Report to Mayor and City Council
Tuesday, October 06, 2020
Consent
SUBJECT:
Title
CONSIDER AUTHORIZING THE CITY MANAGER TO SIGN THE ON-BILL FINANCING LOAN AGREEMENTS WITH SOUTHERN CALIFORNIA EDISON (CITY COUNCIL)
Body
I. SUMMARY
In December of 2017 and early 2018, the City replaced approximately 920 city-owned and city-maintained median street light and safety light fixtures from high pressure sodium vapor (HPSV) to energy efficient light-emitting diode (LED) fixtures.
The City purchased the fixtures directly from the lighting supplier and utilized contractors with existing contracts at that time to install the fixtures. The cost of the material and installation was approximately $420,000. The project was projected to have annual energy savings of 450,000 Kilowatt Hours (kWh) and annual cost savings of $42,000.00.
The City applied for utility incentives and zero interest financing from Southern California Edison (SCE) prior to starting the project and expected these items to be closed out shortly thereafter. However, there was a delay after the completion of the project to secure the incentive payment(s) and financing paperwork from SCE due to the complexity of application and the number of accounts involved. From 2018 to 2020, City staff and SCE continued to work together to resolve the issues. A one-time incentive payment in the amount of $49,162.12 was made to the City in April 2018 and a second incentive payment in the amount of $170,275 was made to the City in October 2019. These two incentives total $219,437.12 and they do not need to be repaid.
The City intended to utilize SCE's On-Bill Financing (OBF) zero interest loan program to help finance a portion of the project cost. The OBF paperwork could not be finalized until the incentive payment issues were resolved. The loan agreements are now ready to be executed (Exhibits No. 1 & 2). SCE created and reserved funds under two project numbers:
- SCE Project No. 364-16-0500820718 BDL0497 with a loa...
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