EXHIBIT 10.87
ENERGY SERVICES AGREEMENT FOR:
ENERGY CONSERVATION SERVICES AGREEMENT NO. 97-031-A
NORTHERN STATE MULTI-SERVICE CENTER
SEDRO XXXXXXX, WASHINGTON JANUARY 27, 1997
The owner and the Energy Services Company (ESCO) named below do hereby enter
into an agreement under terms described in the following sections:
Authorization (this sheet)
Project Conditions
Conditions of the Energy Services Agreement
AUTHORIZATION TO PROCEED
Energy Services Company Owner: Department of General Administration
Firm Onsite Energy Corporation Division of Property Development
Address 00000 Xxxxx Xxxxxx Xxxxxxx, Xx. 000 acting through the Department of
Xxxxxxx, Xxxxxxxxxx 00000 General Administration
Division of Engineering
Phone (000) 000-0000 & Architectural Services
BY /s/ Xxxxxxx X. Xxxxxxxx BY /s/ X. X. Xxxxxxxx
NAME NAME XXXXXXX X. XXXXXXXX
TITLE TITLE Energy Program Manager
DATE DATE
State of Washington Revenue Registration Number XXXXXXX000X0
Federal Tax Identification Number 00-0000000
PROJECT CONDITIONS
RECITALS:
WHEREAS, Owner own or leases the Facility;
WHEREAS, ESCO provides certain services and equipment intended to reduce Energy
and Utility Consumption in buildings and facilities;
WHEREAS, ESCO will have made a preliminary assessment of the Energy Consumption
characteristics of the Facility and has expressed a willingness to provide
certain services and equipment, all as described in the Energy Services
Proposal to be attached hereto.
WHEREAS, ESCO is willing to be compensated for ESCO Services and ESCO Equipment
out of Energy Cost Savings; Utility Payments; and/or through Lease/Purchase
Arrangements;
NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, it is agreed that:
The ESCO shall provide Energy Services called for in Section 2 of the
"Conditions of the Energy Services Agreement" for:
Agreement No. 97-031 A
Project Title: Energy Conservation Services
Facility Name: Northern State Multi-Service Center
Facility Address: Sedro Xxxxxxx, Washington
A. COMPENSATION FOR ENERGY SERVICES
As Compensation for developing and submitting a written Energy Audit Report and
Energy Services Proposal, the ESCO shall be reimbursed in accordance with
Section 2.B., 2.C., and 2.D. of the Conditions of the Energy Services
Agreement.
Compensation for the audit phase and Energy Services Proposal(s) is based on
the ESCO's Proposal dated January 14, 1997 with attached list of facility
buildings and audits and shall not exceed:
Boiler Plant Automation $11,000
Buildings on List $41,000
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TOTAL $52,000
PROJECT CONDITIONS
A. COMPENSATION FOR ENERGY SERVICES (CONTINUED)
There shall be separate Energy Services Proposals for the Boilers and the rest
of the facility.
In the event that the ESCO fails to conduct a Detailed Energy Audit or fails to
present to the Owner a written Energy Services Proposal within the time
specified in Section B. of these Project Conditions and does not propose to
finance the ESCO Equipment, the Owner may terminate the Energy Services
Agreement.
Notwithstanding the attached Conditions of the Energy Services Agreement ("the
Conditions") it is the understanding of the parties that all of the payments to
the ESCO are dependent on energy savings grants, loans, and/or incentive
payments from utilities and other Funding Sources and that ESCO shall be paid
in accordance with the provisions of Section 5, paragraph B of the Conditions.
It is also the understanding of the parties that the Owner desires that ESCO
guarantee Energy Savings and that ESCO provide ongoing monitoring services and
that the cost of such guarantee and monitoring shall be paid using Energy
Savings.
In the event that the Owner elects to finance the project in whole or in part,
Owner reserves the right to amend the terms, or to add new terms, to the
Conditions that Owner deems necessary to obtain financing.
ESCO fees for Owner financed project shall not exceed:
8% of labor and materials for mechanical and control design
6% of labor and materials for lighting and efficient motor design
4% of labor and materials for construction management
4% of labor and materials for bonding
15% of labor and materials for overhead and profit
Monitoring phase shall not exceed:
8% of savings for annual savings guarantee and engineering services commencing
in year two.
The first year guarantee of savings in included in the ESCO's overhead and
profit.
PROJECT CONDITIONS
B. SCHEDULE FOR ENERGY SERVICES PROPOSAL COMPLETION
Energy Services Proposal for the boiler project is due within 60 calendar days
after Authorization to Proceed. Energy Services Proposal for the building
portion of the project is due within 90 calendar days after Authorization to
Proceed.
C. COST EFFECTIVENESS CRITERIA
The following criteria will be used by the Owner and the ESCO to determine the
Cost Effectiveness of Energy Conservation Measures (ECM's) proposed in the
Energy Services Proposal:
1. Boilers
a) The ESCO must propose a boiler system upgrades in the ESCO's Energy Services
Proposal which will be financed by the Owner. The upgrades must have a
simple payback of five (5) years or less and may include labor and
maintenance cost savings as well as energy savings in the financial
analysis. Additional automation over and above the amount to be financed by
the Owner must meet the criteria described in 2. below.
b) The cost of the boiler system upgrades shall include the costs detailed in
2c) below.
c) Monitoring costs must be paid from Energy Cost Savings as described in
2.d) below.
2. Buildings and Grounds
a) The ESCO must propose to finance the Energy Conservation Measures in the
ESCO's Energy Services Proposal and to be compensated only from utility
grants and from Energy Cost Savings. The financing term may not exceed
ten years.
b) Labor or maintenance cost savings shall not be included in Energy Cost
Savings for the purpose of determining Cost Effectiveness.
c) The cost of the Energy Conservation Measure(s) shall include the cost of the
Detailed Energy Audit, preparation of Energy Services Proposal, design,
labor an materials, ESCO's construction management, ESCO's overhead and
profit, bonding, commissioning, permits, taxes, training, equipment
metering for monitoring and verification, and other costs which the ESCO
and Owner may agree to.
d) Any monitoring cost the ESCO may incur to ensure energy savings are being
achieved and equipment is performing must be paid from Energy Cost
Savings.
PROJECT CONDITIONS
D. MWBE UTILIZATION
The ESCO was selected for this project based on a commitment to include the
involvement of certified Minority and Women Owned Business Enterprises (MWBE).
The ESCO will document efforts to encourage the participation of certified
MWBE's. The ESCO's goals for this project are based on the following
percentage of the Energy Services Proposal:
Minority Business Enterprise(s) To be determined as part of Energy
Services Proposal
Women Business Enterprise(s) To be determined as part of Energy Services
Proposal
E. INDOOR AIR QUALITY
Installation of Energy Conservation Measures shall not sacrifice acceptable
indoor air quality. ESCO shall look for evidence of poor indoor air quality as
part of the audit and design phases. Improvements shall be proposed which
ensure that minimum outside air is supplied to occupied areas in accordance
with the WASHINGTON STATE VENTILATION AND INDOOR AIR QUALITY CODE.
(Note: Washington State Department of Labor & Industries is currently
developing a WAC: INDOOR AIR QUALITY IN NON-INDUSTRIAL WORK ENVIRONMENTS.
When this proposal becomes effective, this Item will reference the new
standard.)
F. WATER CONSERVATION
Water conservation opportunities in both buildings and grounds shall be
aggressively investigated and analyzed. Water conservation opportunities will
be described in the Energy Audit Report and Cost Effective water conservation
projects will be included in the Energy Services Proposal.
G. POWER QUALITY
The establishment of a power quality baseline and the maintenance of acceptable
power quality before, during and after installation of Energy Conservation
Measures (ECM's) shall be included in the scope of the Energy Services Proposal
if sensitive equipment is served by transformers to which non-linear devices
will be added.
PROJECT CONDITIONS
H. STANDARDS OF COMFORT
The Standards of Comfort for the facility are as follows:
1. Indoor Temperatures:
Occupied:
Winter Minimum - 68 degrees F
Winter maximum - 74 degrees F
Summer Minimum - 73 degrees F (where mechanical cooling systems are employed)
Summer Maximum - 74 degrees F (where mechanical cooling systems are employed)
Unoccupied:
Minimum - 40 degrees F
Maximum - 85 degrees F (where mechanical cooling systems are employed)
2. Relative Humidity: (If humidity control provided)
Minimum - 40%
Maximum - 60%
3. Minimum outside air per occupant:
In accordance with ASHRAE standards and WASHINGTON STATE VENTILATION AND INDOOR
AIR QUALITY CODE
4. Illumination Levels:
Illumination levels shall be as recommended by the Illuminating Engineer's
Society (IES) and shall be calculated using a 70% lamp depreciation/maintenance
factor.
ESCO PROPOSAL
JANUARY 14, 1997
REVISED FEBRUARY 11, 1997
This proposal is submitted to the State of Washington, Department of General
Administration, Division of Engineering and Architecture (the "State") for
energy conservation measure implementation at the Northern State Multi Service
Center at Sedro Xxxxxxx, Washington. Onsite Energy Corporation ("Onsite")
having been selected by the State to provide ESCO services at the above
facility, makes the following proposal:
Onsite will proceed with the energy analysis and audit, feasibility study,
conceptual design and financial proposal for applicable energy efficiency
technologies at the Sedro Xxxxxxx Multi Service Facility. The scope of
services to be performed by Onsite will be:
1. Conduct an energy audit and analysis of the facility's lighting
systems for all of the buildings listed on attachment 1. The audit will be
presented in a spread sheet format listing the existing lighting, the
recommended improvements, the savings to be achieved, and the fixed price quote
to implement the changes.
2. Conduct an energy audit and analysis of all of the facility's 3 HP
and above motors and determine
where energy savings can be obtained by replacing the motors with variable
frequency drives, energy efficient motors, and/or down sizing the motors. The
audit will be in a spread sheet format with a listing of the existing
conditions, the recommended changes, the energy savings to be achieved, and the
fixed price quote to implement the changes.
3. Conduct an energy audit and assessment of selected buildings in the
facility, as noted on attachment 1, to determine what HVAC energy conservation
changes are recommended. The energy assessment will include a spread sheet/bin
model of the facilities, the existing conditions, recommended changes, estimated
existing energy usage, the energy savings, and the fixed price quote to
implement the changes.
4. Conduct an energy audit and assessment of the boiler operation to
determine what energy measures can be effectively implemented. The assessment
will include at least the following options:
a. Installation of a new automated boiler to operate as the
primary source of steam.
b. Installation of two new automated boilers to provide the total
source of steam for summer and winter operation.
c. Installation of a new stack on one of the 16,000 pph existing
boilers with O2 control modifications to the existing control system.
d. Installation of new O2 controls to the existing stack/breaching
system for one of the existing 16,000 pph boilers with modifications to the
existing control system.
5. Present a proposal to the State within 60 days from notice to proceed
to include a construction and funding plan with financing provided through
Onsite for those ECMs whose simple payback is seven (7) years or less. Also
included will be descriptions of the operation of the recommended changes and a
project management plan including a project schedule, identification of the
permitting requirements, the guaranteed savings, and a verification and
monitoring program.
If the proposal presented in the scope of work does not include any ECMs that
Onsite is willing to finance based on a seven year simple pay back, then the
State does not have any obligations to Onsite for the audit, analysis, and
proposal work completed by Onsite. If however, Onsite is willing to provide
financing for ECMs that have a simple payback of seven years or less and Onsite
is willing to guarantee the savings for these ECMs, then the State agrees to
enter into an agreement with Onsite to permit Onsite to proceed with the
implementation of the recommended ECMs. If the State decides not to permit
Onsite to implement the recommended ECMs, then the State agrees to compensate
Onsite $41,000 for the audit and analysis of the facility's buildings and
$11,000 for the audit and analysis of the boiler systems.
In the agreement to proceed with the implementation of the ECMs, Onsite agrees
to provide to the State copies of Onsite's insurance certificates as indicated
in the December 6, 1996 transmittal from the State to Onsite. Prior to
commencement of construction, Onsite will provide a construction performance
bond in the form requested by the state in its transmittal of December 6, 1996.
In connection with this proposal, Onsite shall provide to the State certain
confidential information regarding the business (including but not limited to
marketing, sales, financial, operating and performance information). The State
agrees to (i) hold in confidence and not disclose such confidential information
to any third party without prior written consent of Onsite: and (ii) use such
confidential information only for the purposes of deciding on the
implementation of the ECMs. Onsite will identify the material which is deemed
to be confidential and this material will be separate from the energy services
proposal.
This proposal is good until April 14, 1997.
Signed By:
ONSITE ENERGY CORPORATION
/s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx, PE
Vice President
Attachment 1. List of Facility Buildings and Audits
ATTACHMENT 1
BUILDINGS AUDIT COMMENTS
BUILDING Lighting Motor HVAC REMARKS
AUDIT AUDIT AUDIT
#2 Xxxxxxx Yes Yes No Tamper proof fixtures
#4 Xxxxxxx No Yes Yes New lighting installed
# 10 Recreation Bldg. Yes Yes No Hot Water Boiler Review
#12 Xxxxx Yes Yes Note 1 Dormitory
#13 Kitchen Yes Yes No
#14 Hub Ground Floor No No No Upper floor not used
#15 Xxxxxxxx Yes Yes Note 1 Dormitory
#16 Xxxxxx Yes Yes Note 1 Dormitory
#17 Xxxxx Yes Yes Note 1 Dormitory
#19 Powerhouse Yes Yes Note 2 Separate boiler audit
#22 Plumbing Shop Yes Yes No
#23 Xxxxxxxxx Shop Yes Yes No
#24 Paint Shop Yes Yes No Clerical class rooms
#25 Planer Shop No No No Being remodeled
#26 VST Building Yes No No
#27 Commissary Yes Yes No
#28 Garage Yes Yes No
#30 Cultural Center Yes Yes No Direct gas fired heat
#31 Trades Building Yes Yes No
#32 Admin. Bldg. Yes Yes Yes
#33 Landscape Classrms Yes Yes No All electric heat
#34 Cottage #6 Security No No No All electric
#42 Apt Building A Yes No No Hot water boiler heat
#43 Apt Building B Yes No No Hot water boiler heat
#45 Cottage # 7 No No No Residential, Steam heat
#46 Cottage # 8 No No No Residential, Steam Heat
#47 RSN Building No No No Independent entity
Yard Lighting Yes No No
NOTE 1: Only one of the dormitories will be analyzed. The energy consumption
of the other buildings will be estimated based on square footage from the model.
NOTE 2:A separate analysis will be conducted of the boiler operations including
the instrument air system.
STATE OF WASHINGTON
DEPARTMENT OF GENERAL ADMINISTRATION
DIVISION OF ENGINEERING AND ARCHITECTURAL SERVICES
CONDITIONS OF THE
ENERGY SERVICES AGREEMENT
TABLE OF CONTENTS
SECTION TITLE
1 Definitions
2 Energy Services Proposal
3 Installation and Operation of ESCO Equipment
4 Energy Baseline Modifications
5 Payment for ESCO Equipment and Services
6 Agreement Term
7 Equipment Maintenance and Owner Training
8 Equipment Operation
9 Assignment of Contract
10 Prevailing Wages
11 Equipment Insurance
12 Liability Insurance
13 Bonding
14 Indemnification
15 Events of Default
16 Termination for Convenience of Owner
17 Mediation and Arbitration
18 Choice of Law
19 Representations and Warranties
20 Agreement Subject to Legislative Appropriation
ATTACHMENT: BOND FORM
SECTION 1
DEFINITIONS
A. Addendum" means a written modification to the Energy Services Agreement,
authorized and signed by the Owner, ESCO and the Facility. The purpose
of the Addendum shall be the incorporation of the ESCO's Energy Services
Proposal(s) and other modifications to the Energy Services Agreement that
are agreed to by all parties.
B. "Baseline Energy Consumption" for any Billing Period means the Energy
Consumption that would have been incurred by the Facility but for the
ESCO Services and ESCO Equipment, as calculated by utilizing the data,
methodology and variables set forth in the Energy Services Proposal.
C. "Billing Period" means the time period as set forth in the Energy
Services Proposal (e.g. month, quarter, year) which will be used to
calculate Energy Savings for the Facility.
D. "Construction Cost" means the actual cost of purchasing and installing
the ESCO Equipment as demonstrated by the installation price quotes or
construction contracts.
E. "Cost Effective" ESCO Equipment, ESCO Services, and Energy Conservation
Measures(ECMs) means Equipment, Services, and ECMs that meet the economic
criteria described in Project Conditions.
F. "Detailed Energy Audit" means the Facility energy analysis conducted by
the ESCO to identify Cost Effective ECMs and to facilitate preparation of
the Energy Services Proposal.
G. "Energy Services Agreement" means the signed Agreement, Project
Conditions and authorized Addenda.
H. "Energy Services Proposal" means the energy conservation report and
financial proposal required by Section 2 of these Conditions. The
negotiated Energy Services Proposal(s) will be incorporated into the
Energy Services Agreement by execution of Addenda.
I. "ESCO Equipment" means the equipment installed or caused to be installed
by the ESCO, as set forth in the Energy Services Proposal.
J. "ESCO Service" means all the services to be provided by the ESCO, as set
forth in the Energy Services Proposal.
K. "Energy Audit Documentation" means an appendix to the Energy Services
Proposal describing the findings of the Detailed Energy Audit. The
appendix will provide detailed documentation of field work for the
Detailed Energy Audit, calculation input and output in support of the
recommendations made in the Energy Services Proposal, economic and
engineering assumptions, sketches, floor plans and any other information
developed in the course of the Audit.
L. "Energy Consumption" means the amount of electrical energy and demand,
natural gas, oil, propane, or other fuel, consumed in the Facility in any
Billing Period, as calculated by utilizing the data, methodology and
variables set forth in the Energy Services Proposal. Energy consumption
may also include other utilities such as water and sewer.
M. "Energy Conservation Measure (ECM)" means an installation or modification
of an installation in a facility which is primarily intended to reduce
Energy Consumption or to allow use of an alternative energy source and
includes ESCO Equipment.
N. "Energy Cost Savings" means savings in units of consumption (e.g. kWH, kW
demand, therms, gallons) in a Billing Period times the cost per unit of
consumption for the Billing Period, as set forth in the Energy Services
Proposal.
O. "Energy Equipment" means equipment or structural components that
influence Energy Consumption in the Facility.
P. "Energy Savings" means, for each form of energy for each Billing Period,
the difference between the Baseline Energy Consumption for that Billing
Period and the Energy Consumption actually incurred in that Billing
Period as set forth in the Energy Services Proposal.
Q. "Existing Equipment and Operating Conditions" means the Energy Equipment
and operating conditions that are identified in the Energy Services
Proposal as existing at the time of the Energy Services Proposal.
R. "Facility" means the building(s) or facility(s) included in the Energy
Services Agreement and described in the Energy Services Proposal.
S. "Funding Source" means the private or public entity, other than the ESCO,
providing funding for the project. Funding Sources may include
utilities, federal agencies, state agencies, or local entities. The
Funding Sources may provide funding in the form of budgeted funds,
grants, loans, and/or long-term incentive payments.
T. "Maximum Allowable Project Cost" means the guaranteed not-to-exceed cost
of purchasing and installing the ESCO Equipment, as set forth in the
Energy Services Proposal, including, but not limited to, the cost of
preparing the Energy Services Proposal and associated engineering and
construction management costs.
U. "Notice of Commencement of Energy Cost Savings" means written notice from
the ESCO to the Owner that the ESCO has substantially completed
installation of ESCO Equipment and/or that it has provided ESCO Services
and that such equipment or services are now providing Energy Savings
sufficient for the Owner to begin making payments as set forth in the
Energy Services Proposal.
V. "Project Conditions" means those Facility specific conditions or
constraints described in the Energy Services Agreement, including the
Cost Effectiveness criteria; the agreed upon ESCO fee for the Energy
Services Proposal; the Schedule of Performance; and, other conditions
included in the Energy Services Agreement.
W. "Termination Value" means the amount that the Owner may pay to the ESCO
in any year to terminate the Energy Services Agreement, as set forth in
the Energy Services Proposal.
X. "Payback" means the cost of the project including audit, design,
construction and management costs divided by the annual Energy Cost
Savings. The project cost is not offset by any utility contribution for
the purposes of this calculation.
SECTION 2
ENERGY SERVICES PROPOSAL
X. XXXX shall undertake a Detailed Energy Audit of the Facility at its sole
expense. The Energy Audit shall identify all cost effective Energy
Conservation Measures as specified in the Project Conditions. ESCO shall
present to the Owner a written Energy Services Proposal, including the
Energy Audit Documentation, within the time specified in the Project
Conditions and commencing on the date of the Authorization to Proceed.
The Energy Services Proposal shall set forth at least the following:
1. A description of the Facility and a description of those buildings and
systems which shall receive ESCO Equipment and ESCO Services;
2. The Cost Effective ECMs to be installed or caused to be installed by the
ESCO and a description of the ECM's analyzed but disqualified under the
cost effectiveness criteria.
3. The services that the ESCO will perform or cause to be performed on or in
the Facility, including but not limited to engineering, construction
management, the operations and maintenance procedures for use on ESCO
Equipment, training for Facility personnel, providing warranty service,
and equipment maintenance;
4. The Maximum Allowable Project Cost, itemized in detail, which may be
amended to represent actual costs;
5. Recommendations for replacement of Existing Equipment, along with
recommendations for improvements to Existing Equipment and Operating
Conditions;
6. The standards of comfort and service appropriate for the Facility;
7. The Baseline Energy Consumption for the Facility, including the data,
methodology and variables used to compute the Baseline, and the Baseline
calendar period which shall not be less than twelve (12) months;
8. The estimated Energy Savings and Energy Cost Savings that are expected to
result from the installation of the ESCO Equipment and from the ESCO
Service, and an explanation of the method used to make the estimate;
9. The method by which Energy Savings and Energy Cost Savings will be
calculated during the term of the Energy Services Agreement;
10. A description of how the ESCO will finance its acquisition of the ESCO
Equipment and when title to the ESCO Equipment will pass to the Owner;
11. A description of how the Energy Cost Savings will be guaranteed by the
ESCO;
12. A description of how the ESCO proposes to be compensated;
13. The term of the Energy Services Agreement;
14. The Termination Value for each year during the term of the Energy
Services Agreement;
15. The schedule for project completion;
16. The nature and extent of the work and equipment that the ESCO anticipates
it will receive from other firms under subcontract.
B. The parties intend for the ESCO to be compensated for the Energy Services
Proposal out of Energy Cost Savings and utility company payments, as
provided under Section 5, if the parties can agree on the content and
form of the Energy Services Proposal. Agreement on the content and form
of the Energy Services Proposal will be evidenced by executing an
Addendum to the Energy Services Agreement.
C. Notwithstanding paragraph B. of this section, the Energy Services
Agreement shall terminate and there will be no compensation for the
Energy Services Proposal unless the ESCO proposes in the Energy Services
Proposal to:
1. Finance and install, or cause to be installed, Cost Effective ECMs; and,
2. Be compensated only out of Energy Cost Savings and utility payments
during the term of the Energy Services Agreement; and,
3. Provide ESCO Equipment and ESCO Services which maintain standards of
comfort and service acceptable to the Owner.
D. If the ESCO meets the conditions of paragraph C. of this section and the
Owner requests changes to the Energy Services Proposal, the parties shall
in good faith negotiate the requested changes and shall modify the Energy
Services Proposal accordingly. If the parties cannot agree on a modified
Energy Services Proposal within one hundred twenty (120) days after the
Owner's receipt of the Energy Services Proposal, the Energy Services
Agreement shall be deemed terminated, and the Owner shall pay to the ESCO
not more than the amount specified in the Project Conditions, as
compensation for the preparation of the Energy Services Proposal. Such
payment shall entitle the Owner to utilize the Energy Services Proposal
for its benefit after termination of the Energy Services Agreement.
E. If the ESCO fails to conduct a Detailed Energy Audit or fails to present
to the Owner a written Energy Services Proposal within the time specified
in the Project Conditions or if such Proposal does not include Cost
Effective ESCO Services and ECMs, the Energy Services Agreement may be
terminated by the Owner. The ESCO shall pay to the Owner an amount
specified in the Project Conditions and there will be no compensation to
the ESCO.
F. To enable the ESCO to prepare the Energy Services Proposal, the Owner
will provide:
1. Access to the Facility for the ESCO's staff;
2. The Facility's energy bills for the two year period immediately preceding
the execution of the Energy Services Agreement;
3. Data on the Facility's variables, such as occupancy rate, which may
affect the Facility's Energy Consumption;
4. Any energy audits that have been conducted within the last five
years;
5. A description of the energy management practices presently in use at
the Facility; and,
6. A description of future plans for the Facility including planned
remodels, additions, demolition and other major Facility changes.
G. Following the submission of the Energy Services Proposal, the Owner and
the ESCO shall meet to decide how subcontractors, if any, will be
selected. For all subcontractors, final selection and price will be
subject to the Owner's approval before a contract is awarded, which
approval shall not be unreasonably withheld.
H. It is the intent of the parties to hold periodic meetings between the
ESCO and the Owner to review the ESCO's progress under the Energy
Services Agreement, to agree on any re-direction, to coordinate any
outside work with the schedule of the Facility, and to generally maintain
quality control. Owner will designate one overall project manager and
one employee located at the facility to coordinate ESCO's activities
under the Energy Services Agreement. Owner will designate the areas of
authority of each. ESCO shall be entitled to rely upon statements or
decisions made by such persons for all purposes under the Energy Services
Agreement.
I. Design review meetings shall be held at the Design Development (DD, 50%
complete) and Construction Documents (CD, ready for bid) stages. ESCO
shall provide two (2) complete sets of documents for Owner review at the
DD and CD phases. A fourteen (14) calendar day review period shall be
allowed at the DD and CD phases for ESCO quality control and to receive
Owner's comments. An additional seven (7) calendar days (beyond the
review period) shall be allowed for incorporation of Owner comments.
SECTION 3
INSTALLATION AND OPERATION OF ESCO EQUIPMENT
A. Within the period provided for completion and within the Maximum
Allowable Project Cost as set forth in the Energy Services Proposal, the
ESCO shall:
1. Implement the ESCO Services; and
2. Acquire and install the ESCO equipment, or cause the ESCO equipment to
be installed.
B. If, after the date the Energy Services Proposal becomes a part of the
Energy Services Agreement, the ESCO desires to add to the ESCO Services
or the ESCO Equipment a component that is not identified in the initial
Energy Services Proposal, the ESCO shall identify that component in a
supplement to the Energy Services Proposal, which upon the written
agreement of the Owner shall be added to the Energy Services Proposal as
an Addendum to the Energy Services Agreement.
C. Once a piece of ESCO Equipment is installed at the Facility, the Owner
may not thereafter refuse to allow the ESCO Equipment to operate unless
there is an emergency or the ESCO commits an event of default under
Section 15.
D. The Owner will allow the ESCO to have access to the Facility in order to
provide ESCO Services, to review Owner's operating methods and
procedures, and to monitor the ongoing duties and obligations of Owner
and ESCO under the Energy Services Agreement. In the event that title to
the ESCO Equipment remains with the ESCO during the term of the Energy
Services Agreement, the Owner will provide mutually satisfactory rent
free space for the ESCO Equipment.
SECTION 4
ENERGY BASELINE MODIFICATIONS
A. The Baseline Energy Consumption data, methodology and variables set forth
in the Energy Services Proposal may be modified if the Energy Consumption
of the Facility changes due to:
1. A change in the operating hours of the Facility;
2. A change in the occupancy of the Facility;
3. Building additions, remodels or closures;
4. A change in the Facility's Energy Equipment or operating parameters
other than the ESCO Equipment;
5. Energy Equipment other than ESCO Equipment malfunctions, or is
repaired or replaced in a way that increases or decreases Energy
Consumption;
6. Other actions taken by the Owner that may reduce or increase Facility
energy use; or,
7. An error in the original Baseline is discovered. If such an error is
discovered, the change shall be retroactive.
B. The Owner will notify the ESCO of any change in the Facility's Existing
Equipment or Operating Conditions that may reasonably be expected to
cause the Facility's annual Energy Consumption to change, within fifteen
(15) days of the time that the change becomes known to the Owner, with
confirmation in writing to the ESCO within thirty (30) days.
C. Baseline Energy Consumption modifications will be accomplished through
negotiation between the Owner and the ESCO. Each party shall bear its
own costs in these negotiations. If the parties cannot agree, the
parties shall follow the procedures described in Section 17, Mediation
and Arbitration.
SECTION 5
PAYMENT FOR ESCO EQUIPMENT AND SERVICES
The Owner may use any combination of the following payment options to discharge
its obligations under the Energy Services Agreement.
A. In the event that ESCO finances or causes the project to be financed, in
whole or in part, ESCO may be paid using Energy Cost Savings as follows:
1. Payment to ESCO will begin after ESCO delivers, and Owner accepts, in
writing, the Notice of Commencement of Energy Cost Savings. The Notice
shall be written notification to the Owner that the ESCO has
substantially completed installation of ESCO Equipment and/or that it has
provided ESCO Services and that such Equipment or Services are now
providing Energy Savings sufficient for the Owner to begin making
payments as set forth in the ESCO's Energy Services Proposal.
2. The Owner will instruct each of its energy suppliers to provide the ESCO
with the Facility's energy bills or will otherwise provide the ESCO with
the energy bills within fourteen (14) calendar days of the date the bills
are received by the Owner.
3. The ESCO shall calculate the Energy Savings and Energy Cost Savings for
each form of energy in accordance with the compensation arrangement set
forth in the Energy Services Proposal.
4. At any point the Owner may challenge the Energy Savings or Energy Cost
Savings calculations made by the ESCO. If the parties cannot agree, the
parties shall attempt mediation. If the parties still cannot agree, the
parties shall follow the procedures described in Section 17, Mediation
and Arbitration.
5. Within thirty (30) days after each anniversary of the date the Owner
begins making payments to the ESCO, ESCO shall effect an annual
reconciliation of Energy Cost Savings achieved in the Facility during the
previous year. The annual reconciliation of Energy Cost Savings,
including the data and methodology used to calculate the savings, shall
be documented in a written report and provided to the Owner not more than
thirty (30) days after the ESCO received the Facility's last monthly
energy xxxx for the twelve (12) month period being reported.
In the event that the actual savings are less than the amount guaranteed
by the ESCO as stated in the ESCO's Energy Services Proposal, ESCO shall
pay Owner the difference between the guaranteed amount and the actual
amount within thirty (30) days of submittal of the ESCO's annual
reconciliation report.
6. The payments to ESCO under the Energy Services Agreement are due and
payable within thirty (30) days of the date the Owner receives the
invoice.
B. In the event that all or a portion of the payments to the ESCO are
dependent on grants, loans and/or incentives from utilities or other
Funding Sources, ESCO may be paid using the grant, loan and/or incentive
payments from these Funding Sources as follows:
1. Payments to ESCO will begin after ESCO delivers, and Owner and
Funding Source accepts, in writing, the Notice of Commencement of
Energy Cost Savings. The Notice shall be the written notification
to the Owner and the Funding Source that the ESCO has substantially
completed the installation of ESCO Equipment and/or that it has
provided ESCO Services and that such Equipment or Services are now
providing Energy Savings sufficient for the Funding Source to begin
making payments.
2. The portion of the payments to the ESCO that are dependent on these
Funding Sources shall be due and payable within thirty (30) days of the
date Owner receives the grant, loan and/or incentive funds.
3. Construction progress payments may be made in accordance with the terms
of the Funding Source. In no event, however, will progress payments
exceed 95% of the total in place construction.
4. Owner will retain 5% of the amount of each progress payment until
forty-five (45) days after the acceptance of the final Notice of
Commencement of Energy Cost Savings and receipt of all documents required
by law or the Energy Services Agreement.
C. In the event that ongoing monitoring services are required to provide the
Energy Savings Guarantee, ESCO may be paid using Energy Cost Savings in
accordance with the provision of paragraph A. 1. through A. 6.
SECTION 6
AGREEMENT TERM
The Energy Services Agreement shall run consecutively from the date of the
Authorization to Proceed, and shall terminate as defined in the Energy Services
Proposal unless the Energy Services Agreement is terminated sooner under
Sections 2.C., 2.D., 2.E., 15, 16, or unless the Owner chooses to terminate the
Agreement sooner by paying the ESCO the Termination Value upon ninety (90) days
prior written notice.
SECTION 7
EQUIPMENT MAINTENANCE AND OWNER TRAINING
A. The ESCO shall provide the maintenance and training services set forth in
the Energy Services Proposal.
B. If Energy Equipment other than ESCO Equipment breaks down, the Owner will
be responsible for arranging and paying for its repair or replacement.
The ESCO shall have the right to inspect the repaired or replaced Energy
Equipment.
SECTION 8
EQUIPMENT OPERATION
The ESCO shall at all times attempt to attain the maximum Energy Savings from
the Facility's Energy Equipment. However, the ESCO shall, under no
circumstances, operate and maintain any Energy Equipment in a manner that
reduces the Facility's standards of comfort, health and safety.
SECTION 9
ASSIGNMENT OF CONTRACT
The ESCO may not assign or transfer its rights and obligations stated herein
without the prior written consent of the Owner. The ESCO may not assign or
sell any financing contracts used to fund the ESCO Energy Equipment and/or ESCO
Services without the prior written consent of the Owner.
SECTION 10
PREVAILING WAGES
The ESCO, its subcontractors and agents shall pay wages to all employees
performing work under the Energy Services Agreement which shall not be less
than the prevailing wages for such work as set forth by the Washington State
Department of Labor and Industries for the county in which the work is
performed. The ESCO, its subcontractors and agents shall be solely responsible
for determining wage classifications and shall pay all penalties for violations
thereof.
SECTION 11
EQUIPMENT INSURANCE
Owner represents and warrants that in state-owned facilities it is self-insured
and assumes the risk of loss, theft or damage to the ESCO Equipment, whether or
not covered by insurance and no such loss, theft or damage shall relieve the
Owner of its obligations hereunder. In the event of loss, theft or damage to
the ESCO Equipment or other acts which may render the ESCO Equipment
unserviceable, the Owner shall promptly notify ESCO and shall place such ESCO
Equipment in good condition or working order or replace such ESCO Equipment
with like equipment in good condition and working order and furnish ESCO with
necessary documents to provide ESCO with title or security interest in such
equipment. This Owner obligation shall not apply to liability, losses, claims
and damages caused or created by ESCO, its agents, officers, employees, or
subcontractors.
SECTION 12
LIABILITY INSURANCE
A. Prior to commencement of any construction, the ESCO shall obtain all the
insurance required by this section. Further, the ESCO shall not allow
any subcontractor to commence work on a matter related to the Energy
Services Agreement until the subcontractor has obtained similar
insurance. Companies and agents writing the insurance required under
this section shall be licensed to do business under Chapter 48 RCW or
comply with the Surplus Lines Law of the State of Washington. Insurance
carriers providing insurance shall be rated "A + VII" or better by A.M.
Best and ratings shall be indicated on the insurance certificates.
X. XXXX shall maintain the following insurance coverage during the work and
for a period of one year after the Owner accepts the work.
1. General liability on the ISO 1986 New Occurrence Form, or its
equivalent, which shall include:
a. Completed operations / products liability;
b. Explosion, collapse, and underground; and
c. Employer's liability coverage.
2. Automobile liability.
C. The ESCO shall comply with the Washington State Industrial Insurance Act,
and, if applicable, the Federal Longshoremen's and Harbor Worker's Act,
and the Xxxxx Act.
D. All insurance coverages shall protect against claims for damages for
personal and bodily injury or death, as well as claims for property
damage, which may arise from operations in connection with the work
whether such operations are by ESCO or any ESCO subcontractor.
E. All insurance coverages shall be endorsed to include the Owner as an
additional named insured.
F. The coverage limits shall be as follows:
1. Limits of Liability shall not be less than $1,000,000 Combined Single
Limit for Bodily Injury and Property Damage (other than Automobile
liability) Each Occurrence; Personal Injury and Advertising Liability
Each Occurrence.
2. $2,000,000 Combined Single Limit Annual General Aggregate.
3. $2,000,000 Annual Aggregate for Products and Completed Operations
Liability.
4. $1,000,000 Combined Single Limit for Automobile Bodily Injury and
Property Damage Liability, Each Accident or Loss.
G. All insurance certificates shall specifically require forty-five (45)
days prior written notice to Owner of cancellation or any material
change, except thirty (30) days for Surplus Lines insurance.
SECTION 13
BONDING
The ESCO shall provide a payment and performance bond in the amount of 100% of
the construction cost, as defined in the Energy Services Agreement Addendum.
The amount shall include all authorized changes and state sales tax. The Bond
shall be in the form attached to these "Conditions." The Contract listed on
the bond form shall be the Addendum No. and Agreement No. which incorporates
the work and the "Contract Date" shall be the date of the Addendum. The full
and just sum of the Bond shall be as defined in the Energy Services Agreement
Addendum and shall include the actual cost of purchasing and installing the
ESCO Equipment, job superintendent and state sales tax. The Bond shall
specifically exclude coverage for those portions of the Energy Services
Agreement and/or Energy Services Agreement Addendum pertaining to design
services, energy cost savings guarantee, maintenance guarantee, utility
incentives, efficiency guarantees, and any other clauses which do not relate
specifically to construction management and supervision of work for purchasing
and installing of ESCO Equipment, or for work to be accomplished by the Owner.
The Bond shall be with a Surety or Bonding Company that is registered with the
State of Washington Insurance Commissioner's Office.
SECTION 14
INDEMNIFICATION
A. The ESCO shall indemnify, defend and hold the Owner harmless from any and
all claims, actions, costs, expenses, damages and liabilities, including
attorney's fees, arising out of, connected with or resulting from
negligence or misconduct of the ESCO, agents, officers, employees, or
subcontractors in connection with its activities within the scope of the
Energy Services Agreement. The duty to indemnify will continue in full
force and effect notwithstanding the expiration or early termination of
the Energy Services Agreement with respect to any claims based on facts
or conditions which occurred prior to the termination.
B. If the claims, actions, costs, expenses, damage or liabilities, as
provided in paragraph A. of this section, are caused by or result from
the concurrent negligence of the Owner or its agents or employees, and
the ESCO, its agents, officers, employees, or subcontractors; the
indemnity provisions provided in paragraph A. shall be valid and
enforceable only to the extent of the ESCO's negligence.
C. The ESCO shall further hold harmless the Owner from all fees, taxes, and
assessments which may be levied upon or with respect to the ESCO
Equipment installed under the Energy Services Agreement, and shall hold
the Owner harmless from any other charges which may be imposed or
incurred by any public or private authority with respect to the ESCO or
its operation.
SECTION 15
EVENTS OF DEFAULT
A. Each of the following events or conditions shall constitute an "Event of
Default" by the Owner:
1. Any failure by the Owner to pay the ESCO compensation as required by
Section 5 within a period of ninety (90) days after the Owner receives
the invoice;
2. Any intentionally false or misleading material representation or warranty
furnished by the Owner in connection with the Energy Services Proposal or
the Energy Services Agreement;
3. The Baseline Energy Consumption is reduced, through changes in the
Existing Equipment or Operating Conditions, such that energy savings as
guaranteed by ESCO cannot be produced and Owner fails to pay the ESCO as
set forth in the Energy Services Proposal; or
4. Any material failure by the Owner to comply with the terms and conditions
of the Energy Services Agreement, including breach of any covenant
contained herein, providing that such failure continues for thirty (30)
days after notice to the Owner requesting that such failure to perform be
remedied, or if a remedy cannot be effected in such thirty (30) days,
with a good faith effort by the Owner to perform in that period and
diligent subsequent performance.
B. Each of the following events or conditions shall constitute an "Event of
Default" by the ESCO;
1. The ESCO fails to propose to finance Cost Effective ECMs;
2. The ESCO fails to provide an energy cost savings guarantee in the
Energy Services Proposal;
3. The ESCO fails to submit an Energy Services Proposal within the time
specified in the project conditions or fails to install the ESCO
Equipment or provide the ESCO services within the schedule for project
completion specified in the Energy Services Proposal;
4. The ESCO fails to produce the guaranteed energy savings and fails to pay
the Owner the guarantee payment as set forth in the Energy Services
Proposal, in any consecutive twelve (12) month period during the term of
the Energy Services Agreement.
5. The standards of comfort and service set forth in the Energy Services
Agreement are not provided due to failure of the ESCO to maintain,
repair, or adjust the ESCO Equipment, or failure to provide other ESCO
Services as described in the Energy Services Proposal and said failure
continues for thirty (30) days after written notice to the ESCO without
good faith efforts by ESCO to make the necessary repairs or adjustments.
6. Any intentionally false or misleading material representation or warranty
furnished by the ESCO in connection with the Energy Services Proposal or
the Energy Services Agreement;
7. Any material failure by the ESCO to comply with the terms and conditions
of the Energy Services Agreement, including breach of any covenant
contained herein, providing that such failure continues for thirty (30)
days after notice to the ESCO requesting that such failure to perform be
remedied, or if a remedy cannot be effected in such thirty days, with a
good faith effort of the ESCO to perform in that period and diligent
subsequent performance.
C. Upon the occurrence of an event of default by the Owner, ESCO may
exercise all remedies at law or at equity or other appropriate
proceedings for recovery of amounts due and owing and unpaid by the Owner
for damages and/or for specific performance; and if the Energy Services
Proposal provides that ESCO shall retain title to the ESCO Equipment
during the term of the Energy Services Agreement, without recourse to
legal process, terminate the Energy Services Agreement by delivery of a
notice declaring termination and remove the ESCO Equipment.
D. In the event of default by the ESCO, the Owner may exercise all remedies
available at law or at equity including bringing action for recovery of
amounts due to the Owner for damages and/or specific performance. Also,
the Owner may exercise its option to terminate the contract by paying the
Termination Value to the ESCO, without the otherwise required ninety (90)
day notice. Further, if the Energy Services Proposal provides that ESCO
shall retain title to the ESCO Equipment during the term of the Energy
Services Agreement, the Owner may, without recourse to the legal process,
terminate the Energy Services Agreement by delivery of notice declaring
termination, whereupon the ESCO shall remove the ESCO Equipment and
reconnect and restore the Owner's original equipment or equivalent to the
condition which existed prior to the inception of the Energy Services
Agreement, normal wear and tear excepted.
E. In the event of default by the Owner, the Owner shall be liable to the
ESCO, as liquidated damages in lieu of all other claims for damages, the
Termination Value as set forth in the Energy Services Proposal.
F. In the event of default by the ESCO, in addition to other damages, the
ESCO shall be liable to the Owner for energy savings that would have
occurred over the term of the Energy Services Agreement, but for default,
which shall be determined based on the estimated Energy Cost Savings
described in the Energy Services Proposal.
SECTION 16
TERMINATION FOR CONVENIENCE OF OWNER
A. The Owner may, upon written notice, terminate (without prejudice to any
right or remedy of Owner) the Energy Services Agreement.
B. Unless Owner directs otherwise, after receipt of a written notice of
termination, ESCO shall promptly:
1. Stop performing work on the date and as specified in the notice of
termination;
2. Place no further orders or subcontracts for materials, equipment,
services, or facilities;
3. Cancel all orders or subcontracts, upon terms acceptable to Owner, to the
extent they relate to the performance of work terminated;
4. Assign to Owner all of the right, title, and interest of ESCO in all
orders and subcontracts;
5. Take such action as may be necessary or as directed by Owner to preserve
and protect the work, project site, and any other property related to
this project in which the Owner has an interest; and
6. Continue performance only to the extent not terminated.
C. If Owner terminates the work or any portion thereof for convenience, ESCO
shall be entitled to make a request for an equitable adjustment for its
reasonable direct costs incurred prior to the effective date of
termination, plus a reasonable allowance for overhead and profit on work
performed prior to termination, plus the reasonable administrative costs
of the termination, but shall not be entitled to any other costs or
damages, whatsoever, provided however, the total sum payable upon
termination shall not exceed the Energy Services Agreement value reduced
by prior payments.
SECTION 17
MEDIATION AND ARBITRATION
The ESCO and Owner shall attempt to settle through mediation any controversy or
claim arising out of or in relation to the Energy Services Agreement or the
refusal to perform the whole or part thereof. Negotiation or mediation shall
be conducted under the Voluntary Construction Mediation Rules of the American
Arbitration Association. If mediation fails to settle the controversy or
claim, it shall be settled by arbitration in accordance with the Construction
Industry Arbitration Rules of the American Arbitration Association. If the
parties cannot agree on an arbitrator, he or she shall be chosen by the
Presiding Judge of the Xxxxxxxx County Superior Court. Judgment upon the award
rendered by the arbitrator may be entered in the courts of the State of
Washington or in any other court having jurisdiction thereof. The prevailing
party at arbitration shall be entitled to reasonable attorney's fees and costs,
as well as other reasonable costs that are incurred as a result of the
controversy or claim.
SECTION 18
CHOICE OF LAW
The Energy Services Agreement shall be interpreted, construed and enforced in
all respects in accordance with the laws of the State of Washington. In case of
any lawsuit, venue will be in Xxxxxxxx County.
SECTION 19
REPRESENTATIONS AND WARRANTIES
Each Party warrants and represents to the other that:
A. It has all requisite power, authority, licenses, permits, and franchises,
corporate or otherwise, necessary to execute and deliver the Energy
Services Agreement and to perform its obligations;
B. Its execution, delivery and performance of the Energy Services Agreement
has been duly authorized by, and is in accordance with, its organic
instruments, and the Energy Services Agreement has been duly executed and
delivered for it by the signatories and constitutes its legal, valid and
binding obligation;
C. Its execution, delivery and performance of the Energy Services Agreement
will not result in a breach of or violation of or constitute a default
under any agreement, lease or instrument to which it is a party or by
which it or its properties may be bound to be affected; and
D. It has received no notice nor, to the best of its knowledge, is there
pending or threatened any notice, decree, award, permit or order which
would materially adversely affect its ability to perform hereunder.
SECTION 20
AGREEMENT SUBJECT TO LEGISLATIVE APPROPRIATION
A. The Owner's obligation to pay any amounts due under the Energy Services
Agreement or to perform any covenants requiring or resulting in
expenditure of money are contingent and expressly limited to the extent
of legislative appropriations made to fund the Facility and its
obligations. Nothing contained in any other Section of the Energy
Services Agreement shall be construed as creating any monetary obligation
on the part of the Owner beyond such current and specific legislative
appropriations.
B. In the event that the Legislature fails to appropriate the funds
necessary to continue the Energy Services Agreement, the Energy Services
Agreement shall be terminated as to the end of the last fiscal year for
which such appropriation is available. In such event, all obligations of
the Owner will cease so long as all payments previously approved or
appropriated have been paid, and all interest of the Owner in the ESCO
Equipment will terminate and the Energy Services Agreement shall be
terminated.
C. Notwithstanding the foregoing, the Owner agrees not to terminate the
Energy Services Agreement under this provision for the fiscal year in
which the Energy Services Agreement is executed. If any future funds are
appropriated in order to continue the operation of the Facility, the
Owner will use its best efforts to obtain inclusion of Energy Service
Agreement funds in its budget.
Bond No. _______________
______________________________________
Bonding Company's Name
______________________________________
Address
______________________________________
City State
KNOW ALL MEN BY THESE PRESENTS:
That we, _________________________________________________________
As Principal and ________________________________________________________, a
corporation, organized and existing under and by virtue of the laws of the
State of _________________________ and legally doing business in the State of
Washington as Surety, are held and firmly bound and obligated unto the State of
Washington, in the full and just sum of _______________________________________
___________________ Dollars, lawful money of the United States, for the payment
of which sum well and truly to be made, we do bind ourselves, our and each of
our heirs, executors and administrators, successors and assigns, jointly and
severally, firmly by these presents.
This bond is executed in pursuance of Chapter 39.08, Revised Code of
Washington.
THE CONDITIONS OF THIS OBLIGATION ARE SUCH, That whereas the principal
entered into a certain contract with __________________________________________
_______________________________________________________________________________
dated _____________ day of ____________________, 19________,
for __________________________________________________________________________
______________________________________________________________________________
Bond No. _______________
NOW, THEREFORE, if the Principal shall faithfully perform all the provisions of
such contract with specifically relate to equipment installation and related
construction and pay all laborers, mechanics and subcontractors and
materialmen, and all persons who shall supply such person or persons, or
subcontractors, with materials, provisions, and supplies for the carrying on of
such work, then this obligation is void, otherwise to remain in full force and
effect.
This bond excludes coverage for those portions of the Energy Services
Agreement and/or Energy Agreement Addendum pertaining to design services,
energy cost savings guarantee, maintenance guarantee, utility incentives,
efficiency guarantees, and other clauses which do not relate specifically to
construction management and supervision of work for purchasing and installing
of ESCO equipment.
Provided, however, that the conditions of this obligation shall not apply
to any money loaned or advanced to the principal or to any subcontractor other
person in the performance of any such work.
Signed and Sealed this ________________ day of ________________, 19_____.
Countersigned:
__________________________________
__________________________________
_____________________________________ (Seal)
__________________________________________
Principal
_____________________________________ (Seal)
Surety
By________________________________________
Attorney-in-Fact
Approved as to Form
__________________________________
Assistant Attorney General
__________________________________
ENERGY SERVICES AGREEMENT AMENDMENT
Energy Conservation Services Amendment No. 1
Project Xx. 00-000 Xxxxxxxxx Xx. 00-000 X
Xxxxxxxx Xxxxx Multi Service Center Date July 14, 0000
Xxxxx Xxxxxx, Xxxxxxxxxx
THIS AMENDMENT, WHEN PROPERLY SIGNED, SHALL BE THE BASIS ON WHICH THE SUBJECT
AGREEMENT SHALL BE MODIFIED.
AUTHORIZATION (THIS SHEET)
PROJECT COMPLETION AND COMPENSATION
SCOPE OF WORK OPTIONS
OPTION #2: INCORPORATE ENERGY SERVICES PROPOSAL
OPTION #4: ADD OR MODIFY EXTRA SERVICES
APPROVALS: Energy Services Company Facility
Firm/Agency: Onsite Energy Corporation Northern State Multi-Service Center
Address: 00000 Xxxxxxxxxxx Xxxxxxx, Div. of Property Development
No. 308 230 General Administration Bldg.
Tukwila, Washington 98188 Xxxxxxx, XX 00000-0000
By: /s/ Xxxx X. Xxxxxx /s/ Xxx Xxxxxx
Name:
Title:
Date:
Authorization to Proceed
Dept. of General Administration By: /s/ X. X. Xxxxxxxx
Engineering & Architectural Services Name: Xxxxxxx X. Xxxxxxxx, P.E.
PO Box 41012 Title: Energy Program Manager
Xxxxxxx XX 00000-0000 Date:
360-902-7272
PROJECT COMPLETION AND COMPENSATION
Energy service completion sched fee Compensation
Compensation
new previous new previous
Energy Services Proposal (Boiler) $0.00/sq ft $ 11,000.00
Energy Services Proposal (Energy) $ 41,000.00
Design 8% $ 28,160.00
Construction Management 4% $ 14,080.00
Bond 4% $ 14,080.00
General Contracting Overhead & 15% $ 52,800.00
Profit
MACC or Actual Construction Sub's cost + ohp = ins $352,000.00
Costs
Construction Contingency $ 23,300.00
State Sales Tax 7.8% $ 38,643.00
Energy Service Sub-total= $523,063.00 $ 52,000.00
Maximum Energy Service Fee Amount (New + Previous) = A = $575,063.00
Compensation
New Previous
Extra Service Boiler/Asbestos Removal Engineering $3,000.00 $-0-
Extra Service (describe)
Extra Services Total (New + Previous) = B =
Energy Services Agreement Total = A + B = $575,063.00 + $3,000.00 + $578,063.00
Total Compensation for the Energy Services:
Compensation:
New Previous
1. Boiler Plant Automation = $534,063.00 $11,000.00
2. Buildings on List = $ 41,000.00 $41,000.00
3. Extra Services = $ 3,000.00 $ -0-
1 + 2 + 3 = (A) Maximum Energy Service
Fee Amount $578,063.00 $52,000.00
Value of this Amendment = $526,063.00
SCOPE OF WORK
OPTION #2: INCORPORATE ENERGY SERVICES PROPOSAL
A. In accordance with Section 2.D of the Conditions of the Agreement, the
Energy Services Proposal submitted under Project number 97-031 by ONSITE
ENERGY CORPORATION and dated June 12, 1997 is hereby incorporated into
Energy Services Agreement number 97-031 A and is made part thereof by
this reference.
B. The following modifications are made to the Energy Services Proposal:
Washington State Sales Tax changed to 7.8%.
Annual Steamplant Cost Savings changed to $124,689.00
OPTION #4: ADD OR MODIFY EXTRA SERVICES
Provide the services as described below, which shall be invoiced directly
against this Addendum.
A. Provide engineering assistance and project oversight for the removal
of asbestos material and boilers #1 and #2.
B. Identify points for removal of boilers from existing system.
C. After removal, inspect site for installation of new boilers.
D. Work shall be accomplished on a time and material basis in accordance
with the rate schedule attached to Onsite Energy letter of July 8, 1997.
The cost shall not exceed Three Thousand and no/100 dollars ($3,000.00).
Automobile travel will be reimbursed at $0.315 per mile outside a 50 mile
radius from office.
ONSITE ENERGY
ENERGY SERVICES PROPOSAL
BOILER SYSTEM UPGRADES
MULTI-SERVICE CENTER
SEDRO XXXXXXX, WASHINGTON
May 12, 1997
Revised June 12, 1997
INTRODUCTION:
Onsite Energy Corporation ("Onsite") and the State of Washington ("State")
signed an Energy Services Agreement (Agreement No. 97-031) for Energy
Conservation Services at Northern State Multi-Service Center at Sedro Xxxxxxx,
dated January 27, 1997(the Agreement). A requirement of the Agreement was that
Onsite submit a proposal for Energy Services for the boiler systems to the
State within 60 days. Due to changes in the operating conditions, this date
was extended by 14 days at a meeting on April 1, 1997. As a part of this
proposal, if the terms of this proposal are in conflict with the terms of the
Agreement, then the terms of this proposal will supersede and control over the
terms in the Agreement.
1. EXISTING FACILITY:
This project is to be constructed at the power plant at the Multi-Service
Center in Sedro Xxxxxxx, Washington. The power plant consists of four B&W
power boilers. Three of the boilers, Nos. 1, 2 and 3, are 1955 vintage and
produce steam at 16,000 pph at 100 psig. The fourth boiler, No. 4, is a 1962
vintage boiler that produces steam at 25,000 pph at 100psig. The boiler
steaming rate varies from approximately 1,700 pph in the summer to 17,000 pph
during cold snaps in the winter. Boiler Nos. 1, 2 and 3 share a tall stack,
while boiler No. 4 has its own xxxxx xxxxx. The tall stack was part of the
original installation at the facility and the ability of the stack to meet
current structural standards is unknown. All of the boilers have constant
speed ID and FD fans with one set for each boiler.
2. PROPOSED ENERGY CONSERVATION MEASURES(ECMS):
Existing boilers Nos. 1 and 2 will be removed and replaced with two (one 250 HP
and one 300 HP) automated boilers. Each of the new boilers will have its own
xxxxx xxxxx and will be tied into all of the existing steam, condensate, gas,
oil and air systems. The existing breaching for existing boilers Nos. 1 and 2
will be removed along with the associated auxiliary equipment. Boiler No. 4
will have its controls modified so that it will qualify as an automated boiler
and will be available as a stand by source of steam.
Other ECMs that were reviewed were: (1) Installation of a single boiler(either
250 HP or 300 HP) for summer loads, (2) Installing three new 150 HP boilers for
operating during lighter loads, and (3) Automating the existing boiler controls
and burners so that the boiler efficiency would improve.
Of these additional ECMs reviewed, both alternative numbers (1) and (2) would
not fully automate the power plant and permit the operator to be assigned
additional duties. Without this feature, the facility would not achieve the
$110,950 per year in operation and maintenance savings that will be achieved
thorough the proposed ECM. Alternative number (3) was not feasible in that the
boiler control retrofit would cost approximately $30,000 per boiler for the
controls. In addition, high efficiency burner conversions on the boilers would
cost $40,000 per boiler for boiler Nos. 1, 2 and 3 and approximately $80,000
for boiler No. 4. The current boiler burner system is "grandfathered" with
regards to emission limits, but after this conversion the boilers would have to
meet the new emission standards of 30 ppm of NOX. With the age of the boilers
and the potential for discovering casing leaks that could not be economically
repaired, no guarantee could be made that the boilers would meet the emission
requirements after this conversion.
3. SERVICES PROPOSED:
Onsite proposes to design, construct, commission, train the facility's staff on
the proposed ECM, provide a contractor's warranty service for one year
(warranties beyond one year will be provided by the equipment manufacturer per
the purchase orders), and provide monitoring and savings verification services
for the replacement of boiler Nos. 1 and 2 for ten years. These boilers and
the associated asbestos will be removed by the State of Washington based on
removal points identified by Onsite, and two fully automated boilers(one 250 HP
and one 300 HP) will be installed by Onsite. In addition the controls to
boiler No. 4 will be reworked so that it will be a fully automated stand by
source of steam. The two new boilers and existing boiler No. 4 will be tied
together so that they will operate as a fully integrated package. Existing
boiler No. 3 will be abandoned in place.
Training on the new boiler systems will consist of two eight hour class room
sessions with the State's operating personnel, and on the job training of eight
hours (to include one start up) with each of the four operating shifts.
One four hour follow up training session will be held with each shift within
the first month of operation.
Monitoring and verification services will be accomplished quarterly with a site
visit by Onsite personnel to review the plant's operation and a computation and
reconciliation of the energy savings. Onsite will provide this service monthly
for the first quarter after operation, quarterly for the remainder of year one,
semi-annually for year two, and annually for years three through ten.
4. MAXIMUM ALLOWABLE PROJECT COST:
The maximum allowable project cost will be $541,000. The actual project cost
will be established based on the final design and the equipment installed. The
maximum allowable project cost is established from the below table:
Energy Audit $ 11,000
Subcontractor Costs
Demolition: $ 6,500
Boiler and Asbestos Removal By the State
Building modifications $ 15,000
Boiler Equipment $ 238,000
Boiler Equipment Installation $ 12,500
Piping Modifications $ 72,500
Electrical & Controls installation $ 7,500
Subtotal Subcontractor cost $ 352,000
Engineering $ 28,160
Construction management @ 4% $ 14,080
Bonding Expense @ 4% $ 14,080
Onsite overhead and profit @ 15% $ 52,800
Contingency $ 23,300
Onsite's price to the State without taxes $ 495,420
Taxes at 8.2% of construction $ 40,700
E&AS PROJECT MANAGEMENT FEES $ 4,800
Total price $ 540,920
SAY $ 541,000
The above pricing was established by competitive biding of the scope of work.
Once the design is completed, the successful bidder will be requested to modify
their price based on the final design of the project. The actual costs of the
work will be based upon the final lump sum price for the work as designed and
the invoicing based on the bid price. Supporting documentation will be
supplied for the cost of the major equipment installed.
5. RECOMMENDATIONS TO EXISTING EQUIPMENT AND OPERATIONS:
It is recommended, and the guaranteed savings have assumed that the existing
boiler operating pressure be reduced to 50 psig. It is also recommended that
as soon as possible, boiler No. 3 be removed and that the tall stack be
removed.
6. STANDARDS OF COMFORT AND SERVICE APPROPRIATE FOR THE FACILITY:
There will not be any changes in the comfort of the facility resulting from the
proposed ECM. The service level at the facility will improve, since the boiler
plant operators can now be assigned to other duties within the facility, such
as building maintenance.
7. BASELINE ENERGY CONSUMPTION FOR THE ECM:
The baseline energy use of the facility for the purposes of the proposed ECM
will be the measure of boiler efficiency as determined by dividing the (pounds
of steam produced per month X BTU gained per pound for saturated steam at 100
psig) by the (BTU of fuel input), expressed as in decimal form to three places,
i.e. .xxx. Boiler operations during that baseline period were 365 days. The
steam produced will be from the power plant records and the fuel input will be
from the gas supplier's records with the given gas heating value.
8. THE ESTIMATED ENERGY SAVINGS AND ENERGY COST SAVINGS:
Baseline Energy Use (BEU):
The baseline energy use of the facility for the purposes of the proposed ECM
will be the measure of boiler efficiency as determined by dividing the (pounds
of steam produced X [hg-hfw at 100 psig]) by the (BTU of fuel input), expressed
as in decimal form to three places, i.e. .xxx. The baseline period will be for
the year ending April, 30, 1997. For the purpose of this agreement, the
efficiency for the baseline period will be derived from the average of the four
month period ending December 1996. This percentage was .575.
CURRENT ENERGY USE (CEU):
The current energy use of the facility for the purposes of the proposed ECM
will be the measure of the boiler efficiency as determined for the baseline
energy use using only the current operating year's data.
ENERGY SAVINGS (ES):
The energy use reduction in dollars caused by this ECM will be calculated using
the following formula:
SAVINGS IN BTU:
[(% New/% Existing)-1] X current Fuel Xxxx in BTU X [Degree Days Current/
Degree Days Baseline]
SAVINGS IN $:
[(% New/% Existing)-1] X current Fuel Xxxx in $ X [Degree Days Current/
Degree Days Baseline]
The bill's unit costs will be normalized to the costs established by the
baseline year.
9. THE METHOD BY WHICH ENERGY SAVINGS AND ENERGY COST SAVINGS
WILL BE CALCULATED DURING THE TERM OF THE ENERGY AGREEMENT:
The energy savings will be calculated annually per the methods described in
paragraph 8.
10. FINANCING OF THE ESCO'S IMPROVEMENTS:
Onsite proposes to finance the improvements through a municipal lease. The
proposed form will be Onsite's standard form of tax exempt municipal lease with
the accompanying documentation. Depending on the documentation, the ownership
of the improvements will pass to the State upon acceptance of the Notice of the
Commencement of Energy Cost Savings or upon payment of the last lease payment.
Onsite will take a secured interest with regards to the improvements. Onsite
shall have the right to assign its interest for financing purposes. The term
of the proposed financing is five years at the following rate: 6.75% for
partial funding and 6.52% for total project funding. For funding of ten (10)
years duration, the above rates will increase by 0.16. The quoted rate is
fixed for 14 days from May 12, 1997. After 14 days the rate will be adjusted
to reflect any rate changes in like term Treasury Notes. The lease or
financing agreement will indicate the moneys that the State will pay to Onsite
on a monthly basis.
10A. FINANCING OF THE ESCO'S IMPROVEMENTS:
The Owner will provide financing of the improvements through a capital
appropriation and State Treasurer Lease/Purchase financing.
11. ENERGY COST SAVINGS GUARANTEE:
Guaranteed Savings:
(Guaranteed Energy Savings The energy savings that Onsite will guarantee is
80% of the base line year savings. This is calculated as follows: fuel xxxx
for the 12 months ending April 1997 X the improvement in efficiency of the
boilers X 80% or for the 12 months ending October 1996 this calculation is
$171,892 X .244 X 80% or $ 33,500/year.
OPERATIONAL AND MAINTENANCE SAVINGS AND GUARANTEE:
The State has identified annual operations and maintenance savings of
$110,953.92. Onsite does not guarantee any of these savings.
Savings available = Guaranteed energy savings + operational and maintenance
savings
= (Energy Savings ) + $110,953.92
= $33,500 + $110,953.92
= $144,453.92
12. ESCO's Compensation
CONSTRUCTION PROGRESS PAYMENTS WILL BE MADE BASED ON THE PERCENTAGE COMPLETION
OF THE PROJECT. ONSITE WILL PROVIDE THE STATE WITH A SCHEDULE OF VALUES
SIMILAR TO THE COST ESTIMATE SHOWN IN PARAGRAPH 4 OF THIS PROPOSAL AND WILL
INVOICE MONTHLY BASED ON THE COMPLETION OF EACH LINE ITEM. IN NO EVENT,
HOWEVER, WILL PROGRESS PAYMENTS EXCEED 95% OF THE TOTAL IN PLACE CONSTRUCTION.
PROGRESS PAYMENTS WILL BE MADE WITHIN 30 DAYS OF SUBMISSION OF ONSITE'S INVOICE
OR WITHIN 30 DAYS OF THE OWNER RECEIVING TREASURER'S LOAN FUNDING. OWNER WILL
RETAIN 5% OF THE AMOUNT OF EACH PROGRESS PAYMENT UNTIL FORTY-FIVE (45) DAYS
AFTER THE ACCEPTANCE BY THE STATE OF THE NOTICE OF COMMENCEMENT OF ENERGY COST
SAVINGS AND RECEIPT OF ALL DOCUMENTS REQUIRED BY LAW AND/OR THE ENERGY SERVICES
AGREEMENT. IF ONSITE FINANCES THE TOTAL PROJECT COST, CONSTRUCTION PAYMENTS
WILL BE MADE UPON RECEIPT BY ONSITE OF DISBURSEMENT AUTHORIZATION FROM THE
STATE PURSUANT TO A CONSTRUCTION SCHEDULE.
Payment for monitoring and verification for the first year is included in the
construction costs. Monitoring and verification costs for years two through
ten will be 8% of the previous year's savings in energy. Payment will be made
within 30 days of Onsite submitting an invoice for the services at the end of
the year.
In addition, it is recognized by both parties that Onsite has guaranteed 80% of
the energy savings of these improvements, and if the guaranteed savings are not
achieved that Onsite will pay the difference.
13. Term of the Energy Agreement:
Onsite proposes that the term of the agreement be established to last through
the construction period plus ten years unless terminated sooner.
14 TERMINATION VALUES FOR EACH YEAR OF THE AGREEMENT:
Prior to Completion:
The Termination Value prior to completion will be the reasonable costs incurred
by Onsite for completed work that has been approved but not yet completed,
which costs shall be subject to reasonable verification by Customer and shall
include:
Audit costs at $0.10 per square foot, times the number of square feet
audited.
Actual subcontractor and vendor costs, including required termination
costs of subcontractors.
Actual engineering and project management costs on a
time-and-materials basis at Onsite's normal billing rates.
Actual costs incurred by Onsite in connection with procuring
financing.
Reasonable de-mobilization costs.
Interest.
Such costs shall not exceed the approved Total Project Cost.
Since the State is funding the project, after completion and acceptance by the
State, the costs for early termination of this agreement as long as all
outstanding invoices are paid in full will be $0.00.
15. PROJECT SCHEDULE:
To be added later but not to exceed 120 days after completion of the final
design for substantial completion and 150 days after completion of the final
design for final completion.
16. SUBCONTRACTED WORK:
Onsite anticipates that it will have the following subcontractors:
Engineering Design of the Improvements: HNTB Corporation
Mechanical Installation of the Improvements: The X. X. Xxxxxxx Co., Inc.
Electrical Installation of the Improvements: The X. X. Xxxxxxx Co., Inc.
17. MODIFICATIONS TO THE CONDITIONS OF THE ENERGY SERVICES AGREEMENT:
Equipment Maintenance and Owner Training
Onsite is proposing to accomplish training only. No maintenance work is
anticipated by Onsite other than that covered by warranties. The owner will be
responsible for operating and maintaining the equipment in accordance with the
requirements of the manufacturers of the specific equipment.
EQUIPMENT OPERATION
It is understood that these improvements will be at all times operated by the
State.
LIABILITY INSURANCE
Onsite's insurance policy will be endorsed to name the State as an additional
insured. This will apply to all of the required insurance except for Onsite's
professional liability and xxxxxxx'x comprehensive insurance. All insurance
certificates shall require a 45 day prior written notice to the owner prior to
cancellation. Onsite does not carry property insurance on the proposed ECM
after the State accepts the notice of the commencement of Energy Savings.
EVENTS OF DEFAULT
In the event of default by the State, all moneys owed will be deemed to have
accrued interest at 1.0% per month. In the event of default by the Onsite, the
owner recognizes that restoration of the boiler plant to its original
configuration is not possible. The State agrees that the only remedy available
to it to resolve this issue is to have the proposed improvements completed.
ENVIRONMENTAL REQUIREMENTS.
The State recognizes that in connection with the performance of the proposed
ECM, Onsite may encounter, but is not responsible for (i) asbestos or materials
containing asbestos; (ii) pollutants, hazardous wastes, hazardous materials or
contaminants, including without limitation ballasts that may contain PCBs
(collectively clauses (i) and (ii), "Hazardous Materials"); and (iii) the
storage, handling, use, transportation, treatment, disposal, discharge,
leakage, detection, removal or containment thereof. The materials and
activities listed in the foregoing sentence are referred to as "Excluded
Materials and Activities." The State agrees that if performance of work under
this Agreement involves any Excluded Materials and Activities, Onsite will
perform or arrange for the performance of such work and the Onsite
subcontractor and the State shall bear the sole risk and responsibility
therefor. Furthermore, in handling any of the State's Hazardous Materials,
Onsite neither takes title to any such property nor assumes any responsibility
for the transportation, handling or disposal of such property. Onsite's
subcontractor shall be solely responsible for disposing of the State's
property, including Hazardous Materials, in accordance with all federal, state
and local laws, statutes and regulations applicable thereto and shall provide
written evidence of the same to Onsite. All costs associated with work related
to Excluded Materials and Activities necessary for the implementation of ECMs
shall be included in the project cost. Where Onsite is aware that Excluded
Materials and Activities are involved with the implementation of the ECMs, it
shall be identified in the audit report. In furtherance of the foregoing, the
State agrees to release, indemnify, defend and hold harmless Onsite, its
assigns, consultants, officers, agents and employees of and from all costs,
claims, damages and liabilities arising out of or relating to Excluded
Materials and Activities, acts or omissions of Onsite or third parties relating
thereto, or injury caused thereby, excepting only such costs, claims, damages
or liabilities as are the result of any willful misconduct and/or gross
negligence of Onsite.
ENERGY SERVICES AGREEMENT AMENDMENT
Energy Conservation Services Amendment No. 2
Project Xx. 00-000 Xxxxxxxxx Xx. 00-000 X
Xxxxxxxx Xxxxx Multi Service Center Date August 4, 0000
Xxxxx Xxxxxx, Xxxxxxxxxx
This Amendment, when properly signed, shall be the basis on which the Subject
Agreement shall be modified.
Authorization (this sheet)
Project Completion and Compensation
Scope of Work Options
Option #2: Incorporate energy services proposal
APPROVALS: Energy Services Company Facility
Firm/Agency: Onsite Energy Corporation Northern State Multi-Service Center
Address: 00000 Xxxxxxxxxxx Xxxxxxx, Div. of Property Development
No. 308 230 General Administration Bldg.
Tukwila, Washington 98188 Xxxxxxx, XX 00000-0000
By: /s/ Xxxx X. Xxxxxx /s/ Xxx Xxxxxx
Name: Xxxx X. Xxxxxx Xxx Xxxxxx
Title: Vice President Program Manager
Date:
Authorization to Proceed
Dept. of General Administration
Engineering & Architectural Services By: /s/ X. X. Xxxxxxxx
PO Box 41012 Name: Xxxxxxx X. Xxxxxxxx, X.X.
Xxxxxxx XX 00000-0000 Title: Energy Program Manager
360-902-7272 Date:
PROJECT COMPLETION AND COMPENSATION
Energy service completion sched fee Compensation
Compensation
new previous new previous
Energy Services Proposal (Boiler) $0.00/sq ft $ 11,000.00
Energy Services Proposal (Energy) $ 41,000.00
Design 8% $ 37,600.00 $ 28,160.00
Construction Management 4% $ 18,800.00 $ 14,080.00
Bond 4% $ 18,800.00 $ 14,080.00
General Contracting Overhead & 15% $ 70,500.00 $ 52,800.00
Profit
MACC or Actual Construction Sub's cost + ohp = ins $470,000.00 $352,000.00
Costs
Construction Contingency $ 47,000.00 $ 23,300.00
State Sales Tax 7.8% $ 54,889.00 $ 38,643.00
Energy Service Sub-total= $717,589.00 $523,063.00
Maximum Energy Service Fee Amount (New + Previous) = A = $1,292,652.00
Extra Services compensation Compensation
New Previous
Extra Service Boiler/Asbestos Removal Engineering $ -0- $3,000.00
Extra Service (describe)
Extra Services Total (New + Previous) = B = $3,000.00
Energy Services Agreement Total = A + B = $1,292,652.00 + $3,000.00 +
$1,295,625.00
Total Compensation for the Energy Services:
Total Compensation:
New Previous
1. Boiler Plant Automation = $ 534,063.00 $ 534,063.00
2. Buildings on List = $ 758,589.00 $ 41,000.00
3. Extra Services = $ 3,000.00 $ 3,000.00
1 + 2 + 3 = (A) Maximum Energy Service
Fee Amount $1,295,652.00 $ 578,063.00
Value of this Amendment = $717,589.00
SCOPE OF WORK
OPTION #2: INCORPORATE ENERGY SERVICES PROPOSAL
A. In accordance with Section 2.D of the Conditions of the Agreement, the
Energy Services Proposal submitted under Project number 97-031 by Onsite
ENERGY CORPORATION and dated July 17, 1997, [and amended as requested on
August 4, 1997], is hereby incorporated into Energy Services Agreement
number 97-031 A and is made part thereof by this reference.
ONSITE ENERGY
ENERGY SERVICES PROPOSAL
ELECTRICAL SYSTEM UPGRADES
NORTHERN STATE MULTI-SERVICE CENTER
SEDRO XXXXXXX, WASHINGTON
July 17, 1997
INTRODUCTION:
Onsite Energy Corporation ("Onsite") and the State of Washington ("State")
signed an Energy Services Agreement (Agreement No. 97-031) for Energy
Conservation Services at Northern State Multi-Service Center at Sedro Xxxxxxx,
dated January 27, 1997 (the "Agreement"). A requirement of the Agreement was
that Onsite submit a proposal for Energy Services for the Electrical Project to
the State within 120 days. If the terms of this proposal are in conflict with
the terms of the original Energy Services Agreement, then the terms of this
proposal will supersede and control over the terms in the Agreement.
1. EXISTING FACILITIES:
This project is to be constructed in Building Numbers 2, 4, 10, 12, 13, 15, 16,
17, 19, 22, 27, 30, 32, and 33, the steam tunnels and various outdoor areas.
2. PROPOSED ENERGY CONSERVATION MEASURES (ECMS):
The existing lighting systems in the facilities listed in Paragraph 1. Above,
with the exception of Building Number 4, consisting mostly of core and coil
magnetic ballasts and T12 fluorescent lamps, will be replaced with electronic
ballasts and T8 fluorescent lamps. All exit signs will be replaced with new
LED exit signs with battery packs. The incandescent lighting fixtures will be
replaced with compact fluorescent fixtures and the Mercury Vapor street light
fixtures will be replaced with Metal Halide fixtures.
Old inefficient electric motors over three horsepower running twenty four hours
per day will be replaced with new high efficient electric motors.
An Energy Management System will be installed in Building Numbers 4, 12, 13,
15, 16, 17, and 32. HVAC improvements will be implemented in Building Number
32.
3. SERVICES PROPOSED:
Onsite proposes to design, construct, commission, and administer contractor's
warranty service for one year (warranties beyond one year will be provided by
the equipment manufacturer per the purchase orders and will be passed through
to the State), and provide monitoring and savings verification services for
electrical system upgrades for up to ten years. All hazardous material will be
handled in accordance with Paragraph 16. Environmental Requirements.
Monitoring and verification services will be accomplished through a site visit
by Onsite personnel to review the operation of the systems that were upgraded
and a computation and reconciliation of the energy savings. Onsite will
provide this service, quarterly for year one, annually thereafter.
4. PROJECT COST:
Based on the engineered savings and debt service payments, the maximum
allowable project cost will be $890,414. The actual project cost will be
established based on the final design and the equipment installed. The
estimated project cost is established from the below table:
Energy Audit $ 41,000
Subcontractor Costs
Lighting $ 142,390
Electric Motors $ 22,970
EMS and HVAC Modifications $ 304,640
Subtotal Subcontractor costs $470,000
Markup (per the Energy Services Agreement)
Engineering @ 8% $ 37,600
Construction management @ 4% $ 18,800
Bonding Expense @ 4% $ 18,800
Onsite overhead and profit @ 15% $ 70,500
Contingency @ 10% $ 47,000
SUBTOTAL MARKUP $192,700
Onsite's price to the State without taxes $703,700
Taxes at 7.8% of construction $ 54,889
E &AS PROJECT MANAGEMENT FEES $ 11,850
TOTAL PRICE TO THE STATE $770,439
Project costs were established from firm bids for labor and materials for the
lighting and electric motor retrofits. Project costs for the EMS and HVAC
modifications are Means estimates.
A Project Book will be maintained with copies of all bids and Means estimates
for the Electrical Project. Individual budgets for lighting, electric motors,
EMS and HVAC will be prepared detailing labor and materials projected costs.
Actual costs will be reconciled on a line item basis for each budget.
5. STANDARDS OF COMFORT AND SERVICE APPROPRIATE FOR THE FACILITY:
The comfort and habitability of the facilities resulting from the installation
of the proposed ECM's will be improved as follows: full spectrum lamps will
reduce eye strain and produce consistent lighting levels throughout the
facilities retrofit; temperature variance within a facility and within a room
will be reduced; and, outside air percentages of ventilation air will be
maintained within the standard for the facility use.
6. RECOMMENDATIONS FOR REPLACEMENT OF EXISTING EQUIPMENT AND RECOMMENDATIONS
FOR IMPROVEMENTS TO EXISTING EQUIPMENT AND OPERATING CONDITIONS.
The existing HVAC system in both sections of Administration Building #32 should
be replaced as soon as practical.
The existing maintenance program monitoring electric motor current draw to
indicate the need for filter maintenance and indicate abnormalities in air
handlers should be expanded to include all air handler motors. In addition to
the EMS proposed, thermostats in other buildings should be installed with
"night set-back" capabilities for periods when buildings are unoccupied.
7. BASELINE ENERGY CONSUMPTION FOR THE ECM:
The baseline energy use for the various systems in the facilities was
determined using commonly accepted engineering practices and basic spreadsheet
and bin analysis. Spreadsheets for each system retrofitted in each facility
are included in Attachment 2, Energy Audit.
The energy baseline period is the same as the boiler upgrades, the 12 month
period ending April 1997.
8. THE ESTIMATED ENERGY SAVINGS AND ENERGY COST SAVINGS:
Baseline Energy Use (BEU):
LIGHTING. The baseline energy use of the facility for the purposes of the
proposed ECM was determined by spreadsheet analysis. The existing kW use for
each lighting fixture was determined from manufacturer's published data. The
operating hours for each lighting fixture was determined from lighting logger
run time data and from the current facility operating hours as provided by
state personnel. The kWh is the product of the kW and operating hours.
MOTORS. The baseline energy use of each individual motor was determined by
spreadsheet analysis. Each motor's energy use was measured while operating
with a multi-meter. Each motor operates continuously, twenty four hours per
day, three hundred sixty five days a year.
EMS/HVAC. The energy baseline consists of a computer bin model of the existing
six buildings that were audited. The model simulates the existing conditions
as described in the narrative section of the audit. Currently, the time clocks
for building occupancy setbacks are either missing or in need or repair. The
building HVAC systems need to be reconfigured to more closely follow the need
of the building occupants. In some cases, 100% outside air systems need to be
modified to permit partial recirculation. Finally, the control systems need to
more accurately control the HVAC systems to define how the buildings are
occupied and used.
The baseline model was made using the conditions that were noted in the energy
audit. The baseline period is the 12 month period ending April 1997. The
computer models were then compared to the energy xxxx of the facility and
analyzed both on a square footage basis and on the percentage of the occupied
space that the buildings represent. The model to represents a good
approximation of the energy usage.
ENERGY SAVINGS (ES):
The energy use reduction in kW, annual kWh savings, annual kbtu savings and
annual dollar savings resulting from the installation of each ECM is calculated
on the spreadsheets using the current Puget Power rate schedule and current
natural gas costs for the ECM's is detailed on the spreadsheets in Attachment 2
and is summarized below:
ECM KW REDUCTION KWH SAVINGS kbtu savings $ SAVINGS
Lighting 128.12 464,029 0 $ 27,420
Motors 14.90 239,059 0 $ 10,980
EMS/HVAC N/A * 9,907,872 $ 44,060**
EXCESS SAVINGS FROM BOILER PROJECT $ 33,500
TOTALS 143.02 703,088 9,907,872 $115,960
* Included in Motors
** Based on the existing boiler plant. After the boiler project is
complete, the EMS/HVAC savings will be $31,370.
The total dollar savings above, $115,960 is the amount of money available
annually for debt service payments and monitoring costs. With $115,960
available annually for debt service, the maximum allowable project cost is
$890,414 at an interest rate of 5.5% and is indicated in Paragraph 4. above.
9. THE METHOD BY WHICH ENERGY SAVINGS AND ENERGY COST SAVINGS WILL BE
CALCULATED DURING THE TERM OF THE ENERGY AGREEMENT:
The energy savings will be calculated annually per the methods described in
paragraph 7. Condensate meters will be installed to validate the EMS/HVAC
savings.
10. FINANCING OF THE ESCO'S IMPROVEMENTS:
Onsite proposes to finance the improvements through a municipal lease. The
proposed form will be Onsite's standard form of tax exempt municipal lease with
the accompanying documentation. Depending on the documentation, the ownership
of the improvements will pass to the State upon acceptance of the Notice of the
Commencement of Energy Cost Savings or upon payment of the last lease payment.
Onsite will take a secured interest with regards to the improvements. Onsite
shall have the right to assign its interest for financing purposes. The term
of the proposed financing is ten years at a rate of 6.45%. The quoted rate is
fixed for 30 days. The lease or financing agreement will indicate the moneys
that the State will pay to Onsite on a monthly basis.
10A. FINANCING OF THE ESCO'S IMPROVEMENTS: THE OWNER WILL PROVIDE FINANCING
OF THE IMPROVEMENTS THROUGH STATE TREASURER LEASE/PURCHASE FINANCING.
11. ENERGY COST SAVINGS GUARANTEE:
Guaranteed Savings: The energy savings that Onsite will guarantee $67,692 per
year ($33,500 is guaranteed in the boiler project bringing the total guarantee
to $101,192 which is the annual debt service payments for the $770,439 project
cost in paragraph 4 above) based on the analysis spreadsheets with the
operating hours as indicated in the spreadsheet analyses. Onsite will
guarantee the kW reduction. Onsite will not guarantee the annual operating
hours with the operation of the systems in the control of the State.
The energy savings guarantee is based on energy savings that will be achieved
with the current use of the facilities and the kW, kWh and kbtu savings in the
table in Paragraph 8. above. Using the cost for energy during the baseline
period, the year ended April 1997, the dollar savings are $67,692 per year.
The owner will be responsible for any shortfall in energy savings caused by any
change of use of any of the facilities retrofit and any fluctuations in the
price the State pays for energy.
12. ESCO'S COMPENSATION.
Construction progress payments will be made through the State Treasurer's
Lease/Purchase program upon receipt of approved invoices and loan agreements in
even numbered months. Onsite will provide the State with a schedule of values
similar to the cost estimate shown in paragraph 4 of this proposal and will
provide invoices on a bi-monthly basis upon the completion of each line item
and the commencement of energy cost savings. In no event, however, will
progress payments exceed 95% of the total in place construction until final
completion and acceptance by the State. Progress payments will be made upon
execution of the appropriate disbursement authorization. Owner will retain 5%
of the amount of each progress payment until forty-five (45)days after the
acceptance by the State of the Notice of Commencement of Energy Cost Savings
and receipt of all documents required by law and/or the Energy Services
Agreement.
Payment for monitoring and verification for the first year is included in the
construction costs. Monitoring and verification costs will be 8% of the
previous year's savings in energy per year for a period of up to ten years.
Payment will be made by the State within 30 days of Onsite submitting an
invoice for the services at the end of the year. If the overall savings from
the project are insufficient to pay the annual debt service plus the monitoring
costs, then the monitoring costs will be reduced to four-sevenths (4/7) of
difference between the actual savings and the annual debt service.
In addition, it is recognized by both parties that Onsite has guaranteed that
the energy savings will be sufficient to pay the annual debt service of these
improvements, and if the guaranteed savings are not achieved, that Onsite will
pay the difference.
13. TERM OF THE ENERGY AGREEMENT:
Onsite proposes that the term of the agreement be established to last through
the construction period plus ten years unless terminated sooner.
14. TERMINATION VALUES FOR EACH YEAR OF THE AGREEMENT:
PRIOR TO COMPLETION:
The Termination Value prior to completion will be the reasonable costs incurred
by Onsite for work that has been approved, which costs shall be subject to
reasonable verification by Customer and shall include:
Audit costs at $41,000.
Actual subcontractor and vendor costs, including required termination
costs of subcontractors.
Actual engineering and project management costs on a
time-and-materials basis at Onsite's normal billing rates.
Actual costs incurred by Onsite in connection with procuring
financing.
Reasonable de-mobilization costs.
Interest.
Such costs shall not exceed the approved Total Project Cost.
UPON COMPLETION :
With State Treasurer Lease/Purchase Financing, Zero Dollars ($0.00) after all
payments have been received from the State Treasurer.
15. PROJECT SCHEDULE:
Not to exceed 180 days after approval of this proposal and amendment to the
Energy Services Agreement.
16. SUBCONTRACTED WORK:
Onsite anticipates that it will have the following subcontractors:
Electrical Installation of the Improvements: Xx Xxxxxxxx Electric, Inc.
Lighting and Control Systems
Xxxxxxx Controls
X.X. Xxxxxxx Co., Inc.
17. MODIFICATIONS TO THE CONDITIONS OF THE ENERGY SERVICES AGREEMENT:
Equipment Maintenance and Owner Training
No maintenance work is anticipated by Onsite other than that covered by
warranties. The owner will be responsible for operating and maintaining the
equipment in accordance with the requirements of the manufacturers of the
specific equipment. Onsite is proposing to accomplish training only for the
EMS system. Onsite will develop a training program to include initial training
for owner designated personnel, refresher training after one year.
EQUIPMENT OPERATION
It is understood that these improvements will be at all times operated by the
State.
LIABILITY INSURANCE
Onsite's insurance policy will be endorsed to name the State as an additional
insured. This will apply to all of the required insurance except for Onsite's
professional liability and xxxxxxx'x comprehensive insurance. All insurance
certificates shall require a 45 day prior written notice to the owner prior to
cancellation. Onsite dose not carry property insurance on the proposed ECM
after the State accepts the notice of the commencement of Energy Savings.
EVENTS OF DEFAULT
In the event of default by the State, all moneys owed will be deemed to have
accrued interest at 1.0% per month. The State agrees that the only remedy
available to it to resolve this issue is to have the proposed improvements
completed.
TERMINATION FOR THE CONVENIENCE OF THE OWNER
Moneys owed to Onsite upon termination will be determined by the termination
schedule in Section 14 of this proposal.
ENVIRONMENTAL REQUIREMENTS.
The State recognizes that in connection with the performance of the proposed
ECM, Onsite may encounter, but is not responsible for (i) asbestos or materials
containing asbestos; (ii) pollutants, hazardous wastes, hazardous materials or
contaminants, including without limitation ballasts that may contain PCBs
(collectively clauses (i) and (ii), "Hazardous Materials"); and (iii) the
storage, handling, use, transportation, treatment, disposal, discharge,
leakage, detection, removal or containment thereof. The materials and
activities listed in the foregoing sentence are referred to as "Excluded
Materials and Activities." The State agrees that if performance of work under
this Agreement involves any Excluded Materials and Activities, Onsite will
perform or arrange for the performance of such work and the Onsite
subcontractor and the State shall bear the sole risk and responsibility
therefor. Furthermore, in handling any of the State's Hazardous Materials,
Onsite neither takes title to any such property nor assumes any responsibility
for the transportation, handling or disposal of such property. Onsite's
subcontractor shall be solely responsible for disposing of the ballasts that
may contain PCB's and the recycling of fluorescent lamps, in accordance with
all federal, state and local laws, statutes and regulations applicable thereto
and shall provide written evidence of the same to Onsite. All costs associated
with work related to Excluded Materials and Activities necessary for the
implementation of ECMs shall be included in the project cost. Where Onsite is
aware that Excluded Materials and Activities are involved with the
implementation of the ECMs, it shall be identified in the audit report. In
furtherance of the foregoing, the State agrees to release, indemnify, defend
and hold harmless Onsite, its assigns, consultants, officers, agents and
employees of and from all costs, claims, damages and liabilities arising out of
or relating to Excluded Materials and Activities, acts or omissions of Onsite
or third parties relating thereto, or injury caused thereby, excepting only
such costs, claims, damages or liabilities as are the result of any willful
misconduct and/or gross negligence of Onsite.
