2010 Georgia Ballot Amendment 4 – VOTE YES
by Bill Simon
AMENDMENT 4 – Authorize Georgia To Engage In Multi-Year “Energy Performance” Contracts
Issue Background: Currently, there are hundreds of buildings the state owns that have very old and very costly heating and air systems to heat and cool the buildings, as well as lighting and plumbing systems. The state is shelling-out millions of dollars in operating costs, a significant portion of which could be saved were the state to upgrade these systems to be more energy and cost efficient.
However, the way one normally upgrades buildings to be more energy and cost efficient is to bid the project out and directly pay upfront for the upgrades. Problem with this method is that it requires upfront cash flow which, as everyone knows, the state is strapped for.
Enter-in the concept of the Energy Saving Performance Contract (ESPC). Here are a few good explanatory points from their Website on this:
Performance contracts divert funds that would be spent on utility bills into building improvements that lower energy consumption. The key feature of an ESPC is that upfront costs are paid by the energy services company (ESCO) via guaranteed energy savings. Under performance contracts, the ESCO also bears all of the risk because the company guarantees to pay any difference between guaranteed savings and actual savings.
Why don’t we have ESPCs in Georgia?
Some provisions in Georgia’s Constitution prohibit multiyear contracts and prevent the state from partnering with private companies, making Georgia one of the few states in the U.S. that cannot use this tool. The legislature overwhelmingly voted to propose the amendment and it now must be ratified by voters.
What are the benefits of ESPCs to the state?
ESPCs would allow Georgia to fast-track energy saving improvements to state-owned buildings. With ESPCs, improvements can happen immediately at no cost to the state. Without ESPCs, building improvements must be made using cash or general obligation debt, which slows down the process, wastes energy and diverts funds from other critical needs.
How do ESPCs help the environment?
ESPCs help install such technologies as efficient heating and air conditioning, low consumption lighting, geothermal energy systems, solar energy systems, and other innovations that lower overall energy consumption. In turn, this reduces state costs for energy and water.
This is the link to the Website that has more details about this issue, as well as provides several good Case Studies on how it has been successfully implemented in other states.
Really…this is a no-risk deal for the state to partake in. System upgrades are financed by only if there are savings experienced between what the state would have paid and what they are paying for with the upgrade. PV finds this to be a brilliant concept to employ.
PV Recommends: Vote YES on Amendment 4
October 20th, 2010 at 3:56 pm
I’m suspicious.
Does the state government not have people who know how to use modern systems? It is not believable that the vendor has “special knowhow” that enables them to supply savings that any competent manager of major commercial buildings couldn’t match. And, the fact that they allow the returns to be paid to them over time is no better than borrowing the money to upgrade buildings. Miss a payment and see how they react. My expectastion is that they will identify all kinds of potential savings. Our people will decide some are too difficult because of retrofitting old buildings, some are not cost effective (i.e., invest a million bucks to save a hundred bucks). They will claim credit for the savings regardless of whether we actually implement it. You will not hear about this because the people involved will be inclined to sweep it under the rug so they don’t look foolish. There are companies that will do this for your home, although I haven’t seen much of this recently. Probably other states do it because it bypasses usual government bureaucratic approval and funding processes.
October 21st, 2010 at 12:47 pm
Whose brother-in-law is running this one?
I’ve got a better idea–decrease the size of the state government so they can shut down the old decrepit buildings and it’s a win-win for the environment and the taxpayer.
October 27th, 2010 at 7:45 pm
What’s the benefit to me to vote yes? I only see a bunch of under-handed crooks getting rich on this one.
October 31st, 2010 at 8:19 am
The news that Gwinnett county wasted all the TAX PAYERS money is another reason why I am voting no on this. Im sure this is not the only county that is wasteful. Be responsible, do what you’re supposed to, then see where we are–I may vote yes then. As of now, I see them as nothing but crooks.
http://www.ajc.com/news/gwinnett/grand-jury-gwinnett-commission-707135.html