Washington DC Housing Authority Project
The Washington D.C. Housing Authority has over 28,000 residents in 5,444 units across 31 properties with more than 10,000 utility accounts. With over $20 million in annual energy expenditures and the need to modernize millions of dollars of equipment, the Authority was seeking creative approaches to maximize the energy efficiency programs offered by HUD.
DCHA evaluated several options including the traditional approach of using an ESCO to accomplish their goals. They determined that due to the extensive need of physical repairs and limited budget resources, they needed to maximize every dollar in order to make significant progress.
Data-driven Energy Capital Improvement Program (ECIP) Maximizes DHCA's Resources
After an extensive selection process, DCHA determined that ThinkBox Group’s unique “data driven” approach, the Energy Capital Improvement Program – ECIP – provided the most efficient use of resources to address their modernization challenges. ThinkBox provided the authority with the ability to focus on things they already did well such as purchasing, engineering and construction management, while ThinkBox brought the complex program development and financial engineering services. DCHA utilized ThinkBox to develop a master plan for energy and environmental operations that the Board of Trustees adopted and integrated into the overall Master Plan in 2000. That plan still guides the efforts of DCHA today.
Since 1997, DCHA and ThinkBox have teamed to identify the necessary requirements to successfully implement a self-directed, performance-based program. First it was necessary for the Authority to establish an accurate utility consumption and cost baseline. This task was made difficult by an existing centralized energy center managed by the District of Columbia. Paul Orentas, ThinkBox principal responsible for the project recalls, “DCHA did not even have previous bills on file from which to establish a consumption baseline. The District-wide system was obsolete and did not allow the Authority to understand fully its costs and usage.”
In response to this challenge, ThinkBox designed a decentralized, user-friendly utility billing and administration system to process and verify all bills in-house and report monthly costs and consumption for over 10,000 electric, gas and water accounts. The result was the most comprehensive utility baseline in HUD history. In addition, the team recovered over $1 million in historical erroneous billings the first year. ThinkBox also supported the Authority in taking advantage of recently enacted energy deregulation legislation to purchase natural gas and most recently electricity, resulting in additional savings of over $1 million from securing the most competitive pricing.
Next, ThinkBox conducted a comprehensive energy and operations audit and identified equipment replacement needs, energy and water savings measures and employee training requirements for all 31 properties. Armed with a comprehensive baseline, clear energy and water saving measures, and having already experienced cost savings from billing errors and competitive gas purchases, DCHA was prepared to make its case to HUD for a self-directed program implemented by the in-house team.
The Authority turned to ThinkBox to prepare and present all program related documents that included a project management plan, financial modeling, a procurement and acquisition plan, a commissioning plan, and the key program element - a comprehensive measurement and verification protocol.
“Once the DCHA’s Board of Trustees determined that the projections and planning were sound, they adopted the plan and voted to seek HUD approval, and to finance the program”, says Daron Coates, a principal at ThinkBox who established the initial relationship with the authority.
Since this was the largest self-performing energy project undertaken by a Public Housing Authority, the HUD evaluation process was very thorough and took almost two years to complete. DCHA selected a 12-year fixed payment approach that guaranteed its loan payments would be provided by HUD. HUD provided its stamp of approval and financing was arranged. A lender was selected and funds placed into DCHA’s account in the fourth quarter of 2007.
ThinkBox will support the DCHA during the three-year implementation phase in project management and commissioning. In addition, ThinkBox established a comprehensive measurement and verification protocol, which was instrumental in persuading both DCHA’s Board and HUD to implement the program. ThinkBox continues to utilize this protocol to evaluate and report savings results today and throughout the 15-year life of the program. The measurement and verification component was important to gaining approval and financing for the program and will be critical to demonstrating the success of this initiative.
ThinkBox Group was successful in performing key complex services that facilitated the implementation of a project that will assist over 28,000 residents of the District of Columbia Housing Authority to enjoy a safe, comfortable, efficient and environmentally sustainable living space. DCHA is happy that their limited resources will go as far as they can to support the people they serve.