Airport Energy Efficiency and Cost Reduction (2010)

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35 FACTORS THAT AID IN IMPLEMENTATION OF ENERGY EFFICIENCY PRACTICES Economics When asked to identify factors that have aided in the imple- mentation of energy efficiency projects, funding, especially that outside the regular budget, was noted as primary, espe- cially at smaller airports responding to the survey. General economic factors related to escalating operation costs also have increased support for energy efficiency projects and caused airline tenants to “aggressively support investments that reduce operating costs,” noted one airport manager. By leveraging this growing demand in support of energy efficiency projects, an airport may be able to increase the scope of a project, make the project more competitive within a state or federal grant process, and/or find broad support for improvements within the airport administration. Staff Behavior Other, less economically focused factors such as staff behav- ior and general social attitudes toward sustainability also play a role in the success of an energy efficiency project. With more focused attention on sustainability issues within the last decade and the documented impacts by airplanes on carbon emissions, energy efficiency projects have ben- efited over other capital projects owing to their greater value. Staff behavior has most certainly been affected as well, with Americans overall being more conscious of sus- tainability within their workplace. Although less quantifi- able, modifications to staff behavior could be assumed to be low cost and high value. Technology and Design A third major category of factors aiding in implementation are those associated with technology or design. As noted in the planning section, by considering energy efficiency in the design of every capital project and within operations, the need to retrofit is eliminated or reduced and payback can be fully evaluated before expenditure. With major mechanical or electrical system upgrades, evaluation of efficiency is prin- ciple to the project and, as such, generally brings low addi- tional design cost. Highlight Value A key implementation strategy noted by one major airport is to acknowledge and highlight the “multiple value streams,” including economic, environmental, and operational, that accrue with energy efficiency projects when presenting programs and improvements to airport staff and other stakeholders. Designate Energy Efficiency Advocates Unique factors that have improved energy efficiency project success at large airports, including TPA, MSP, and DFW, include special programs focused on sustainability and goal setting processes. To ensure that building systems operate as specified and designed, a commissioning framework and “energy advocate” or committee should be present in early phases of the design process (CAP 2003b, p. 9) and throughout project bidding and implementation. One interviewee noted that this strat- egy helps avoid “value-engineering” out energy saving design strategies to reduce project development costs at the expense of increased operations costs. Dedicated Energy Managers Although the management of energy systems at smaller air- ports is usually very limited (with most responsibilities falling on the airport manager), dedicating staff time to monitor- ing energy use can provide aid in implementation by col- lecting accurate data for future energy efficiency projects and ensuring that equipment is performing at optimal efficiency. A majority of airports surveyed do not dedicate full-time staffing toward energy management, even at larger facili- ties; however, energy management is often under the purview of airport staff. PROJECT JUSTIFICATION Justification for energy efficiency projects is often a challenge owing to a number of factors. Each project and airport termi- nal is unique, with variable fuel and electrical costs, climate, building size, mechanical and electrical systems, etc. These factors, coupled with limited data about energy efficiency CHAPTER SEVEN STRATEGIES FOR IMPLEMENTATION

36 project upfront costs and payback and constantly changing technology, make finding and documenting appropriate sup- porting information to justify a project challenging. Data As mentioned elsewhere in this report, data about existing energy costs and use for an airport terminal is the primary way to understand what type and where improvements will be most successful. These data are best gathered through an energy audit or commissioning process that approaches the terminal systems holistically. Larger airports participating in the sur- vey indicated that funding for commissioning or other tech- nical evaluation is often supported by utility companies, with some utilities providing consultants as well as funding. Feasibility Studies Small airports can turn to a variety of sources for feasibility studies including cost–benefit analysis and ROI analysis per- formed by airport staff, case studies of similar projects, or other technical literature from consultant and industry reports. These resources can provide support with examples of project processes, comparable technology, and documented payback, but typically require additional staff analysis and packaging to support a particular project. Demonstration Projects An alternative strategy and one that may be especially viable at airports located in areas of unique weather; that is, strong winds or excessive sun, is to fund small-scale demonstration projects (wind or solar) in support of larger, terminal-wide installations. Demonstration mock-ups such as window films and lighting systems can also be considered for interior projects as a part of retrofits or remodels. Included with Other Capital Projects Interviews identified that most energy efficiency projects are usually not stand-alone projects and therefore required less specific justification because the core project had other, non- energy benefits. In general, the chances of implementing an energy efficiency project are greater when that project is a part of an existing, funded project. FUNDING CHALLENGE As might be expected, the major challenge to implementation of energy efficiency projects at airports surveyed is funding. With no recent increases in Airport Improvement Program (AIP) funding, limited passenger facility charges owing to low enplanements, and a greater focus on security improvements, funding dollars for energy efficiency projects at smaller air- ports are limited (Schofield 2009). Local level grants by energy providers and other state orga- nizations usually support smaller projects or portions of major upgrades. These funding sources continue to become more available, especially in states with aggressive sustainability targets and legislation such as California. If adequate funding were available, survey respondents indi- cated that improvements that reduce operations costs would receive priority. Second to operations costs were additional control of systems, which may be more easily attainable for smaller airport terminals owing to their (relatively) low build- ing square footage, and simplicity of systems. Funding for energy efficiency projects at most airports sur- veyed is largely handled within the regular budget process, either through operations or capital expenditures. In many cases, for smaller airports, budget dollars are FAA/AIP fund- ing; however, the financial structure of larger airports often includes other sources. Depending on the type or duration of project, lamp retrofit or visual display retrofit for example, energy efficiency improvements may be included in normal O&M budgets for little or no cost. In addition, at the end of the fiscal year, smaller projects such as lamp or fixture retro- fits may be addressed by left over operational dollars. Grants In addition to FAA funding such as AIP entitlement grants, other governmental agencies such as the EPA, DOE, and U.S.DOT have provided grants to airports. Recently, an Energy Efficiency and Conservation Block Grant from DOE was awarded to support construction of renewable energy systems at an airport on St. Croix, U.S. Virgin Islands (DOE 2009c). Ongoing terminal improvements including a ground-source heat pump mechanical system at Juneau International Air- port were funded in part by grants through the state of Alaska Legislature (Palmer and Fritz 2008). Additional funding for the improvements came from local Capitol Improvement Plan (CIP) funds and a sales tax. WEBLINK—Financing Energy Efficiency DSIRE—Financial Incentives for Energy Efficiency: http://www.dsireusa.org/summarytables/finee.cfm. Financing Energy Efficiency Improvements: http://cepm.louisville.edu/Pubs_WPapers/ practiceguides/PG21.pdf Chapter Summary The following methods were identified within literature and survey data as ways to implement practices that reduce energy costs and improve energy efficiency at small airport terminals.

37 • Leverage the growing demand for cost savings in support of energy efficiency projects to increase the scope of a project, make the project more competitive, and find support within the airport administration. • Take advantage of changes in social attitudes that support sustainability to stress the greater value of energy effi- ciency projects toward overall airport carbon reductions. • Consider energy efficiency in the design of every capital project and within operations. • Highlight the “multiple value streams,” including eco- nomic, environmental, and operational, that accrue with energy efficiency projects when communicating to stakeholders. • Utilize commissioning to ensure that new or retrofit building systems operate as specified. • Designate an energy advocate within the project teams to monitor and support energy efficiency goals. • Utilize data from audits, feasibility studies, and demon- stration projects to justify new projects. • Consider grants from state and local utilities as well as alternative funding structures such as ESCO’s agree- ments to fund energy efficiency projects. Box 16 Financing Energy Efficiency Allison describes a variety of financing mechanisms including “internal financing, debt financing, lease and lease-purchase agreements, energy performance contracts, and utility incen- tives” (Allison 2008, p. 8). Traditional internal capital methods are “often the simplest way to pay for energy efficiency projects” because all savings are gained by the organization (Allison 2008, p. 8). Another alternative is debt financing; however, it is noted that this method can have greater administrative complexity (Allison 2008, p. 8). Other external financing relationships include “leasing and lease-purchase agreements [which] help organizations get around the high, up-front costs of new, energy-efficient equip- ment and, in some cases, include guaranteed savings clauses” (Allison 2008, p. 8). As mentioned in chapter two, ESCO performance contracts can include financing for improvements as well as “equipment purchases, and maintenance” (Allison 2008, p. 8)