Bill Text: FL S1594 | 2013 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Guaranteed Energy, Water, and Wastewater Performance Savings Contracting Act

Spectrum: Slight Partisan Bill (? 3-1)

Status: (Passed) 2013-06-10 - Chapter No. 2013-135 [S1594 Detail]

Download: Florida-2013-S1594-Introduced.html

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       Florida Senate - 2013                                    SB 1594
       
       
       
       By Senator Bradley
       
       
       
       
       7-00569A-13                                           20131594__
    1                        A bill to be entitled                      
    2         An act relating to the Guaranteed Energy, Water, and
    3         Wastewater Performance Savings Contracting Act;
    4         amending s. 489.145, F.S.; revising the terms
    5         “agency,” “energy, water, and wastewater efficiency
    6         and conservation measure,” and “energy, water, or
    7         wastewater cost savings”; deleting a reference to life
    8         cycle cost calculations; providing that a contract may
    9         provide for repayments to a lender of an installation
   10         construction loan in installments for a period not to
   11         exceed 20 years; requiring a contract to provide that
   12         repayments to a lender of an installation construction
   13         loan may be made over time, not to exceed 20 years
   14         from a certain date; requiring a contract to provide
   15         for a certain amount of repayment to the lender of the
   16         installation construction loan within 2 years of a
   17         specified date; providing that certain improvements
   18         may be included in a performance contract if certain
   19         conditions are satisfied; authorizing certain facility
   20         alterations to be included in a performance contract
   21         and to be supervised by the performance savings
   22         contractor; limiting the time allotted to the Office
   23         of the Chief Financial Officer to review and approve
   24         an agency’s guaranteed energy, water, and wastewater
   25         performance savings contract; conforming language;
   26         providing an effective date.
   27  
   28  Be It Enacted by the Legislature of the State of Florida:
   29  
   30         Section 1. Paragraphs (a) through (c) of subsection (3),
   31  paragraphs (c) and (j) of subsection (4), and subsections (5)
   32  and (6) of section 489.145, Florida Statutes, are amended to
   33  read:
   34         489.145 Guaranteed energy, water, and wastewater
   35  performance savings contracting.—
   36         (3) DEFINITIONS.—As used in this section, the term:
   37         (a) “Agency” means the state, a municipality, or a
   38  political subdivision, a county or city school district, or an
   39  institution of higher education, including all state
   40  universities, colleges, and technical colleges.
   41         (b) “Energy, water, and wastewater efficiency and
   42  conservation measure” means a training program incidental to the
   43  contract, facility alteration, or equipment purchase to be used
   44  in a building retrofit, addition, or renovation, or in new
   45  construction, including an addition to existing facilities or
   46  infrastructure, which reduces energy or water consumption,
   47  wastewater production, or energy-related operating costs and
   48  includes, but is not limited to:
   49         1. Installing or modifying:
   50         a. Insulation of the facility structure and systems within
   51  the facility.
   52         b.2. Window and door systems that reduce energy consumption
   53  or operating costs, such as storm windows and doors, caulking or
   54  weatherstripping, multiglazed windows and doors, heat-absorbing,
   55  or heat-reflective, glazed and coated window and door systems,
   56  additional glazing, and reductions in glass area, and other
   57  window and door system modifications that reduce energy
   58  consumption.
   59         c.3. Automatic energy control systems.
   60         4. Heating, ventilating, or air-conditioning system
   61  modifications or replacements.
   62         5. Replacement or modifications of lighting fixtures to
   63  increase the energy efficiency of the lighting system, which, at
   64  a minimum, must conform to the applicable state or local
   65  building code.
   66         d.6. Energy recovery systems.
   67         e.7. Cogeneration systems that produce steam or forms of
   68  energy such as heat, as well as electricity, for use primarily
   69  within a facility or complex of facilities.
   70         8. Energy conservation measures that reduce British thermal
   71  units (Btu), kilowatts (kW), or kilowatt hours (kWh) consumed or
   72  provide long-term operating cost reductions.
   73         f.9. Renewable energy systems, such as solar, biomass, or
   74  wind systems.
   75         g.10. Devices that reduce water consumption or sewer
   76  charges.
   77         h.11. Energy storage systems, such as fuel cells and
   78  thermal storage.
   79         i.12. Energy-generating technologies, such as
   80  microturbines.
   81         j. Automated, electronic, or remotely controlled
   82  technologies, systems, or measures that reduce utility or
   83  operating costs.
   84         k. Software-based systems that reduce facility management
   85  or other facility operating costs.
   86         l. Energy information and control systems that monitor
   87  consumption, redirect systems to optimal energy sources, and
   88  manage energy-using equipment.
   89         2. Replacing or modifying:
   90         a. Heating, ventilating, or air-conditioning systems.
   91         b. Lighting fixtures to increase the energy efficiency of
   92  the lighting system without increasing the overall illumination
   93  of a building, unless the increase in illumination is necessary
   94  to conform to the applicable state or local building code.
   95         3. Implementing a program to reduce energy costs through
   96  rate adjustments, load shifting to reduce peak demand, or the
   97  use of alternative energy suppliers, including, but not limited
   98  to, demand response programs, changes to more favorable rate
   99  schedules, negotiation of lower rates using new suppliers, or
  100  auditing utility billing and metering.
  101         4. An improvement that reduces solid waste and associated
  102  removal costs.
  103         5. Meter replacement, installation of an automated meter
  104  reading system, or other construction, modification,
  105  installation, or remodeling of water, electric, gas, fuel,
  106  communication, or other supplied utility system.
  107         6. Any other energy conservation measure that reduces
  108  British thermal units (Btu), kilowatts (kW), or kilowatt hours
  109  (kWh); reduces fuel or water consumption in the building or
  110  waste water production; or reduces an operating cost or provides
  111  long-term cost reductions.
  112         7.13. Any other repair, replacement, or upgrade of existing
  113  equipment that produces measurable savings, or any other
  114  construction, modification, installation, or remodeling that is
  115  approved by an agency and that is within the legislative
  116  authority granted the agency, such as an energy conservation
  117  measure.
  118         8. Any other measure not otherwise defined in this chapter
  119  which is designed to reduce utility consumption, revenue
  120  enhancements, wastewater cost savings, avoided capital costs, or
  121  similar efficiency gains to a governmental unit.
  122         (c) “Energy, water, or wastewater cost savings” means a
  123  measured reduction in the cost of fuel, energy or water
  124  consumption, wastewater production, and stipulated operation and
  125  maintenance, and identified avoided capital savings created from
  126  the implementation of one or more energy, water, or wastewater
  127  efficiency or conservation measures when compared with an
  128  established baseline for the previous cost of fuel, energy or
  129  water consumption, wastewater production, and stipulated
  130  operation and maintenance, and identified avoided capital costs.
  131         (4) PROCEDURES.—
  132         (c) An The agency may enter into a guaranteed energy,
  133  water, and wastewater performance savings contract with a
  134  guaranteed energy, water, and wastewater performance savings
  135  contractor if the agency finds that the amount the agency would
  136  spend on an the energy, water, and wastewater efficiency and
  137  conservation measure is unlikely to measures will not likely
  138  exceed the amount of the cost savings for up to 20 years after
  139  from the date of installation, based on the life cycle cost
  140  calculations provided in s. 255.255, if the recommendations in
  141  the report were followed and if the qualified provider or
  142  providers give a written guarantee that the cost savings will
  143  meet or exceed the costs of the system. However, actual computed
  144  cost savings must meet or exceed the estimated cost savings
  145  provided in each agency’s program approval. Baseline adjustments
  146  used in calculations must be specified in the contract. The
  147  contract may provide for repayment to the lender of the
  148  installation construction loan through installment payments for
  149  a period not to exceed 20 years.
  150         (j) In determining the amount the agency will finance to
  151  acquire the energy, water, and wastewater efficiency and
  152  conservation measures, the agency may reduce such amount by the
  153  application of any grant moneys, rebates, or capital funding
  154  available to the agency for the purpose of buying down the cost
  155  of the guaranteed energy, water, and wastewater performance
  156  savings contract. However, in calculating the life cycle cost as
  157  required in paragraph (c), the agency shall not apply any
  158  grants, rebates, or capital funding.
  159         (5) CONTRACT PROVISIONS.—
  160         (a) A guaranteed energy, water, and wastewater performance
  161  savings contract must include a written guarantee that may
  162  include, but is not limited to the form of, a letter of credit,
  163  insurance policy, or corporate guarantee by the guaranteed
  164  energy, water, and wastewater performance savings contractor
  165  that annual cost savings will meet or exceed the amortized cost
  166  of energy, water, and wastewater efficiency and conservation
  167  measures.
  168         (b) The guaranteed energy, water, and wastewater
  169  performance savings contract must provide that all repayments
  170  payments to the lender of the installation construction loan,
  171  except obligations on termination of the contract before its
  172  expiration, may be made over time, but may not to exceed 20
  173  years from the date of complete installation and acceptance by
  174  the agency, and that the annual savings are guaranteed to the
  175  extent necessary to make annual payments to satisfy the
  176  guaranteed energy, water, and wastewater performance savings
  177  contract.
  178         (c) The guaranteed energy, water, and wastewater
  179  performance savings contract must require that the guaranteed
  180  energy, water, and wastewater performance savings contractor to
  181  whom the contract is awarded provide a 100-percent public
  182  construction bond to the agency for its faithful performance, as
  183  required by s. 255.05.
  184         (d) The guaranteed energy, water, and wastewater
  185  performance savings contract may contain a provision allocating
  186  to the parties to the contract any annual cost savings that
  187  exceed the amount of the cost savings guaranteed in the
  188  contract.
  189         (e) The guaranteed energy, water, and wastewater
  190  performance savings contract must shall require the guaranteed
  191  energy, water, and wastewater performance savings contractor to
  192  provide to the agency an annual reconciliation of the guaranteed
  193  energy or associated cost savings. If the reconciliation reveals
  194  a shortfall in annual energy or associated cost savings, the
  195  guaranteed energy, water, and wastewater performance savings
  196  contractor is liable for such shortfall. If the reconciliation
  197  reveals an excess in annual cost savings, the excess savings may
  198  be allocated under paragraph (d) but may not be used to cover
  199  potential energy or associated cost savings shortages in
  200  subsequent contract years.
  201         (f) The guaranteed energy, water, and wastewater
  202  performance savings contract must provide for repayment payments
  203  to the lender of the installation construction loan of not less
  204  than one-twentieth of the price to be paid within 2 years from
  205  the date of the complete installation and acceptance by the
  206  agency using straight-line amortization for the term of the
  207  loan, and the remaining costs to be paid at least quarterly, not
  208  to exceed a 20-year term, based on life cycle cost calculations.
  209         (g) The guaranteed energy, water, and wastewater
  210  performance savings contract may extend beyond the fiscal year
  211  in which it becomes effective; however, the term of a any
  212  contract expires at the end of each fiscal year and may be
  213  automatically renewed annually for up to 20 years, subject to
  214  the agency making sufficient annual appropriations based upon
  215  continued realized energy, water, and wastewater savings.
  216         (h) The guaranteed energy, water, and wastewater
  217  performance savings contract must stipulate that it does not
  218  constitute a debt, liability, or obligation of the state.
  219         (i) An improvement that is not causally connected to an
  220  energy conservation measure may be included in a performance
  221  contract if:
  222         1. The total value of the improvement does not exceed 15
  223  percent of the total value of the performance contract; and
  224         2. The improvement is necessary to conform to a law, a
  225  rule, or an ordinance, or an analysis within the performance
  226  contract demonstrates that there is an economic advantage to the
  227  governmental unit implementing an improvement as part of the
  228  performance contract.
  229         (j) A facility alteration that includes expenditures that
  230  are required to properly implement other energy conservation
  231  measures may be included as part of a performance contract. In
  232  such case, notwithstanding any provision of law, the
  233  installation of these additional measures may be supervised by
  234  the performance savings contractor.
  235         (6) PROGRAM ADMINISTRATION AND CONTRACT REVIEW.—The
  236  Department of Management Services, with the assistance of the
  237  Office of the Chief Financial Officer, shall, within available
  238  resources, provide technical content assistance to state
  239  agencies contracting for energy, water, and wastewater
  240  efficiency and conservation measures and engage in other
  241  activities considered appropriate by the department for
  242  promoting and facilitating guaranteed energy, water, and
  243  wastewater performance contracting by state agencies. The
  244  Department of Management Services shall review the investment
  245  grade audit for each proposed project and certify that the cost
  246  savings are appropriate and sufficient for the term of the
  247  contract. The Office of the Chief Financial Officer, with the
  248  assistance of the Department of Management Services, shall,
  249  within available resources, develop model contractual and
  250  related documents for use by state agencies. Before Prior to
  251  entering into a guaranteed energy, water, and wastewater
  252  performance savings contract, a any contract or lease for third
  253  party financing, or any combination of such contracts, a state
  254  agency shall submit such proposed contract or lease to the
  255  Office of the Chief Financial Officer for review and approval.
  256  The Office of the Chief Financial Officer shall complete its
  257  review and approval within 10 business days after receiving the
  258  proposed contract or lease. A proposed contract or lease must
  259  shall include:
  260         (a) Supporting information required by s. 216.023(4)(a)9.
  261  in ss. 287.063(5) and 287.064(11). For contracts approved under
  262  this section, the criteria may, at a minimum, include the
  263  specification of a benchmark cost of capital and minimum real
  264  rate of return on energy, water, or wastewater savings against
  265  which proposals shall be evaluated.
  266         (b) Documentation supporting recurring funds requirements
  267  in ss. 287.063(5) and 287.064(11).
  268         (c) Approval by the head of the agency or his or her
  269  designee.
  270         (d) An agency measurement and verification plan to monitor
  271  cost savings.
  272  
  273  The Office of the Chief Financial Officer shall not approve any
  274  contract submitted under this section from a state agency that
  275  does not meet the requirements of this section.
  276         Section 2. This act shall take effect July 1, 2013.