The Haverhill City Council Tuesday will consider a request to borrow up to $2.5 million for planned energy improvements at up to 11 city school buildings.
On the agenda, Mayor James J. Fiorentini is asking the council to approve a bond order authorizing the city to fund a maximum 15-year energy services contract (ESCO) with Ameresco Inc., Framingham, as backed by the Haverhill School Committee Sept. 24. The council placed the item on file for two weeks Sept. 29.
“The memorandum of understanding approved by the school committee states that the school department will pay the principal with the debt related to this order through the savings generated by the implementation of the energy conservation measures. The city will be responsible for appropriating the interest portion only,” Fiorentini said. “We estimate the interest to be about $30,000 per year. Based on the initial proforma, the ESCO will generate a savings of up to $270,000 annually.”
Under the bond order, the mayor also “is authorized to contract for and expend any federal or state aid or energy rebates or similar payments available for the project.” It also allows the mayor to “take any other action necessary or convenient to carry out these projects.”
The contract, calling for a 12-month implementation plan, is expected to save $270,259 annually and provide a positive cash flow of $38,664 for the school department, according to Energy Manager and Purchasing Agent Orlando Pacheco.
As reported earlier by WHAV, the positive cash flow would be invested in roof upgrades at Consentino School and Haverhill High School swimming pool. Also, under an amendment offered by school committee President Scott W. Wood Jr., “the savings generated from the implementation of the energy services contract above and beyond the debt services will be budgeted as determined by the Haverhill School Committee.”
The Haverhill city council meets at 7 p.m., Tuesday, in council chambers at Haverhill City Hall.
The fact that Ameresco is calculating ‘expected’ saving right down to a specific dollar figure should be based on the factors associated with costs….Total watts of electricity currently being consumed, hours of usage, and cost per kilowatt hour. If should be very easy for them to explain where the savings will come in. In proposals like this those numbers are ‘always’ inflated to make the savings look good. Factor in the potential of a lower cost per KWH with the city’s aggregation program and it goes without saying the pay back is going to much longer than this proposal suggests. In contracts like this it ‘always’ is.
One watt of electricity being consumed for 12 hours/day, 200 days/year (schools are not open all year round) at a rate of $00.13KWH costs $00.31 per year. To save $270,000.00 annually 871,000 watts of electricity would have to be removed from consumption. That’s a reach if there ever was one.
But what’s it all matter anyway? By the end of the 15 year contract mayor Taxman will have raised taxes by over $60MILLION ($4Million/year X 15 years) at his current rate of property tax increases of 2.5% a year. And don’t you just love compounding??? Just think…Haverhill taxpayers are now paying over $100,000.00 extra each year extra in taxes just for the 2.5% tax increase from the previous year ($4Million X 2.5% = $100,000.00).
Isn’t math fun?