EmPower TN Selects First-Round Energy Efficiency Projects for $33.6 Million in Funding

Thanks to proactive investment in energy efficiency, the Volunteer State is one step closer to seeing significant reductions in the utility bills paid by state-operated facilities. The Tennessee Office of Customer Focused Government recently announced the selection of the first round of funding under the EmPower TN program, which will provide $33.6 million for 33 projects. The final step in the process is review of the projects by the State Building Commission.

The 33 funded projects are estimated to produce $4.42 million each year in utility bill savings, for as long as 20 years. This represents a slam-dunk investment for taxpayers. Even if you assume that the upgrades will have an average lifespan of only 15 years, taxpayers would still see a 100% return on investment – thanks to $66.3 million in utility bill savings. Projects will include high efficiency heating and cooling upgrades, lighting improvements and energy management control systems.

The largest of the 33 approved projects is a plan to upgrade lighting on the campus of University of Tennessee at Chattanooga. That project will cost over $7 million but is expected to yield $669,402 in annual savings. Other projects include upgrades at several additional universities, various state agency offices, healthcare facilities, correctional institutions, state parks, and other state owned facilities.

As we previously reported, the EmPower TN Program was established earlier this year and set a commendable goal of reducing the state’s utility operating costs by 28% over the next eight years. The state currently pays an estimated $192.5 million per year in utility costs across roughly 7,000 separate utility bill accounts.

“Utilizing energy more efficiently is a critical first step in reducing costs and improving operations,” Bob Balzar, director of EmPower TN, said. “Investments in high-efficiency technologies such as building lighting system upgrades and heating and cooling equipment lower energy use and generate cost-saving benefits for many years to come.”

Applications for the first round of funds were due in July and followed a series of workshops across Tennessee that informed stakeholders of the savings opportunities offered by the program. The Tennessee General Assembly approved $43.7 million in funding for 2015-16 to improve efficiency in state buildings, with $6.2 million of the total going toward a statewide energy management system.

“With the 33 projects recently selected to advance through the State Building Commission process, we are seeing a solid first year for the EmPower TN initiative. And we are excited to begin working with the Legislature on building on this success for an equally exciting Year 2,” said Balzar.

Although EmPower TN only funds projects at state-operated facilities, it is intended to serve as a model and training tool for local governments and to “attract the support of private and nonprofit organizations interested in promoting energy conservation, clean and renewable energy development.”

SACE applauds the hard work that has resulted in the success to-date of the EmPower TN program. We look forward to continuing to promote energy efficiency efforts and opportunities for state and local government, utilities, and private organizations.

One opportunity currently available to local government is the latest round of funding under the Clean Tennessee Energy Grants, which was announced on November 2 by the Tennessee Department of Environment and Conservation (TDEC). Pre-proposal submissions are due January 29, 2016, for projects that may include renewable energy, energy efficiency, and air quality improvements.

In addition, as stakeholders plan for the Clean Power Plan (CPP), there will be opportunities for many different entities to develop energy efficiency project proposals that could benefit from emission reduction credits or allowances. As an early action opportunity for the CPP, the Environmental Protection Agency has proposed an optional Clean Energy Incentive Program (CEIP) that would provide credit for renewable energy and extra credit for low-income energy efficiency during the two years prior to the CPP compliance period. Local governments and communities are already working on laying the groundwork to develop CEIP-eligible projects, and there is significant potential for ramping up  energy efficiency efforts across Tennessee partly in response to the CEIP.

The tide is rising for energy efficiency, as more states and utilities embrace it as a least-cost resource and the most cost-effective way to achieve compliance with the CPP. The State of Tennessee deserves to be commended for its leadership through the EmPower TN initiative, and we look forward to seeing more states across the Southeast follow its example.

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