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Morgantown energy savings contract exceeding guarantees

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Subject to independent verification, Morgantown's guaranteed energy savings performance contract performed well in its second year, bringing cumulative savings of $36,000 more than the guaranteed amount so far.

"We're very happy with the results," said City Manager Jeff Mikorski. "Our energy conservation projects have performed above what they were expected to perform."

The city has saved $528,000 in energy costs and operations and maintenance through 2012 related to contracted efficiency measures installed in 2009, according to a second-year report submitted to the city by Pittsburgh-based contractor Constellation.

A guaranteed energy savings performance contract is an arrangement in which a consultant identifies, through an energy audit, investments that would create energy savings sufficient to pay for the investments over a reasonable period — and then continuing into the future.

The consultant puts up a bond to guarantee the minimum savings.

Morgantown contracted with Constellation in 2009.

The city paid for the new measures, installed beginning in August 2009, under a capital lease totaling $2.8 million, with an expected total cost, with interest, of $3.8 million. Constellation guaranteed savings of that amount, through reduced electricity, fuel and water use, over 15 years.

Initial guaranteed savings of $71,000 were achieved during the installation period. When annual measurement began with the 2011 calendar year, savings of $225,000 exceeded guaranteed savings of $201,000.

The 2012 savings of $232,000 exceeded guaranteed savings of $220,000, and brought the cumulative savings over and above the guaranteed level to $36,000.

Most of the 2012 savings, $120,000, came from lighting upgrades. Nearly $50,000 came from automatic temperature control upgrades, and about $12,000 are attributed to a new insulated metal roof on the city's maintenance building.

HVAC and boiler modifications, a new chiller at the ice rink and other smaller modifications contribute the rest of the 2012 savings.

Constellation does its own measurement and verification. The city's Green Team — a volunteer group that advises the city on reducing energy consumption and harnessing alternative energy sources — examined the city's energy bills and confirmed Constellation's first-year analysis; it will do the same for the second year's analysis, Mikorski said.

Morgantown's budget is about $22 million.

The city has undertaken other efficiency and alternative energy projects, he said, included achieving Leadership in Energy and Environmental Design certification for the most recent fire station it built and putting solar panels on its farmers' market pavilion.