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McNeiece raises concerns with ESCO project

May 21, 2012

NARRAGANSETT—On Wednesday evening, The School Committee heard a report from Jeff Broadhead, Executive Director of The Washington County Regional Planning Council (WCRPC) regarding the recent energy saving program into which the town has engaged. The Town Council held a work session last Tuesday to address the town’s energy saving needs through the Energy Services Company project (ESCO).

 Last year, (WCRPC) collaborated with the town and, through its partnership with Johnson Controls, Inc. (JCI), an energy evaluation company, recently completed its audit of town facilities, assessing their energy efficiency and identifying potential areas for cost savings.

“A lot of people look at solar and wind, but the cheapest form of energy is that which you don’t’ use,” said Broadhead. “The basic premise of the program is that all sources of electricity pollute in some way or another, and it is best to simply not use that in the first place.” 

 “This project is about reducing he amount of energy municipal buildings use, and to do it in a cost-effective way.”

Representatives from JCI were on hand to explain in detail their Investment Grade Audit, a detailed report which determines the specific cost savings at the town’s facilities, namely Town Hall, the Towers, the garage at the Department of Public Works, and the Waste Water office. If the town decides to undertake the program, it will pay upfront, associated construction costs, but recoup that money spent through JCI’s energy saving figures outlined in the audit report.

 Although JCI is responsible for the construction bid and procurement process, independent of town influence, it also guarantees that their calculations of energy savings for town facilities will be met. If the town does not accrue the said amount of savings over a period of time, JCI will reimburse the town with the difference.

 “We started this process almost two years ago now, as part of the WCRPC’s program, which began as a rather ambitious project,” said Town Engineer Jeffry Ceasrine. “Once JCI was brought on board, they started building by building audits.”

“It took a long time to get to this stage, but that is just the nature of the beast, and the projects on the list make sense,” he added. “Boiler conversions, pipe insulation, ceiling insulation, they are all common sense. All in all, I think it is a worthy project.”

Broadhead spoke to the School Committee on Wednesday evening about its audit report for school buildings, a separate document that is still being prepared. According to state law, the School Committee is responsible for managing its own budget expenses, and thus an ESCO audit report must be reviewed by the Committee, although the program itself is counted together with the town’s energy audit.

Broadhead noted that miscalculations were identified during the audit review process, through which WCRPC hired a third party engineer to examine estimated cost figures. David Ward of Energy Efficiency and Design Services, Inc.,  an engineering firm based in  Framingham, Massachusetts, reviewed the estimated figures presented by JCI and determined they were significantly higher than market costs.

“[Ward] reduced JCI’s numbers by 40 to 70 percent,” said Broadhead. “Kathy Stanley of JCI was originally given the responsibility of organizing vendors’ response. They had to examine 13 clients with 140 buildings all at once, and they gave Kathy their numbers.”

 “Kathy was a salesperson, a good one, but not an engineer,” he added. “She said those were the numbers, and Jim Cotton, her boss and an engineer, said that they were too high. Kathy left and got another job while Cotton took over the project himself, went back to the vendors, and said that they were just throwing something against the wall.”

 In correspondence with Superintendent of Schools Katherine Sipala and the rest of the School Committee, Broadhead stated that a decision on whether they would participate in the ESCO project needed to be reached soon because grant monies for the town’s energy program will run out by September 2013, money which will not be available to help fund the program’s upfront construction costs. McNeiece expressed concern that the School Committee was being rushed into participation without reviewing the audit report.

 “I don’t have a lot of confidence in the process because [JCI] overextended itself in taking on too many projects,” said McNeiece. “It is unsettling to hear that prices are high, someone left and now prices are 40 to 70 percent less, and now we’ll give you a 10-page report to pick the projects to go with.”

 Both Broadhead and Sipala noted that the School Committee has to only decide to participate and tentatively identify one project for the ESCO program in order that the town can move forward and meet their September 13 deadline.

“[The School Committee] can say, 'We don’t’ know’, and the town can reserve money to move forward,” said Broadhead. “It can still use that money at a later date.”

 “The work that the town has to do must be done before September, and they need to make decisions very soon on how to spend their dollars,” said Sipala. “Our projects can happen later. I am willing to move [the ESCO project] through and keep the School Committee informed. We are appreciative that the Town Manager will work with us to move forward.”

Broadhead further stated his case for the School Committee’s participation in the ESCO program, noting that Ward has been a trusted consulting party on previous ESCO projects and that the energy and cost saving benefits it will bring to the town outweigh its technical issues.

 “It is really not that inflated,” said Broadhead. “We requested so many prices in such a short time that our contractor had to simply pass on his contracting prices. Then we started looking at the prices, and the reason we had a third party engineer was because we knew we had to look at the prices. I will not recommend a project to a school unless the prices make sense.”

“We are just taking the initial numbers and looking at them out in the open,” he added. “Dave Ward has been his own for 20 years, representing municipalities on ESCO projects for years. He is top-notch, which is why we hired him. We are doing everything we can [to find] the best prices you can get.”

The Town Council is scheduled to make a decision regarding its participation in the ESCO project at the June 4 or 8 regular meeting, at which time the School Committee will have come to its decision as well.

Southern Rhode Island Newspapers
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