SEPTA announces public-private partnership for energy-efficient retrofits

At its October meeting last week, SEPTA’s board approved two sustainability projects made possible by the state’s 2012 Guaranteed Energy Savings Act (GESA) enabling public-private partnerships for financing energy projects. 

SEPTA will finance an $18.2 million energy retrofit, for five facilities and railcar fleets, and a $26.8 million natural gas plant, which will power part of the Regional Rail system as well as the system’s largest bus garage.

The other facilities in line for energy efficiency upgrades include the Berridge, Courtland, Germantown, and Fern Rock Shops, and the Southern Bus Garage. The work, which begins this fall, includes everything from LED lighting replacements to building insulation, HVAC controls to water conservation. 

Despite the $18.2 million pricetag for these projects, they’re intended to be budget-neutral because they’re financed by the $26 million in future cost savings from projected efficiency improvements over the next 17 years. If all goes as planned, there will be $7.8 million in net savings for SEPTA’s operating budget.

The way the GESA financing works is that a private “certified energy savings company” (ESCO) – Constellation NewEnergy, in this case –  designs, builds, and installs upgrades, and they are responsible for providing private capital and an energy savings guarantee. If for some reason those savings don’t materialize, the company is on the hook for the loss, instead of the taxpayers. 

SEPTA also selected Noresco, LLC as the ESCO to design and build a $26.8 million Combined Heat & Energy (CHP) plant at the Midvale Complex in Nicetown. The plant would power the Wayne Junction Substation and the Midvale Bus Garage (SEPTA’s largest garage, housing over 300 buses) using twin natural gas generators.

The next step is for Noresco to conduct an investment grade audit to determine the optimal size and configuration of the plant. The CHP plant needs to provide sufficient base load power, and then assign peak loads to the commercial power system. Excess heat from the plant will supply heating load to three other nearby SEPTA facilities. SEPTA officials pointed out that this CHP plant would provide the system with a resilient power source in case of an outage in the regional electrical grid, allowing trains to operate even during a blackout.

If the audit determines the plant could be self-funded under the GESA, officials say it could be built and operational by 2017.

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