, Newburyport, MA

April 5, 2013

Pentucket unveils new plan to save energy, money


---- — WEST NEWBURY – Energy efficiencies and infrastructure upgrades dominated the agenda at the Pentucket Regional School Committee’s first meeting of the month.

After a lengthy discussion the board endorsed a plan by the town of Merrimac to enter into a performance contract with Peregrine Energy Group as a way to upgrade the town’s infrastructure and increase energy efficiencies. Merrimac officials sought buy in from the Pentucket board because the Donahue and Sweetsir Elementary schools are included in the contract.

The board also OK’d a plan to seek funds for the regional middle school under the state’s new accelerated repair program and agreed to lock in a 3-year price for the purchase of natural heating gas.

Performance contracting provides municipalities with an alternative to the traditional bid and design process, Steve Wiseman, Vice President of Peregrine Energy Group, explained to committee members during his power point presentation on Tuesday.

Instead of seeking bids on a project-by-project basis, Peregrine acts on behalf of the town to hire one contractor -- in this case, Ameresco -- to complete 66 upgrades on multiple facilities through out the town. Ameresco is an energy services company -- or ESCO -- that integrates engineering, design, purchasing, construction, and commissioning to improve project quality. A national company with a 20-year track record, its $1.02 million bid estimate was the lowest of the 8 ESOPs that applied for the job.

In 2011 Ameresco conducted an audit of Merrimac’s assets and the town then picked projects for a more detailed study. Included in the final proposal were nine projects for the town’s elementary schools -- six at Donahue and three at Sweetsir. The town authorizes the work and secures the financing, but as part of the process, the district must agree on a cost sharing approach for these specific upgrades based on the dollar value of the work and the potential savings in future energy costs.

Cost to Pentucket is estimated at $280,522 with annual savings of $59,203 projected, establishing a simple payback period of 4.74 years. Under the agreement the school district identifies when the work can be completed to minimize impact on students.

Once the entire project is completed in Merrimac, the debt for the schoolwork will be covered by energy savings retained in the school’s operating budget. No tax rate increases will be necessary, Wiseman stressed. And best of all, the ESCO guarantees that the energy saved will meet or exceed projections. If not, Ameresco will cover the difference. Actual savings are analyzed and reconciled against the guarantee by the ESCO annually and as Owner’s Agent, Peregrine verifies the savings.

Some committee members worried that the cost savings could be difficult for the district to prove and noted that calculations used by the company to provide estimates were taken before the actual savings from the latest energy improvements to the schools through the state’s Green Repair program were available to be factored in.

But Pentucket Business Manager Michael Bergeron said he saw it as a “model project” that he hopes can be replicated in all Pentucket schools. Bergeron explained that the way it works, the utility line items on the budget would remain stagnant even as annual savings were realized. Once the costs were paid off for the work in Merrimac, the continued savings would benefit all three-district towns because the cost Pentucket budgeted for energy would then decrease. Ultimately the board agreed to endorse the plan.

It then went on to approve a Statement of Interest identifying $1.5 million worth of upgrades to covering remediation to a portion of the middle school roof over the auditorium, replacing the boiler system and generator, re-caulking and weather stripping for windows, and addressing asbestos remediation in some classrooms.

Although the district has identified the high school as its long-term priority in terms of the state’s School Building Authority fund process, this targeted work at the middle school could fall under a new accelerated repair program that the state is offering. It is only open to those projects that can access funding within two years. As of right now, the state program is offering around 50% reimbursement for the work, Bergeron said.

The regional financial advisory board endorses the idea and sees it as a way to address these immediate needs while the towns and district work to build consensus on the larger high school renovation project --a process that Superintendent Jeff Mulqueen estimates could still be 6 years down the road.

Bergeron concluded Tuesday meeting by convincing the board to lock in a 3-year price plan for natural heating gas. Increased demands for natural gas across the county couple with storage issue for the resource in New England are causing a rise in prices locally, he noted.

Mulqueen announced that a celebration of upgrades to the auditorium and other district improvements will take place at 5:30 p.m. prior to the next committee meeting at 6:30 p.m. on April.23.