|
ITEM 4 |
City Council Memorandum City Manager's Office Memo No. N/A
|
Date: |
April 4, 2024 |
To: |
Mayor and Council |
Thru: |
Joshua H. Wright, City Manager Dawn Lang, Deputy City Manager - CFO |
From: |
Steven Turner, Sustainability & Performance Officer |
Subject: |
Agreement No. CM3-290-4552, Amendment No. 1, Solar Installations at Various Facilities |
|
|
|
Proposed Motion: |
Move City Council approve Agreement No. CM3-290-4552, Amendment No. 1, with Ameresco, Inc., for solar installations at various facilities, to proceed with Milestone 2 of the Scope of Services. |
Background/Discussion: |
In 2023, the Chandler City Council took a significant step forward by integrating Sustainability & Technology into its Strategic Framework. This decision underscored the city's commitment to advancing smart energy solutions aimed at reducing service costs and enhancing environmental resilience. The first step to accomplish this goal was to conduct a solar feasibility study. On July 20, 2023, the City Council approved an agreement with Ameresco for Milestone 1 to complete the solar feasibility study. The purpose was to explore various solar installation options, including ground-mounted, roof-mounted, and solar-covered parking configurations across 25 municipal facilities. The deliverables of this first phase included: • Develop preliminary site layouts and recommend optimal mounting solutions. • Estimate photovoltaic production potential and the percentage of energy consumption offset. • Provide cost estimates for engineering, procurement, and construction. • Recommend ownership and pricing models, leveraging benefits such as those outlined in the Inflation Reduction Act. As part of Milestone 1, the following sites were evaluated: Airport Water Reclamation Facility (AWRF) Ocotillo Water Reclamation Facility (OWRF) Pecos Water Treatment Facility City Hall Fire Administration Building Public Works & Development Services Building Information Technology Building Chandler Nature Center Chandler Heights Substation Public Safety Training Facility Parks & Facilities Service Center McQueen Yard Sunset Library Delaware Parking Lot (Not included in recommendation due to the shape of the parking lot) Fire Stations 1-11 (Fire Station 4 not included in recommendation because it is scheduled to be rebuilt within five years in the current Capital Program) In December 2023, Ameresco concluded the solar feasibility study, identifying 23 city facilities as suitable locations for solar infrastructure. The proposed project promised to generate over 9 megawatts of power, offsetting approximately 56% of the energy consumed by these facilities. This agreement for Milestone 2 is to complete all required engineering on the properties identified during the solar feasibility study, which is estimated to take approximately five months. Upon completion, a final contract for solar construction will be presented to the City Council. The subsequent installation process across all 23 sites is anticipated to take approximately 10 months before the solar systems are fully operational. On March 7, 2024, the City Council Sustainability and Technology Subcommittee convened to deliberate the outcomes of the solar feasibility study. Various financing options were discussed, with emphasis placed on utilizing one-time revenue to generate ongoing savings. The Subcommittee directed staff to propose the $10 million down payment option, but if possible, increase the down payment as part of the FY 2024-25 proposed budget. The current draft Capital Program for FY 2024-2025 includes up to $15 million as a capital investment amount, promising approximately $1.4 million in savings annually from year one. Over the span of 20 years, the city stands to save over $28 million, increasing to over $41 million after 25 years. Approximately 70% of the savings will accrue to the utilities funds (60% Wastewater and 10% Water), with the remaining 30% allocated to the General Fund. As such, the utilities enterprise funds will cover 70% of the down payment. The estimated cost for the engineering services detailed in milestone two amounts to $1,820,507. It is important to note that this cost will be integrated into the overall expenses of the construction phase of the project. Consequently, Milestone 2 does not necessitate an immediate or separate payment. |
Evaluation: |
On July 20, 2023, City Council approved an agreement with Agreement No. CM3-290-4552, with Ameresco, Inc., for solar installations at various facilities. The Contractor has completed Milestone 1 of the Scope of Services. Staff recommends proceeding with Milestone 2. |
Financial Implications: |
In the event that the city decides not to proceed with the construction of the solar panels on these city facilities, the city will pay the Contractor the cost of the services of milestone two in the amount of $1,820,507. |
|
Fiscal Impact |
|
|
|