ating we have the opportunity night to hear from organizations they've brought a new approach to us we work made aware of whenever the architects are here on a program called act thirty nine and  opportunities that were here in the district we actually came you may recognize as we were here what it was like two and a half weeks ago for the presentation from premier and then the architect and we sat through a lot of that was a lot of good information but we we were invited as just just to come and watch it presented what i want to do tonight is present to you something that the state has a program that the state has that could give you an alternate way to fund some of those improvements ok but i want to thank everyone for their time tonight if you look at this slide deck there are quite a few slides it's not my goal i'm not going through all the slides by any means i'm just going to touch on the major points  my goal is to educate you guys on act thirty nine what that legislation is in a state of pennsylvania my company information is in there constellation energy where a national energy service company with the leading provider of energy in the marketplace today but that's all really going to say we've done all these projects over the past couple years you could read up on them but the goal again is to talk about act thirty nine and how it could be a benefit to peter township schools ok and as we go through this if you guys have any questions they want to hear but please ask them as we go along i don't have to go through all this information i'm just going to touch on the major points ok vince if i can ask  much time do you want to give us tonight because i could condenses this as much as you guys like ok one point before we get into that the information that was presented to you guys in the past two weeks ago from premier and from the architect that's good information i mean you know that there's energy projects improvements that need to be made at the schools if we could just put that aside for the beginning of this presentation and we can get back into some of those areas that are are going to be needed for improvements in the schools the goal again is to talk about how x thirty nine could be a funding mechanism for the if you can go to the second slide if all your schools were brand new i wouldn't be here as an asco an energy services company trying to talk to you about act thirty nine but you guys know that your schools are older and in need of some improvement ron's been doing a good job with the facilities here we met with him week and a half ago talked about what's already in the schools he's done a good job with what he has this legislation  give you an opportunity to do a lot of improvements all at once and utilize the savings as the funding tool in the next line the the actual legislation in pennsylvania is called p a act thirty nine all it really is it's it's a god line it's basically legislation that allows public entities including school districts to enter and to long term performance contracts without having to use capital money ok if you boil everything down it's really a financing mechanism so for the fans says the business manager i mean this is a way that instead of using capital dollars  bond money you could basically utilize energy savings that are going to be real savings for the district utilize those savings to pay for the improvements over a period of time we're talking long term are we talking fifteen years yes the actual legislation allows public entities to go out twenty years here but most of the projects that we've done have been fifteen years and like it's really your choice how long you want to go out the longer you go out the more energy projects you could potentially include ok one point i do want to make under this legislation there's not a pool of money in the state the state of p a does not have pull money that they'll give to districts to do these types of projects rather the legislation is the guidelines it's basically how it allows public entities to enter into these types of contracts financing still needs to take place but instead if you're saying capital dollars will get into how the energy savings that guaranteed energy savings that the esko would bring to the table is used to pay for those improvements over that period of time if that makes sense  you can go on to the next one we basically this is a term that's used which you guys may have heard of in the past is called performance contracting that's what this really is the legislation is the guidelines it's basically the rules on how state entities can enter into performance contracts to do these types of projects and you do have to competitively bid the services of an escrow that's what that's what we are to do these types of projects the savings are guaranteed so the the studies that you guys heard from premier talking about the kilowatt reduction the m c f or duck session and even gallon reduction on the water side all of those reductions would be guaranteed by the esko and then translated into dollars so you guys know exactly how much funds you have to pay for that debt service over that period of time you can go to the next line escrow again you may hear that term a lot if you guys entertain this process and escrow is nothing more than an energy services company it's a company that comes in and looks at your total utility span looks at what type of systems you guys have in your buildings and then we look at ways to make those buildings more energy energy efficient the key is quantifying those energy savings so they could be used to pay for the improvements over the period of time ok the esko brings about the upfront engineering and these types of projects so built by my engineer he would be one of our our main guys on site doing the audits of the building that figure out exactly what type of savings there are when we get into construction we basically become the general contractor so we manage the entire construction process and then at the end of the project we have we put together a measurement and verification plan so we can prove out the savings to the district so you know that what we put in our report on the savings amount is going to show up for the district so they can use that to pay these off ok you can go to the next one energy this kind of small but you guys have it in your package there when you think about energy efficiency technologies a lot of the things that were described from premier and even the architects when they were talking about mcmurray elementary and some of the things they're anything and everything energy related can be looked at within an energy project and that thirty nine project so water conservation lighting upgrades and including occupancy sensors like you were talking about ron in the last meeting those can be included boilers chillers control systems rooftop units windows you name it anything energy related can be looked at under this program there so when you think about one when we met with vents and ron we're talking about how this gets funded if you look at what you guys spend on a yearly basis that's in your budget ok i believe you guys are spending a little over a million right now as a fence is that correct yeah a little over a million i kept were round numbers here so if you look at the left side of this equation that's before you do an energy project so your existing conditions and this may not be the exact breakdown of how it is it's just rough estimates at this point but you're spending a million dollars he got your like tricity you got your gas you got your water sewage every year that amount is budgeted and you probably like most districts want to crease that a little bit just because of inflation and rates going up you might put like a three percent add iran each year to fund paying for the utilities ok you haven't you have an operation and maintenance budget to ron's budget to maintain all the different systems that are in the schools so you have that on your bike that every year going forward ok if you go to the right side of the equation the post esko conditions if you do an energy project utilizing act thirty nine a good rule of thumb and again we didn't do it for we didn't do an audit of your facilities we were able to read through what premier put forth and we were able to sit through the architect's study for the one elementary but a good rule of thumb that we use in the industry is roughly about a twenty percent savings ok when we actually get in and do the audit that savings could vary from fifteen to as much as forty depending on what systems you guys have you guys have and your schools here so for this example i use twenty percent  twenty percent of a million if you see that up in the red twenty percent of a million is two hundred thousand ok if that's the amount of savings that we are able to generate that's going to be kilowatt reduction k w h reduction m c f reduction gallons of water adduction all translated into dollars so if two hundred thousand dollars are the savings if you multiply that by say it's a fifteen year term that you guys choose to go out and again you can go up twenty but for this equation if you go out fifteen years fifteen years times two hundred thousand that means there's a pool of three million dollars that you guys can do energy projects without having to come up with any capital money one point to make up here for you look at the left side of the equation you guys are spending a million dollars if you look at the right side of the equation you guys are spending a million dollars so a lot of time high get the question so we're the savings the savings are it's a very good question the savings are real that two hundred thousand dollars is going to be used to pay for the improvements over a period of time the big savings that a district or a city municipality that we work with the big savings and their capital budget and stead of using capital draw if you have capital dollars allotted instead of using capital dollars to pay for that behind the scenes stuff the lighting the boilers you're able to preserve that capital fun for more brick and mortar type improvements now mcmurry elementary you may need that for some brick and mortar and some flooring and different things like that but that's the big save that the energy savings are real whatever that number is up there that two hundred thousand that's going to be a real number but again going back to what your capital budget is how much you have and there are a lot it it can be used for other things get a dollar amount but basically it's quantity it's k w h what you're using at the building times your rates six and a half cents whatever that rate may be eight times your usage the hours of operation at the building so if we come in and we change out all the lighting and reduce the wattage week and by the way your light levels will be better but reduce the waters with the new we put in a new trailer we put in new control system s better control the buildings after hours and on weekends that unit offender g reduction is going to be reduced to bill's point if the rate goes up we can't control the rate we can only control the usage of the equipment that we put in so the unit of energy is going to be reduced but if the rate goes up your bill may actually go up a little bit but the unit didn't go up as high as it should have because all of the equipment that we put in would be working with the yes and no i mean some of it is some of the equipment doesn't i mean their useful life for some of the equipment is only fifteen years but it's really a choice we did a project with the city of greensburg they went out twenty years we did a project with east allegheny schools they went out fifteen years we're quoting one right now for new brighton area school district they only want to go up fifteen years so it's really the choice of the entity at the end to the day how far they want to go up and yet that  one of the reasons why shorter term ok so you can go to the next line this one's pretty much the same as it's a visual up there before and after i mean you have a money that you have in your utility budget if you basically do these improvements the green is the savings coming out of that same poll so you really are the budgeting the same amount of money but the savings are being used to pay for the improvements over a period of  next line some of the measures we call and this industry we call the measures e c m say energy conservation measures but some of the measures that could be included are lighting  pumps voting controls things like that they're repaid dollars that were spoken of two weeks ago from premier the audits that we would do of the lighting basically that would be the paperwork that's needed for the rebates to be you have to you do have to get pre qualified so we would the escrow would prequalify send that paperwork in for you and whatever that money is how much that is gets turned over directly to the to the school district and if there's any other rebates to for anything else electrical that could be reduced within the schools that could be submitted also so the rebate money not the confusion of the rebate money is act one twenty nine that's out there you're in the second phase is the gentleman from premier was talking about it so there is still some money out there to be had on the rebates  nine which is just the funding mechanism that the state has you can go next line i include this slide this is basically just what you guys have been doing again the the dollar amount you guys are spending a million dollars on utilities right now if we take that twenty percent ok a lot of people say well can i keep doing what i'm doing right now yes you can keep doing it and spend that million dollars and have the inefficient systems or you can reduce redirect that wasted dollars that on the older systems and spend that on an energy project to get everything upgraded all it wants so it's really status quo or go i mean  decision of the board to see if this will be basically a mechanism or an option to get a lot of these projects done all at once a couple slides here at who we are you could read through that that wasn't my goal to go through explain who constellation is if you have questions i could borrow means answer them you can go to the next one to answer your question yes constellation is a large company were fortune i think were fortune one hundred now we're part of the excellent family but we do three utilities we own no yes now in this market if you go to the next page that map of penn the map of the united states in the deregulated market we have a division of constellation that sells power and gas so right now your utility and i think you guys already are buying your electricity from a secondary supplier is that right then yes so confident we're in yeah ok yes so you're buying it through there when that contract comes up i mean not not that's part of our sort of my side of constellation but we have guys in iraq has who can take give you a thirty second set of eyes on that rate and just see if it makes sense to stay with who you are now or have us give you another price we try to look at not just your energy efficiency when we come in we want to look at your entire energy strategy and see if there's any way we can help save you and other parts of the bill so you do not have to go with constellation those utilities are separate entities within arm's broa but again we can price up your commodity just like a first energy would or anybody else would within the market just to see if we're low priced will tell you that if we're not stay with who you are that that does not have to be part of this at all it's just something we bring to the table also ok you can go to the next one this just talking about some of the projects we've done you can go to the next line we have a whole we've been doing this for i've been doing it for twenty years here and western pennsylvania with some different companies button and western p a market constellation we have a lot of good references some of the ones some of the most recent ones up there are elizabeth forward indiana area schools and east allegheny are probably the are three most recent projects central cambria corey apollo ridge and all those projects we have measurement verification reports for that show the savings we have to go back every year to prove out that savings are there so we do annual reports to review utilities and check the systems and everything so we do have histories on all of those projects showing where our savings are coming in the fast forwarding ok x thirty nine basically it's a three step process if you guys if the board was interested and looking at this is an option to pay for these improvements the first step of the process the upper block is basically preliminary is there are projects ok i mean from an outsider looking in when bil sat through the premier study there is a project here i mean you guys know that there's old lighting there's t twelve that i think one of the schools and then there's older generation t ates at the other four so a lot of that can be upgraded control systems as ron mentioned to us or older i mean there's things that could be done so if you guys know that there is a project that's basically the preliminary face the next step in the process would be procurement you do have to go into the r p or the r f q process to select somebody but basically you do have to competitively select the asco once you select the asco the company and when you put this out for big you might get five you might get eight you might get three i mean it varies new right now the last one had three indiana had thirteen so it varies some we compete against a lot of the other companies that are in the market once you select the nasco and not to believe in sas or even think ron asked this question we are sitting down when is the first time that the district could be have some financial implication to the it's that last phase down there the bottom part works as contract once you would select an escrow you basically enter into an investment grade audit agreement with that company that investment grade audit there could be a f to do the audits ok now that c is not pay a poll unless we do the audit and that audit takes ninety to one hundred twenty days when you say don't three to four months to do the full audit of the buildings that that payment would not be due if we do the full water come back with our findings which would be detail every light bulb counted every room visit every system every utility bill analyze we come back with our audit in a different piece cm's and you guys say now thinks we don't want to do anything well then we would invoice you for that whatever that i'm on is if you move forward in the construction then that fee gets rolled into the overall price of the project and it's never pay your bill as it is to give you an idea of a fee indiana area school district we looked at seven buildings our fee was i believe thirty thousand dollars we spent about one hundred on the audits but we don't where is it an engineering company architect they make their money on the audit we don't make any money goes aren't set up to make money just on the audits we make our money when we implement the project so really that fee is just a placeholder just in case something would go wrong for new brighton our police i believe our fee was twenty thousand for new brighton school and we're presenting the investment grade audit to that right now as we our good question when we present the investment grade audit it will be a whole listing of e c m spro building like the high school the middle school and so on you guys can pick and choose which measures make the most sense you could eliminate some if there are too long to pay back but some things that could come up maybe one if you look down on the bottom financing is set up that's one of the things say the market goes crazy when we're ready to present this investment grade on it to you and you were thinking you were going to get a four and a half percent interest rate so if something happens and the rates go up to six and a half or seven well maybe the cash flow doesn't work as well so maybe you to lay it until the market comes back down so there's a couple things or if somebody say say there's some grants or something that come down and you guys get capital money to do it maybe you don't want to do the full performance contract then so there's different options that could come up or different things that could come up to cause this to be scaled down a little or i guess postponed it would be through a local bank somebody that you guys are using right now or a national lending institution we can assist with putting out in our pay peters township school district or constellation energy on behalf of peter's township putting out this energy performance contract worth x amount of dollars with so much savings to be funded over fifteen years what's your best fixed rate and we would go and get rates and just present them back to the school and you guys would decide what the what the most beneficial is for you the one the one thing good question on the process that investment grade audit process that ninety to one hundred twenty days it's not like you guys are going to see us at the beginning and not see us till the end we typically do would do board updates as often as you guys want if you have building grants committee meeting once a month or however we can give an update so you know exactly what we're looking at and before we go out on site we would sit down with iran with even with this committee and say ok our engineers bill knows what to look at for energy efficiencies but you guys know the buildings better than we do w ask for your input where do you what do you want us to look at and we'll see if it makes sense to go and so we'll get your direction you could be as involved or on involved throughout this process we like it better when you're involved because what i mean you're input is more valuable than anything because you're there but we'll give you updates all throughout that process so you know when we come back with that i say which might be a big binder you'll know exactly what's in there it won't be a tax exempt municipal lease or a general obligation note which is very similar to a bond they opted to go with the general obligation no so the funding how you guys what type of debt is set up  it does not matter to the escrow whatever it's the most cost effective i mean if you have bought if you have an existing bond or you're going out for one and you can increase that amount to include this if the cost of money less than the tax exempt lease that's fine we don't have any preference i mean that's something that we do completely separate them the guaranteed energy savings contract so whatever makes the most sense for the district we would about was that you want to make sure no matter who comes in here that you had the opportunity to oversee and talk to the manager on a daily basis because you'd like to be able to have that opportunity that be very good point when we go to be able yet we're when we run brought that up in our meeting when we go what when we would go out say we get a scope of a lighting retrofit or boiler replacement whatever it may be we will go out to local contractors and get pricing guys that you've got have worked with who have done work within the district as long as they are approved by our company i mean we make sure that everybody is covered so there's a bonding process insurance safety all of that but as long as they get improved we could use local contractors guys that you already have experience with we always start with the local area first and go out to the county then go out to the region so for doing a project in peter's township it's local  agreement with constellation with our company that basically goes through all of the equations that bill would put in to figure out what the savings are and how many kilowatt hours are reduced how many m c f how many gallons the guarantees are listed right in there the finance agreement is set up separately it's linked to the gays but it's set up separately and the cash flow basically matches the savings that are in there but say after the first year we come in we do our analysis and all of the you have the same fixture throughout all of your schools and this fixture responds to take just say forty two watts with the new f twenty eight eight lamp we hook up a meter to them and they're taking forty eight watts ok so if you think of when we think about our ways and how we how guarantee the savings we told you was going to be forty two watts all of our calculations were based on forty two now they're taking forty eight we would have to do the math and figure out exactly what we owe you guys to make you whole on that savings we also have an option well make you hold on that but then we could come and we'll go to the manufacturer for using sylvania lamps and  your system should take forty two watts so we can go when working with the manufacturer to get those fixtures down so that forty two watts if that was the amount that we're going to tell you they were working with but the guarantee is actually in dollars if we don't meet that reduction in units the sco is responsible to make a payment to the district to make them whole for the payments that are made to pay off the finance cash flow we actually our savings yes and we have we have a very good track record we have i believe there's one project where we and all the years we've been doing this that we have the payout was in a local project really your mind very good question that comes that comes into effect a lot of times the asco industry makes their money when they implement the project ok i know that's vague i'll get more specific if you think about the measures that we're going to implement ok we're going to have a lighting retrofit ok so we're going to have a lot material cost and labor cost we're going to put in new boilers we're going to put in new rooftop units or whatever for every measure that we implement we're going to have a labor component and a material component we make our monies or percentage on top of those hard costs ok typically constellation i can't speak for initial years down the road why do you care about us well the measurement of verification there's actually a yearly fee to do the measurement verification services ok but we want to use i mean we do get we'll get paid just like a general contractor would be paid so if it's a nine month construction period we would bill a i a payments typically percent complete you guys would approve it send it to the bank or lending institution the escrow agent and they would pay  then we would pay the sobs so you're correct we would get paid as the project is complete as that project keeps going we want to use it causes a reference to get more projects so we don't want to we want to make sure when we put our savings out there i mean we're very conservative we hit our numbers because we don't want to overstate saving some escrows will throw everything at the side of the wall and see what sticks we're not like that i mean we're very conservative in our d n a we want to make sure that we hit our savings so what's in it for us is that reference and that measurement verification the school district could opt in for all fifteen years get fifteen years of reports or if you're that most guys will say if we're comfortable after three four five years why keep spending ten thousand or whatever that amount is to do that measurement verification save that money and use it for more operations stuff that you guys can be doing on an everyday basis you can even use it for retro commissioning for going back again and just checking that the systems are working like they should be after your three year four y yes you could opt in whenever whatever year you'd like i mean even if you would if you would stop the amounts and year five say you want five years of it but then in year seven or eight you get after the projects complete we don't just come in and hand the books over to ron and say it's over they'll be a when emmanuel's operation and maintenance manuals and i'll be training for all your people so you know about the lamps that are being put in the systems how to operate em the control systems so we'll have all those specs in there so you can operate the buildings for the fifteen years so we'll come back again and we'll make sure that you guys are operating the buildings and again you could change something within the building we're not going to say you have to keep your building get seventy two or whatever you can operate on weekends if you change the way you operate i mean they're your schools we just have to adjust how that looks how the baseline would look because you're changing something within the schools but you didn't yeah i know of some that have come back and asked for him after that and some of the city work we did done in west virginia very similar legislation but they opted in for to come in v a and we had one entity come back and say let's do it year five because they've seen their bills go up it's because their rates are going up down there with that's mon power part of west penn power but the rates start going up so get out check on that and i'll get back to vents and  project for the most recent projects was about ten thousand dollars fur i believe for a stalley gain i think it's i think it's eleven thousand for them i think for indiana area schools were doing for more complicated measures i think it's fifteen thousand dollars a year but that's basically the cost for our measurement verification people to come in and by the way you would get a post construction report too so when things are completed instead of waiting for that first year you get something right after construction is completed the verify what we put in i doing what we say it's going to do but yeah it's based on the time and the expense of our companies people the measurement verification team to come in and basically test things look at bills analyze them and put the report together we show you that up front too by the way how much that would be but it's usually five to fifteen thousand a year  the guarantee is definitely part of it yes that the guarantee of savings the ability to the other thing this legislation gives you is the ability to do it entire project all it wants so you guys have done capital projects in the past facilities have to they have the may you have to put out an r pay hire somebody and you guys have to basically keep track of that project as it goes along you guys are responsible for when you do an energy project like this on direct thirty nine the  ko is the general contractor so we may have six seven disciplines underneath us those guys all work for us so we have construction meetings those guys maybe at the meetings but ron would have one point of contact a full time consolation employee who would be onsite who would manage those contractors from beginning to end so the guarantee is definitely a big part of it because you're going to know that that savings are there but the other piece the engineering of the savings up front the general construction when you get into it that somebody else is managing all this i don't even bring not to go off on a tangent but capital projects there's usually a lot of cost overruns typically and change orders under this project the amount we give you is a guaranteed maximum price if we miss if we miss something within the school as we're doing our audit but when we're doing our construction that's on us unless the scope changes and you guys add something new into it if it's part of an existing scope and we missed it it's on us so they're now projects you've done i don't know if we have exact numbers for that but what i mean out where honestly if if a district or a city municipality if they had the capital money to do these projects on your own you would be doing it less than going through the think if you had the money to do all the lighting all once and you could put out the bed and hire the subcontractors order the project have ron and his team manager it would be less than going through the escrow the esko makes money if you think about it the labor in the material for each measure we make a percentage on top of that but we bring the legislation guidelines that you can get all the stuff done at once without having to use capital money so there's kind of a trade off the one stop shop you're assured once you select an esko that escrow is going to sit on the same side of the table as you guys and basically try to put forth a project that's going to be benefit you guys the most and i know i'm still on this side of table now but eventually if that happens yet when we have the meetings the construction me or the investment grade audit meetings it's basically we're saying tell us about your schools before you go out there to audit them what do you guys have so we learn about them before we go out there and bill might see something he'll come back or say wrong what about this issue is one of the elementary you want to look at that so it's very very much to a team oriented approach when you get you it does cost a district more because of that the the margin that we add on to the material labor costs for each measure but again it all has to be paid for by the savings are include him in the discussions but the work that typically is done in these torts types of projects the retrofitting of equipment they're renovating it's not it's not major construction i mean if we are putting in boilers and and different  will get stamped drawings but for the most part it's basically renovation type retrofit work of what you guys already have here the window work possibly could because it would involve new windows with higher efficiency windows and new insulation and new weather stripping around there so the windows potentially could  possibly i mean those types of things depending on when once the esko is selected the school district the entity could be very creative and how this project comes together so if brick and mortar type improvements are needed if there's enough savings to justify it it can be included i mean we've done it indiana area schools we put roofs on three of their buildings  roofs there's an energy savings component we basically doubled the insulation but it was a long payback i mean it was like a forty year payback they needed the roofs so they included it in our project with some capital money that theirs was a little bit different th energy savings operational savings and they put some capital and to it to include the roof so that could be the case for some of the brick and mortars type stuff that you guys have at the one school but that would be something that would be addressed they actually did bonds up there through who was it through p f m a they did the them want issue for them but they did two separate bonds one in two thousand and twelve and one at the beginning of two thousand and thirteen so it was a three phase project that we did to the faces were funded from the first bond and the second was funded from the thirteen bond but we had a nine month can well we had an eleven month construction and we actually just completed that in november so there were no major issues with length of time one point though on this process the the investment grade audit once i mean if you start thinking it's fact beginning of february groundhog's day just passed once you get to the investment grade audit that's basically a four month process three to four months so if you start thinking you do the r p phase in a month or two some are construction some are fourteen probably not i mean unless we fast track something to do a part of it first it's probably going to be into fall at best case scenario there could be some items if they needed to be fast tracked upfront but a lot of times this is a six seven month process before with everything involved for it i do ask that we move on with the weather constraints we have all signed thank you for your time and a lot of good if you think of any other questions feel free guys next speaker tonight is patrick regan from the official another esko corporation which i'm sure a question for him to good evening thank you very much appreciate the opportunity to come in and present to this evening i also have with me david robb who's vice president business development at a little bit of a disadvantage here this evening because joe has done an excellent job of explaining the program so i hope the information that i'm going to provide to  will some cases fill in some blanks maybe touch on some other areas you're ready to embark on a complex potentially a complex decision decision to move forward with a guaranteed energy savings projects so i hope that  what i'm going to tell you here can can kind of fill in some of the blanks ph guaranteed energy savings act and joe joe touched upon some of these items you know really it's a procurement vehicle for leveraging energy and operational savings to obtain facility upgrades i mean that's what kind of guaranteed scheme with the legislation the district certainly will receive guarantee a guaranteed outcome and what that means is under the legislation you know the utility savings are actually legally guaranteed and they must support the debt service of the project on an annual basis including the cost of financing so it's really an excellent tool it's a risk mitigation tool for the  district and provides you know many benefits you know you were talking about the energy saving shortfall what happens if you get a projection on energy savings and lo and behold they don't materialize well certainly this piece of legislation what it does is it requires an energy services company to either correct the issue to make sure that the energy savings that was represented doesn't fact materialize or we have to write you a check so there's really two ways of approaching that and that's dealt with in the guaranteed energy savings contract that you would enter into with with a company well it's slightly them by the way the efficiency network ten we offer similar services as constellation does we don't offer exactly the same services but we kind of look and feel and do some things that they do we do some things a little bit different but this this per this process is really a professional services proof procurement and what that means is it's a design build turn key implementation and it's not the traditional method of you know design bit build so in the esko scenario you're going to get a guaranteed maximum price project without any change orders the traditional method you know it's a little bit different in that you know there may or may not be some change yours or orders associated with it the esko guarantee energy savings model at least in my personal opinion can be a much more streamlined process  it can be very beneficial to district you know in terms of getting the services once you put there are fewer an r f p out on the street what you're really asking for from these companies who are going to submit is what are your qualifications to be able to implement these projects and certainly what your experience in doing that and at the end of it all you know when you're sitting there making your decision the district really is given an opportunity to  select a company based on the best value that that company is going to be able to deliver to the district so it's really you know it's kind of a low bid inspect type procurement versus the best file you scenario which we think is very meaningful next slide please thank you in terms of selection you know there's going to be a procurement you're going to have companies come in coming in here to deliver qualifications packages to you they're going to you know maybe come in for an oral interview there's going to be requirements in the document that they specify what they do how they do it how they identify energy savings and so forth so some of the selection criteria that we think might be important would be to select you know a local company that has kind of technical staff that has all these areas of expertise you know the glue to bring together all these projects and deliver them to the district and that would include certainly professional engineering and internal design capabilities construction project management project finance experts on staff so that they can have the conversation with you about you know financing and looking at the cash flows matching the energy savings up against that debt service and really helping you in that regard also we thought at least you know i think it's important you have a local team that has a history of implementing these projects here you know in pennsylvania or here in western pennsylvania a very important component i think of your selection should be transparency related to the cost structure of that company and how they deliver a project here to the district you know in my opinion you should pay a very particular attention to you know we were talking about you know you know what do you get paid how do you make your money well again it's hard cost material and labor costs that subcontractors it's really their fee and then on top of that the ask goes the energy services company we offer these services as a mark up on those hard costs so you want to pay very particular attention to what are those markups on top of the hard cost to deliver this service to the district and then in the end you know you're you're going to obtain energy saving certainly looking on your website understand that you've had some  practice projections have been made on energy savings there is significant energy savings that exist here in the district so then the next question becomes well ok we have this energy savings but how much scope we're going to get for the energy savings that we actually know exists here in the district so that at least in my opinion again would be part of the selection criteria how much scope we're going to get for the savings and i only have i think about four more slides left so just to give you an idea i'll  to get these very quick through these as quickly as possible one option that i think the district should certainly consider is the if is a phased in flexible  approach to doing an energy efficiency project and what this option would include really is to capture the high impact projects first and kind of a phase one scenario and what this really gives the district is kind of a small borrowing versus you know a large borrowing i think the number up there was you know there may be a three million dollar opportunity in front of the district but let's say that the district may have a perspective of why don't we package up a couple of these projects right now and a five to seven year window to get those high impact quick payback projects right now and get immediate savings right now in phase one and by the way i think you can do that in the summer schedule of two thousand two thousand and fourteen and you know that this also would give the district the opportunity to avoid a heart commitment on a fifteen or twenty year term financing term and at the same time you know you're going to be deliver the immediate savings and you're still going to be able to maintain the option to expand your project later if you desire and the way you do this is to manage your project against a master cash flow again making sure you're meeting the requirements of the of the state legislation which is to make sure that the energy savings on the annual basis meets the debt service requirements and then of course you know to the extent that you want to look at some capital projects in phase two and you're comfortable with the results that you've received in phase one with a smaller package to a set of projects you know you certainly could do that your option phase two would not be a would not necessarily need to be a whole new procurement procedure what you would do it would be linked to the first but again it gives you all the flexibility in the world to either move forward with projects that you have been discussing with the energy company or after you get the initial projects packaged up and for whatever reason you're not satisfied then you just decide to not work with that company anymore  a couple items that i wanted to touch upon act one twenty nine the tila the rebate program from west penn power its first energy program you know as joe correctly pointed out these rebate dollars or available to the district should not be left on the table they would be included in the overall package and that specific dollar amount would be used as a direct tie by down on the total project cost  you also have the opportunity to tension it to look for some available grants at least at this time in my from what i'm seeing here in western pennsylvania across the state reach recently there's not a whole lot of specific grant opportunity out there for districts so at the time you would move forward you would want to make sure that you at least take a look see if there's any additional monies that you don't want to leave on the table energy thank you thank you so the sustainability impacts that would be kind of your carbon footprint reduction you know you're you're kind of void in subsea go to maybe you wan through your efforts and the energy savings that you're able to obtain how many you know rail rail cars of coal or avoided by you being able to reduce your consumption of electricity and natural gas so you want to kind of maybe pay attention to that as well as you're moving myself potentially against you know other districts locally and nationally nationally as to the progress i was making so it's kind of a tool to be able to utilize to baseline yourself against tell you a little bit about our company you know we were in escrow we do a number of other things but we know we guarantee energy savings and cash flows through energy and water fish and sea projects we have an extremely experienced  staff a specialist on board in our office including a number of people that have worked in the energy efficiency business for many many decades we're headquartered here in pittsburgh we're located on the north shore we have twenty six people specifically dedicated to energy efficiency projects we think we bring really kind of industry leading return on investment for these energy efficiency projects specifically we can do that and k through twelve we also have kind of a technology platform that our customers utilize to kind of inventory their buildings and control the phasing of projects that really goes kind of lines up with the flexibility i was talking to you about and this dashboard it's really get it's just a tool to allow you to be able to understand your projects you know for example in a phase two to have those have all the information in front of you for you to be able to make informed decisions and two more slides here this is just a picture of the dashboard and by no means i'm not here to to sell you a dashboard this is just a tool that's proprietary to us that you know that kind of allows you to have this information at your fingertips to be able to understand the financial justification and criteria for any given project that you'd like to move forward with again we have talking about this facility  impact metrics so that would come along with this one example of where we're using this dashboard and presenting kind of sequenced in projects is a penn state university we were recently selected by penn state as one of two exclusive energy efficiency providers they entered into a five year contract with us and another company to scope out their buildings and implement energy efficiency projects and joe was talking about you know if you put out procurement there might be you know maybe three or five or eight companies that come to the table in the in this case there were twenty two energy services companies that that showed up and it was great for us that we were selected so grow if you go through the process it's really you know people hours and pooling together you know putting the document out on the street putting a committee together to review their responses but this process does not require you to come out of pocket with any funds whatsoever to be able to eventually get a company that you can sit down and work with so there should there should not be there will not be any additional fees that are not included in in the services that are offered by the companies that are included in in total cost of financing i hope that answers your question let me let me clarify that certainly if you are going to need me your solicitor probably is under a retainer and may review these things at no cost or at least the cost including the fee pay him or her you might also  those fees or or avoid it but certainly if you are going to go down the route and think a pond is maybe in your best interest those fees would have to be looked at by the way on the financing for another piece of clarification at least our car esko company we have no peculiar very interesting who finances the project so we can help you with financing bring sophisticated lenders with excellent rates to the table we don't get any type of fee for doing that it's just certainly to bring you an ancillary service that helps you get through the project me if this comes off the wrong way if this would would turn into a procurement and we would have to submit a proposal that may put us at it you know at a disadvantage with respect to our competitors especially considering the fact that this is being taped i would say that our profit overhead would be less than what they were but what they run do you have any other question i want to mention when you look at your your district list there are some things there are the other one school is that will continue to move forward with make the district list we kind of put them on our continuing looking at low africa high in this summer's billing cycle i was a little bit surprised five but pleasantly entry said yeah if we've got somebody after things we can cycle it in the summer i think we're crazy not to think he was if you're doing a multi trade char for a project job then a general contractor slash a scar has something to bring to the party when you're finishing up a piece that gets to have a significant degree a single on their list for ten years but you know maybe if you look out for us there there's total cost over here that actually have a dollar figure or that expense so whenever you're looking at that maybe if you can the wind could go over to the ask but we already have purchased and we're waiting for instance lation the nine windows of the library so that i mean i there are some of that around p v area with the university and there's those down there that district already paid money and just really just play you know live short to me one of the biggest priorities here is the ventilation system and that goes in hand in hand with the windows that was a dubious design at the time of construction it wouldn't even be on the design options list today so the idea of doing a one for one replacement is to go any trace of dubious design from on t if it's a cosmetic thing it doesn't look pretty but the building is safe it is on solid rock on the foundation of it so so it i mean it doesn't look pretty there are some owls that are change said you know more about that than i do but the bottom line is your experience is going to be needed this process  all right i want to thank everybody for coming i realize it was