|Why Just ESCO'S?
July 11, 2001
Dear Isiah and Rich:
With regard to the meeting of the Energy Committee on Monday of this week, I believe we all agree on the following challenging objectives:
1. We need to implement cost-effective energy conservation measures as soon as possible.
2. We need to take full advantage of any grants or rebates while they are still available.
3. The City of Richmond does not currently have the staff or capability to manage a multi-faceted energy conservation program within the time constraints that we feel we have to act. We will have to depend on outside help to evaluate needs and opportunities, be familiar with grants and subsidy programs, prepare applications, and design and manage projects.
Based on the meeting on Monday, the staff response to this challenge was to place before the Energy Committee three unsolicited presentations from ESCO’s with no RFP stating the City’s objectives, no evaluation of the cost-effectiveness of the services offered, no objective evaluation of the experience and qualifications of the companies and no information obtained from contacting their current and former customers. In my experience on the City Council, this was an unprecedented approach to selecting a contractor that anticipates doing several million dollars of construction work under a contact that could bind the City for 10 to 20 years. I will refrain from going so far as to characterize it as irresponsible.
What disturbs me most, however, is the policy conclusion that the way we want to attack energy conservation is to hire an ESCO. We were never given an opportunity to consider any other alternative. I have, for he last four years, proposed two alternatives that have never been taken seriously. One is to hire a consulting firm that will provide the same services as an ESCO, satisfy all three of the objectives listed above and, ultimately cost the City 35% to 50% less. The other, which can be accomplished in concert with the first, is to avail ourselves of all the free services offered by the California Energy Commission Energy Partnership Program (http://www.energy.ca.gov/efficiency/partnership/index.html), the U.S. Department of Energy Rebuild America Program (http://www.eren.doe.gov/buildings/rebuild/) and PG& E. One of the gateways to these and other programs is the Local Government Commission (http://www.lgc.org/energyclearinghouse/index.html), of which we are a member. I might add that the LGC is sponsoring a conference for local elected officials on this very thing September 7-9. You can get information from Erin Hauge of the LGC at 916/448-1198. I would encourage Richmond to be represented.
I am compiling a list of consulting firms that can provide the services we need at a fraction of the cost of an ESCO, and I will try to have them available to you in a day or so. One example is ICF Consulting (http://www.icf-infotech.com/), which like the ESCO’s we heard from, is a multi-national firm with local offices.
I believe that to focus exclusively on ESCO’s to solve our problems would be fiscally and politically irresponsible. I hope that you will evaluate, along with ESCO’s, the opportunity to utilize the combination of free services and consulting firms that I have suggested. I hope to hear back from you on this soon.