Maryland Municipal League How to Fund Energy Projects in a Post-Stimulus World
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1 Maryland Municipal League How to Fund Energy Projects in a Post-Stimulus World Mayor John R. Tabori, University Park Chuck Wilson, STEP-UP Program Director 1
2 A Post-Stimulus World Possible E-Funding Scenarios Rising energy prices and rising program demand Decrease in federal funding Flat / declining state funding Utility funding level Post-Stimulus Imperatives Deploy lowest-cost program options with proven impact Share fixed program costs with neighboring towns Maximize leverage of the remaining utility / public funds Plow energy cost savings back into programs 2
3 What is STEP-UP? A 3-year grant from the U.S. Department of Energy to the Town Of University Park, Maryland (August, 2010 through July, 2013) To create a model community energy transformation program that serves as a roadmap for other small towns across the U.S. 3
4 STEP-UP Goals Improve energy efficiency by 20% in 20% of UP homes. Replicate the program (as STEP) in three neighboring communities: Hyattsville, Riverdale Park, College Heights Estates. Develop a downloadable, ready-to-use tool-kit for easy program replication by other small towns. 4
5 Why Small Towns? 80% of the US lives in 350 metro areas, within which half live in jurisdictions of 25,000 or less. The average jurisdiction in the US is only 6,200. In Maryland: Only 17 cities with populations >15, towns and villages, average population 2,174 5
6 University Park (UP) 2,500 residents, 919 homes, two churches, one school, town hall. Typical small town elements: Volunteer Council Small municipal staff Modest budget Limited energy expertise 6
7 Low-Cost Low cost social marketing using trusted, established neighborhood channels is thecomparative advantage of the small town model: Newsletter Town events Direct mailing STEP house parties Yard signs neighbors Marketing as a percentage of budget for a typical efficiency program is >30%. For STEP it is 3%. 7
8 Lower Information Barriers UP residents Civic Association, clubs, churches School and PTA UP listserve UP newsletter UP events 8
9 Lower Transaction Barriers The STEP Energy Coach Individual facilitation is key to the program MD towns or counties could work together to support a regional Coach 9
10 Lower Financial Barriers Rebates Maryland Energy Administration DHCD Pepco STEP-UP rebates Financing Sandy Spring Bank Maryland Clean Energy Center DHCD 10
11 Proven Impact to Date (18 Months) 25% of UP households have signed up for the program (226); 19% of UP households have had a home evaluation (171); 12% of UP homes have completed efficiency upgrades (108). 11
12 Household Impact Energy reduction Utility bill reduction 15% per year $375 per year Total invoice for all work $3,860 Rebates received $2,335 Net out of pocket costs $1,530 Simple payback period 4.1 years Simple ROI 25% Source: STEP-UP program records *Rebates from STEP-UP, Maryland Energy Administration and Pepco. Does not include potential Federal Tax Credit 12
13 Local Economic Impact Grant expenditure $300,000 Leveraged investment $400,000 Contracting firms working 39 Full-time jobs created 9 13
14 Environmental Impact Electricity 61,250 kwh Natural Gas 7,514 Therms Fuel Oil 1,427 Gallons Reduction in greenhouse gases: 100 tons Modeling sources: BEACON modeled savings from Home Performance with ENERGY STAR audits GHG calculation: 14
15 Thoughts from the Mayor A big burden for small municipal teams Takes political will: not a no brainer for Council A unifying community activity 15
16 Post-Stimulus Imperatives Deploy lowest-cost program options with proven impact Share fixed program costs with neighboring towns Act Locally, Organize Regionally Maximize leverage of the remaining utility / public funds Plow savings back into program 16
17 Next STEP 1. Deploy STEP in neighboring communities: College Heights Estates, Hyattsville, Riverdale. 2. Build the tool kit for other small towns to use. 3. Identify interested partners with whom to replicate the model across the region. 17
18 Maryland Municipal League THANK YOU! John R. Tabori, Mayor Chuck Wilson, Program Director 18
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