The Energy Fund is financed by re-investing the funds saved through energy efficiency measures into new energy saving projects. In 1988, the City utilized its municipal bonding authority to fund a $1.4 million Energy Bond project. The Energy Bond enabled the City to implement energy efficiency measures in thirty City facilities. The payments for this ten-year bond were generated through energy cost savings. With the bond paid off in 1998, the City chose not to eliminate the bond payment line item in the annual budget but rather to reduce it by 50% to $100,000. This money was then used to finance the new Municipal Energy Fund.
City Council approved the first $100,000 to be available in fiscal year 1998-99 of which $87,000 was spent in the first year to update energy audits for 21 facilities and to implement lighting improvements at 14 of the facilities. During fiscal year 1999-00 these improvements will generate $19,850 in energy savings of which $15,880 will be re-invested in the Municipal Energy Fund. This money will be transferred from the budgets of the facilities that received the energy improvements to the Energy Fund at the end of fiscal year 1999-00 and be available to finance further energy improvements in fiscal year 2000-01. The payments from these first year projects will continue into the Energy Fund for 5 years, contributing $15,880/year or a total of $79,400 back to the fund.
The $100,000 budgeted annual contribution to the Fund was discontinued after the fiscal year 2003-04. From that point forward, the Fund has relied on payments from past projects to finance new projects.
Facility budgets are not impacted by the up-front costs of the energy improvements which are covered by the Energy Fund. The annual payments are made from a portion (80%) of the resultant energy savings, allowing facility budgets to be reduced or to apply the remaining savings (20%) to further improve the facility or services.
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