CITY OF ELK GROVE CITY COUNCIL STAFF REPORT

Transcription

1 CITY OF ELK GROVE CITY COUNCIL STAFF REPORT AGENDA ITEM NO AGENDA TITLE: Receive Update on Citywide Light Emitting Diode (LED) Streetlight Conversion and Provide Guidance on Next Steps MEETING DATE: March 25, 2015 PREPARED BY: DEPARTMENT HEAD: Jeff Werner, Senior Civil Engineer Rick Carter, Capital Program Manager Richard Shepard, Director of Public Works RECOMMENDED ACTION: City Council to receive update on citywide light emitting diode (LED) streetlight conversion and provide guidance on proposed approach to retrofitting decorative streetlights. BACKGROUND INFORMATION: The City of Elk Grove first began converting its streetlights to energy efficient LED technology in Using a Department of Energy (DOE) grant, the City installed 163 total LED streetlights on Elk Grove Boulevard and Laguna Boulevard. Energy savings from the project resulted in a reduction in the City s annual streetlight and maintenance bills. Public feedback about the LED lights was largely positive. Given the success of the city s initial project, the city has pursued upgrading all streetlights. In late 2013, staff performed a financial analysis for a project to convert all City streetlights to LED. Preliminary estimates showed a total up front capital cost of $5 million was necessary to implement the project with an expected return on investment (ROI) or payback period of 11 years. In early January 2014, the City began a pilot study to test a variety of LED streetlight brands and configurations and gather public feedback. Concurrent with the pilot study, the City began developing specifications for a LED streetlight purchasing agreement. Staff worked closely with the Sacramento Metropolitan Utility District (SMUD) throughout both processes to develop the specifications. SMUD also agreed to contribute up to $300,000 in incentives for completing the citywide conversion. 1

2 Elk Grove City Council March 25, 2015 Page 2 of 3 After six months of observation, analysis, and consideration of public feedback, an invitation for bids for the purchasing contract was issued in July A contract was awarded to the lowest responsive and responsible bidder Walters Wholesale Electric Company in August However, analysis of the bids also revealed that the total purchase price for the City s complete inventory of existing streetlights exceeded the $5 million total estimated project cost. This was due to the significant cost for decorative type fixtures above what was anticipated. When estimating the purchase price for the decorative fixtures, staff identified a wide range in costs, from as little as $110 to as high as $1,000 per decorative fixture. This range occurs because there is a significant difference in the cost of retrofitting existing fixtures versus the cost for full replacement. Original estimates assumed that retrofitting existing decorative fixtures was an acceptable alternative; therefore, project costs were estimated at the lower end of the price range. However, after consultation with SMUD regarding their incentive/rebate program, it was determined that none of the available retrofit options were eligible for the rebate and only full replacement options were eligible. Therefore, the City moved forward with listing only the eligible complete replacement options. Given the budget constraints and an ROI greater than the 11 years anticipated by the City s interfund loan, the citywide conversion project was broken into two phases. Phase 1 would convert 9,856 non-decorative streetlights, which have a ROI less than 11 years, and Phase 2 would convert the City s approximately 2,500 decorative streetlights assuming a reasonable ROI can be found. Phase 1 was completed on January 30, The project was finished two months ahead of schedule, allowing the City to achieve the full $300,000 SMUD incentive contribution with just Phase 1. The project results are still being analyzed, but the preliminary estimates show that the City s overall energy consumption for the approximately 10,000 lights converted was reduced by more than 60%, exceeding the initial estimate of 50% savings. This translates to approximately 4.6 million kilowatt-hours annually and nearly $300,000 in annual energy bill savings. In addition to the annual power savings, it is anticipated that there will be a reduction in annual maintenance costs of approximately $100,000 due to the lower failure rate of LED fixtures as compared to the existing High Pressure Sodium fixtures. Total annual savings for Phase 1 is estimated to be $400,000. 2

3 Elk Grove City Council March 25, 2015 Page 3 of 3 The total cost for Phase 1 was nearly $4.0 million. To implement Phase 2 within the remaining $1 million budget to ensure a similar or better payback period, a less expensive alternative for the decorative fixtures is warranted. This option comes in the form of universal LED retrofit kits. Universal LED retrofit kits are LED products designed to work within existing streetlight fixtures by simply replacing the existing lamps, thereby preserving the existing streetlight housing and lenses. Costs are saved by preserving the existing materials; thus, retrofit kits are up to ten times less expensive than full replacement of the streetlight fixture. The retrofit kits are more viable than full replacement with new fixtures given the significant difference in cost and the quality of improved technology. Beginning January 2015, prototype retrofit kits have been evaluated to ensure the retrofit bulbs properly fit, adequately distribute light, have acceptable color, and operate and perform acceptably. To date, three different retrofit kits have been installed and analyzed in the City. This analysis has already revealed that one of the City s decorative fixture types (Zone 2, Type B ) cannot be retrofitted with a universal retrofit kit due to an internal reflector that limits light shining upward into the night sky. There are approximately 600 of this fixture type being used in the City. The primary manufacturer of this fixture type offers a retrofit kit for this model that is more expensive than a typical universal retrofit kit, but is still less expensive than a full replacement option. Staff believes the manufacturer s model is the viable alternative for this fixture type. The three universal retrofit options being evaluated range from $110 up to $190 in typical sales price and the single retrofit kit for the Zone 2, Type B fixture sells for $240 on average. At the average prices of $150 and $240 each, the total cost to implement Phase 2 using available and preferred retrofit kit options is estimated to be approximately $990,000 which is within the remaining project budget. FISCAL IMPACT The total appropriation for the Citywide LED Streetlight Conversion is $5 million. Staff anticipates the final total cost of Phase 1 to come in at nearly $4 million, leaving approximately $1 million for implementation of Phase 2. ATTACHMENTS: 1. Diagram of Fixture Types 2. Before and After Photos 3

4 ATTACHMENT 1 Phase 1 Fixtures Phase 2 Fixtures 4

5 5 ATTACHMENT 2 AFTER BEFORE REDUCED SKY GLOW BARTHOLOMEW SPORTS PARK BARTHOLOMEW SPORTS PARK AUTO MALL AUTO MALL LED STREETLIGHT CONVERSION

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