases. For more information please contact us at hillary@merrillgroupllc.com or emily.artale@lotussustainability.com.

[1]“2014 Renewable Energy Standard Plan”. Public Service Company of Colorado. July 2013. http://www.xcelenergy.com/staticfiles/xe/Regulatory/Regulatory%20PDFs/CO-RES-Plan-2014-Vol-1.pdf

Join us for our webinar series that discusses emerging topics in the sustainability and energy fields. Our next webinar titled, “How to Set Effective and Measurable Sustainability Goals” on July 30th, 2014 at 12:00 p.m. MDT. To register please visit: http://www.anymeeting.com/PIID=EA57D680844A3B

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AUTHORS

Emily Artale, PE, CEM, LEED AP is Principal and Owner at Lotus Engineering and Sustainability, LLC, www.lotussustainability.com. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC, www.merrillgroupllc.com. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

 

Disclaimer: The information presented above is based on the opinions and experience of the authors. The authors are not liable for any errors or omissions in this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.

Increasing Transparency of the Solar Garden Process: The Top 4 Questions You Should Ask When Considering Participation in a Solar Garden

Community solar gardens are an emerging and an innovative approach to acquiring renewable energy. Many of our clients are asking us about the risks and benefits of participation, with an emphasis on understanding potential impacts on their financial bottom line and the ability to meet community sustainability and energy goals. We invite you to read our take on this process and use this information to guide conversations with your solar garden developer or utility company representative.

To learn more or receive an analysis specific to your organization contact us at emily.artale@lotussustainability.com or hillary@merrillgroupllc.com.

What are solar gardens? Solar gardens consist of a large number of solar panels connected as an array and located on a large parcel of land. Government agencies, businesses, non-profits, and residences can buy a select number of solar panels from an array or purchase electricity generated by a select number of solar panels and receive credit, as utility incentives, on their electricity bills for the electrons that they own.

Why solar gardens?  As we all know, solar energy provides numerous environmental and financial benefits. There are a variety of mechanisms in which an organization or individual can acquire solar energy, and solar gardens are just one of the many options. Solar gardens make sense for entities that are unable or not prepared to host or own a system on their building’s roof or adjacent to their property.

Solar garden arrangements provide unique benefits including established operation and maintenance practices administered by a third party, the potential to avoid land management issues, the ability to transfer renewable energy to different premise locations, and ideal placement that can maximize the production output.

Understanding the risks and opportunities. As with any project, sustainable or otherwise, we recommend that you have a solid understanding of the risks and opportunities. To aid you in that analysis we have crafted four questions that we suggest you discuss with your solar garden developer, utility company, and/or a neutral third-party consultant before you sign a contract (usually 20 years).

1.     What is the role of REC payments and how will REC payments influence my sustainability and renewable energy goals?

2.     What reduction in electricity use and electricity costs could I expect to see on my bill?

3.     How are changes in electricity rates determined and how could future electricity rates impact my payback period and potential long-term savings?

4.     How are changes in future utility incentives determined and how could future utility incentives impact my payback period and potential long-term savings?

 What you can do. There are several approaches that you can take to better inform and prepare yourself before committing a solar garden membership:

• Understand your motivation for participating and make sure it aligns with your sustainability and energy goals.

• Discuss the questions listed above with your solar garden developer and utility company representative.

• Clearly understand your project proposal and all contract language.

• Conduct a utility bill analysis to better understand your utility rates and potential for change.

• Model your risk and various “what-if” scenarios.

We are available to conduct a neutral third-party technical analysis of your project proposal and we can help you evaluate the potential opportunities, risks, and various “what-if” scenarios for your solar garden project. For more information please contact us emily.artale@lotussustainability.com or hillary@merrillgroupllc.com.

Join us for our next webinar titled, “How to Set Effective and Measurable Sustainability Goals” on July 30th, 2014 at 12:00 p.m. MDT. To register please visit http://www.anymeeting.com/PIID=EA57D680844A3B

 This webinar is part of a series that discusses emerging topics in the sustainability and energy fields based on real-world consulting experience.

Authors

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Emily Artale, PE, CEM, LEED AP is Principal and Owner at Lotus Engineering and Sustainability, LLC, www.lotussustainability.com. She has been working in the industry for nearly a decade and she has a background in energy management, sustainability planning, and water quality. Emily helps teams develop action-oriented solutions that will improve efficiency and integrate sustainability into current processes. She received her undergraduate and graduate degrees in environmental engineering from the University of Colorado at Boulder. She is a Colorado native and spends most of her time outdoors with her family.

Hillary Dobos is Principal and Owner of Merrill Group, LLC, www.merrillgroupllc.com. Hillary brings both expertise and creative thinking to working with clients which she draws from her experience as a consultant advising public and private clients throughout the United States, as well as the one tasked with embedding sustainability throughout a 25,000+ person organization (Colorado State Government). Hillary earned her B.A. in Art History and Economics from Bowdoin College in Maine and her MBA from the University of Colorado-Boulder. Hillary was born and raised in Denver, Colorado, where she currently enjoys life with her husband, son, and moderately trained canine, Mr. Smiles.

Disclaimer: The information presented above is based on the opinions and experience of the authors. Additional information could become available from the solar garden developer and/or utility company that could impact the statements made above.