Oregon City Council on Monday approved special assessments over a 15 year period to fund geothermal energy in the municipal office complex on Seaman Road that will reduce costs.
In the last few years, the city has been exploring options for increasing the energy efficiency of the municipal complex. The buildings tend to have significantly higher energy costs than similarly sized facilities because of the age of the HVAC infrastructure and the way the buildings were assembled into one complex over time, according to Administrator Mike Beazley.
The city has worked extensively with the Port Authority’s Better Buildings Program to develop a plan to increase energy efficiency and lower long-term operating costs.
“We took the first steps toward achieving these objectives in 2012 when we passed a resolution that helped establish the Toledo and Oregon Advance Energy Corporation in anticipation of this program,” said Beazley.
Oregon, Toledo and the Port Authority partnered to create an Energy Special Improvement District or Advance Energy Improvement Corporation to govern the district.
The Energy Special Improvement District allows the city, school district, or local businesses to invest in energy efficiency and cost lowering improvements while paying for those improvements over a period of years through a special assessment on their property taxes, said Beazley.
“It allows us to - instead of having a significant capital outlay - pay for energy efficiency improvements over time,” said Beazley. “That’s actually something that’s available now to all Oregon businesses as well. It’s something they can do in similar partnership with the Port Authority. There’s been dozens of businesses across the county that have it already, and there’s a couple of Oregon businesses that are already looking at it.”
The funding for the initial investment for these programs comes from the Lucas County Port Authority Bond Fund. Oregon’s obligation will be to make annual payments over the next 15 years through the property tax bill.
“We can achieve energy efficient upgrade objectives without it having to compete with out streets program or anything else. So we feel good about it from that perspective. It’s a good positive step. We’re using one of the new tools that’s available to local governments in Ohio, and Oregon was one of the first governments to help set up one of these energy special improvement districts. After the first of the year, we’ll be seeking proposals from engineering firms to design and put in a system. We’re interested in working with one of our industrial partners – Oregon Clean Energy Project – is interested in being involved in a project as well, perhaps with some grant opportunities. This saves money for the taxpayers over time. It becomes a great program for the taxpayers after 15 years when all the capital costs are gone,” said Beazley.
“Rather than creating additional debt, the expense is carried as an operating cost that is funded through energy savings and savings from capital investments no longer necessary because of the new improvements,” he said.
“After careful examination of our options, we have determined that the best long term value for our taxpayers will be the installation of a geothermal system for our complex. Modern geothermal systems can take advantage of the space we have for borings in the grassy area in the front of our complex and will eliminate any future bills for natural gas while also reducing our electric usage permanently,” said Beazley.
Geothermal energy uses a deep well boring that goes 300-600 feet into the earth.
“It’s a closed loop system, and uses the constant temperature of the ground below a certain surface to perform a heat exchange function. The constant temperature is used for both heating and cooling,” explained Beazley. “There will be no natural gas bills in the future. That will be gone. We will replace that with energy from the earth, and continue to use electricity. Much of our electric load is driven by electric demand for cooling in the summer. That low profile will be flattened out over a 12 month period and will lower our electric costs over time as well.”
Ohio State University is using geothermal energy for dorms, he noted.
The project is expected to consist of the installation of an 80 ton capacity induction beam distributed ground source heat pump system; building controls; other miscellaneous energy efficiency measures.
The estimated energy savings for the city is 62 percent. The project is estimated to cost $2.3 million.
“In addition to the geothermal system, we intend to also look at using these funds to help switch to LED lighting and for more energy efficient roofing in our complex,” said Beazley. “The average annual assessment payment for the city will be approximately $158,000, but this initiative begins paying dividends in lower costs.”