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Item No. 3.
| MEETING DATE: 04/18/2022 |
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| TO: | HONORABLE MAYOR AND COUNCILMEMBERS |
| FROM: | JIM SADRO, CITY MANAGER By: Elias Saykali, Public Works Director |
| SUBJECT: | APPROVE AGREEMENT WITH SOUTHERN CALIFORNIA EDISON FOR LED STREETLIGHT UPGRADES VIA THE SCHEDULE LS-1 OPTION E PROGRAM
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RECOMMENDATION:
That the City Council approve and authorize the City Manager to execute Schedule LS-1 Option E Energy Efficient Fixture Replacement Rate Agreement with Southern California Edison (SCE) Company to retrofit all SCE-owned streetlights in La Habra from High-Pressure Sodium Vapor (HPS) lamps to Light Emitting Diode (LED) Technology.
DISCUSSION:
Southern California Edison (SCE) owns and maintains approximately 2,536 streetlights throughout the City of La Habra (City), presently utilizing high pressure sodium (HPS) lamps. SCE charges the City with a monthly fee, known as an LS-1 tariff, to provide electricity as well as operations and maintenance for each fixture. As the owner of the lights, SCE provides all maintenance, including lamp replacements, troubleshooting, and replacement following accidental knockdowns.
Light emitting diode (LED) lamps are more energy efficient and can produce as much as twice the amount of light produced by HPS lights, depending on the brightness desired by the City. The conversion to LED lamps results in less electricity use, reduced greenhouse gas emissions, and lower electricity costs to the City. Under SCE's Option "E" program a municipal customer, such as the City of La Habra, may enter into an agreement with SCE to fund the retrofit cost of new LED lights through an Energy Efficiency Premium Charge (EEPC) that would be added to the City's existing street lighting bill. The EEPC fee is designed to pay SCE for the capital cost to replace all the existing lights with LED hardware over a 20-year period and is funded through the savings from reduced electricity costs to the City, after which the City would still realize a cost savings of approximately $86,603 per year in reduced streetlight electricity bills.
It should be noted that, since July 2021, SCE has also provided the City with a discount based on streetlights mounted on distribution poles (the DPSLD Program). The DPSLD Program discount is currently applied to electricity costs associated with 588 streetlights at select locations in La Habra, generating a total of $31,469 in annual savings to the City. The DPSLD Program discount was provided to the City at no cost and will continue after, and in addition to, any savings realized through the City's participation in the SCE Option E program.
Color and Brightness of Streetlights.
The proposed change of street lighting from HPS to LED will impact the visual appearance of the lighting throughout town, most notably related to the color of the light produced by the new LED bulbs. Lower temperatures produce a redder light, medium temperatures produce a whiter light, and higher temperatures produce a bluer light. While the City has some discretion over the brightness setting for the new LED lights, SCE recommends that for these types of projects the City use General Electric (GE) Evolve LED light fixtures that produce a 3,000K color temperature light, which are considered “warm white" light, and which have more yellow and amber tones than the 2,300K HPS lights currently in use in the City. SCE staff advised that this is light level that most cities opt for when converting to LED.
SCE's inventory of streetlights in La Habra contains lights that range from 50 watts to 400 watts, with the vast majority of them (approximately 71%) being 70 watts, which are also the most prevalent streetlight found in residential neighborhoods. If approved by Council, these lights will be replaced with 31-watt LED fixtures that will project a similar level of brightness; however, with a slightly different color appearance. Brighter 200-watt lamps currently deployed along main arterials and busier roadways will be replaced with an 82-watt LED. The brightness of these LEDs will be similar to existing HPS lights now found along arterials, but brighter than the 31-watt lamps LEDs that will be deployed in residential neighborhoods.
The proposed LED light fixtures are designed to direct light in specific directions, toward the street and sidewalk, reducing the amount of light "spillover" directed toward properties. This is intended to mitigate concerns related to light intrusion into neighboring properties. Additional light shielding can be considered and installed on case by case basis to further reduce concerns related to lighting at specific locations throughout the City. This additional mitigation tactic is not designed into the initial rollout of the project, but will be considered once installation is completed, based on resident feedback or concerns. As part its ongoing responsibility for maintenance of the streetlight system, SCE will respond to customer concerns and will provide remedies that are customized on a per location basis, rather than try to implement a “one-size fits all” solution.
Reduced Electricity Usage and Lower Greenhouse Gas Emissions.
Streetlight energy consumption in La Habra is approximately 1,368,383 kWh per year. This amount of energy consumption produces approximately 653 tons of carbon dioxide (CO2) greenhouse gas emissions (GHG) equivalent per year. With implementation of the Option E program, the City's estimated annual streetlight energy consumption will decrease to 359,939 kWh per year, yielding a reduction of GHG emissions to 172 tons of CO2 equivalent per year, a drop of approximately 70% of CO2 equivalent release per year. This reduction is the equivalent of taking 94 cars taken off the road each year or an amount equivalent to the annual energy consumption of 55 homes. The SCE Option E Agreement has been reviewed by City staff and the City Attorney’s office and, based on the energy and cost savings being proposed by SCE, staff recommends Council approval of the Option E Agreement.
Light emitting diode (LED) lamps are more energy efficient and can produce as much as twice the amount of light produced by HPS lights, depending on the brightness desired by the City. The conversion to LED lamps results in less electricity use, reduced greenhouse gas emissions, and lower electricity costs to the City. Under SCE's Option "E" program a municipal customer, such as the City of La Habra, may enter into an agreement with SCE to fund the retrofit cost of new LED lights through an Energy Efficiency Premium Charge (EEPC) that would be added to the City's existing street lighting bill. The EEPC fee is designed to pay SCE for the capital cost to replace all the existing lights with LED hardware over a 20-year period and is funded through the savings from reduced electricity costs to the City, after which the City would still realize a cost savings of approximately $86,603 per year in reduced streetlight electricity bills.
It should be noted that, since July 2021, SCE has also provided the City with a discount based on streetlights mounted on distribution poles (the DPSLD Program). The DPSLD Program discount is currently applied to electricity costs associated with 588 streetlights at select locations in La Habra, generating a total of $31,469 in annual savings to the City. The DPSLD Program discount was provided to the City at no cost and will continue after, and in addition to, any savings realized through the City's participation in the SCE Option E program.
Color and Brightness of Streetlights.
The proposed change of street lighting from HPS to LED will impact the visual appearance of the lighting throughout town, most notably related to the color of the light produced by the new LED bulbs. Lower temperatures produce a redder light, medium temperatures produce a whiter light, and higher temperatures produce a bluer light. While the City has some discretion over the brightness setting for the new LED lights, SCE recommends that for these types of projects the City use General Electric (GE) Evolve LED light fixtures that produce a 3,000K color temperature light, which are considered “warm white" light, and which have more yellow and amber tones than the 2,300K HPS lights currently in use in the City. SCE staff advised that this is light level that most cities opt for when converting to LED.
SCE's inventory of streetlights in La Habra contains lights that range from 50 watts to 400 watts, with the vast majority of them (approximately 71%) being 70 watts, which are also the most prevalent streetlight found in residential neighborhoods. If approved by Council, these lights will be replaced with 31-watt LED fixtures that will project a similar level of brightness; however, with a slightly different color appearance. Brighter 200-watt lamps currently deployed along main arterials and busier roadways will be replaced with an 82-watt LED. The brightness of these LEDs will be similar to existing HPS lights now found along arterials, but brighter than the 31-watt lamps LEDs that will be deployed in residential neighborhoods.
The proposed LED light fixtures are designed to direct light in specific directions, toward the street and sidewalk, reducing the amount of light "spillover" directed toward properties. This is intended to mitigate concerns related to light intrusion into neighboring properties. Additional light shielding can be considered and installed on case by case basis to further reduce concerns related to lighting at specific locations throughout the City. This additional mitigation tactic is not designed into the initial rollout of the project, but will be considered once installation is completed, based on resident feedback or concerns. As part its ongoing responsibility for maintenance of the streetlight system, SCE will respond to customer concerns and will provide remedies that are customized on a per location basis, rather than try to implement a “one-size fits all” solution.
Reduced Electricity Usage and Lower Greenhouse Gas Emissions.
Streetlight energy consumption in La Habra is approximately 1,368,383 kWh per year. This amount of energy consumption produces approximately 653 tons of carbon dioxide (CO2) greenhouse gas emissions (GHG) equivalent per year. With implementation of the Option E program, the City's estimated annual streetlight energy consumption will decrease to 359,939 kWh per year, yielding a reduction of GHG emissions to 172 tons of CO2 equivalent per year, a drop of approximately 70% of CO2 equivalent release per year. This reduction is the equivalent of taking 94 cars taken off the road each year or an amount equivalent to the annual energy consumption of 55 homes. The SCE Option E Agreement has been reviewed by City staff and the City Attorney’s office and, based on the energy and cost savings being proposed by SCE, staff recommends Council approval of the Option E Agreement.
FISCAL IMPACT/SOURCE OF FUNDING:
Southern California Edison has estimated that conversion of their 2,536 streetlights to LED in La Habra will cost $960,122, at an average cost of approximately $379 per light. This cost includes furnishing all materials and labor to complete the lighting retrofits. This cost would be passed on to the City to pay and would be recovered by SCE through an Energy Efficiency Premium Charge (EEPC) on the City’s monthly electricity bill. By doing so, SCE can amortize what essentially becomes a zero-percent loan to the City, amortized over a 20-year term.
Despite the addition of the EEPC to fund the retrofits, the reduced electricity consumption would still result in the City saving a considerable amount in electricity charges per year for streetlight usage. Based on current rates, SCE projects the City will save approximately $134,609 per year in electricity costs after the LED conversion is completed. Even after factoring in the additional costs of the EEPC charge, the SCE is estimating that the City could save up to $86,603 per year in electricity costs, as shown in the table below:
Despite the addition of the EEPC to fund the retrofits, the reduced electricity consumption would still result in the City saving a considerable amount in electricity charges per year for streetlight usage. Based on current rates, SCE projects the City will save approximately $134,609 per year in electricity costs after the LED conversion is completed. Even after factoring in the additional costs of the EEPC charge, the SCE is estimating that the City could save up to $86,603 per year in electricity costs, as shown in the table below:
| Estimated Annual Energy Cost Savings | $134,609 |
| Annual EEPC cost | -$ 48,006 |
| Net Annual Savings | $ 86,603 |
At the conclusion of the EEPC payback period, it is estimated that the City's annual cost savings will increase to $134,000 or more per year, assuming future electricity rate increases are consistent with historic averages. In the event electricity rates increase at a greater than average rate, there is a potential for greater cost savings. The Fiscal Year 2021-22 Traffic Management budget allocates $522,997 for Street Lighting Electricity, $511,000 (97.7%) of which goes to pay for the cost of SCE-owned streetlights. Annual cost savings from participation in the Option E program would reduce those costs by $86,609 (based on current electricity rates), equal to reducing the FY 2021-22 program electricity expenses by approximately 16.9%.
GENERAL PLAN RELEVANCE:
AQ 1.2 Greenhouse Gas Emission Targets.
AQ 2.8 Emissions Reduction.
ED 9.1 Balanced Fiscal Practices.
AQ 2.8 Emissions Reduction.
ED 9.1 Balanced Fiscal Practices.