U.S. Chamber of Commerce

Transcription

1 U.S. Chamber of Commerce Energy Efficiency through Performance Contracts John Mahoney Senior Vice President Chevron Energy Solutions A Division of Chevron U.S.A. Inc. April 21, 2011

2 Long-Term Global Energy Demand Global demand will rise roughly 40% through 2030 Global Energy Demand Million Tonnes of Oil-Equivalent Renewable & Other Nuclear Coal Natural Gas Oil Source: IEA World Energy Outlook

3 We Need It All It s an and world Conventional and unconventionals Oil, gas, coal and nuclear and alternatives and renewables Geothermal, solar, wind and biofuels and energy efficiency The easiest, most cost effective and reliable form of new energy available today 3

4 Background on Energy Services Industry and Energy Service Companies (ESCOs) and Performance Contracting ESCOs originally formed in the 1970s and early 1980s in response to rising energy prices Develop, engineer and install Energy Savings Performance Contract (ESPC) projects that improve energy efficiency and lower maintenance costs U.S. energy services market estimated to be around $5.6 billion (Pike Research, 1Q 2010) Ranges from small regional companies to divisions of large multi-billion dollar companies 4

5 Background on ESCOs and ESPC Projects Generally act as project developers Assume project technical and performance risk requires measurement, monitoring and verification of energy savings Project compensation verifiable energy and operational savings Projects reduce energy demand energy efficiency, conservation and load management Services and technologies bundled into total cost and repaid through energy and operational savings generated 5

6 What Is Energy Savings Performance Contracting? Uses energy and operational savings to fund capital improvements No up front costs Innovative, proven procurement solution to funding building improvements 6

7 More on Energy Savings Performance Contracting PROGRAM BENEFITS Cost Savings Customers can realize savings of 15% 35% from the installation of energy-efficient equipment. Better Infrastructure Updated systems reduce maintenance, operations and energy costs, and harmful emissions. Improved Environment Building occupants enjoy improved lighting, better air quality and more comfortable temperatures. Studies show that improved occupant comfort increases overall productivity. Budget Flexibility Performance contracting savings can be redirected for other facility projects or critical operating needs such as school books, computers or new production lines. 7

8 Potential benefits of utilizing the entire Federal Super ESPC $80 billion contracting authority $21 billion in net savings to the U.S. Government Fort Detrick, Maryland $32 billion of avoided federal expenditures on infrastructure and equipment Energy savings of 6.8 Quads (about 1.2 billion barrels of oil on a barrel of oil equivalent basis) Creation of 527,000 job-years The emission reduction equivalent of taking approximately 10,000,000 cars permanently off the road. John Shonder and Bob Slattery at ORNL performed the analysis at the request of Skye Schell of DOE s FEMP program 8

9 Energy Performance Contracting Works Within Existing Budget Improvements are self-funded and guaranteed. 9

10 Energy Performance Contracts: Potential Financing Structures Tax Exempt Lease Purchase Tax Exempt Bonds Shared Savings Contracts Commodity Off-take Agreements Operating Lease Power Purchase Agreements Tax Credit Bonds Lease/ Leaseback 10

11 Typical Energy Conservation Measures and Energy Retrofits Lighting Building automation systems and temperature controls Smart meters Heating ventilating and air conditioning (HVAC) upgrades Electrical distribution upgrades Motors and variable frequency drives Water conservation and water fixtures Data Center consolidate Lab retrofits Window and building envelope Distributed on-site generation 11

12 Chevron Energy Solutions: Efficiency, Reliability, Renewable Power Lighting & HVAC Energy Controls Solar Fuel Biomass Cogeneration Develop, engineer and construct energy-efficient facilities and power system projects for institutions and businesses, including Chevron A viable energy services company 350 professionals in two dozen locations across the U.S. First in the oil and gas industry Most projects funded by energy savings and government economic incentives 12

13 Our Primary Markets U.S. Institutions Military bases Federal agencies Postal Service Public Sector Institutions Schools, colleges, universities Local/state governments Correctional facilities Wastewater treatment facilities Chevron Refineries Exploration and production facilities Pipelines and other facilities Fort Detrick, Frederick, MD 13

14 Benefits of CES Projects Lower demand for purchased power, reduce greenhouse gas emissions Improve public facilities and save taxpayer dollars Mitigate exposure to volatile energy costs Provide market access for emerging clean energy technologies Increase energy efficiency and conservation (CES projects average 30% reduction in energy) 14

15 U.S. Postal Service First fuel cell/solar renewable power plant in the U.S. With efficiency upgrades, U.S. Postal Service saves $1.23 million annually (46% reduction in electricity purchases) Inside: Energy efficiency Outside: Solar and fuel cell 15

16 State of Colorado $20 million 20 buildings 1.8 million sq ft Energy efficiency, solar and geothermal project 16

17 University of Utah Project Project Phases I VI (approximately $64 MM) Savings by Retrofit Type 4% 18% 20% 58% Water, Motors, Other Controls Mechanical Lighting Key Technologies Installed Since implementing Phase I in 1998, the University of Utah has saved millions of dollars in energy costs and has leveraged those savings to construct two central utility plants to meet the needs of a growing campus. Energy-efficient lighting New chillers and cooling towers HVAC systems with variable-frequency drives and motors Low-flow aerators for sink faucets, low-flow toilets Construction of a new 6800-ton chilled water plant Construction of a new 210-mmBTU hightemperature hot water plant 17

18 Energy efficiency, reliability and renewables in Chevron Energy Efficiency: San Joaquin Valley California Power Distribution Upgrade: Angola Energy Efficiency, Renewable Power: Richmond Refinery California 18

19 Questions Answers 19