During that time, however, there would be no “out-of-pocket” expenditures by the town. The debt would be paid from savings the town experiences once Siemens completes the energy efficiency project.
Those savings are determined through a study conducted by Siemens, and the savings are guaranteed by Siemens.
Members of the BMA weren’t prepared to make a decision during the July 25 special called meeting when Siemens made its presentation. The board agreed to discuss the plan further when it meets on Aug. 13.
What Siemens was asking of the BMA July 25 was a letter of intent, which would prompt Siemens to conduct further study on potential energy savings. If the BMA had approved the letter of intent last week and later declined to accept the overall plan, it would owe Siemens $48,000 to cover costs of the advanced study.
Based on the results of a preliminary study, Siemens proposes a four-part energy efficiency plan, although the lion’s share of the work would take place within the water department.
At a cost of $3.1 million, all 4,000 city water meters would be replaced with new meters that can be read online by both the customer and the water department. The plan calls for the elimination of meter-reading duties as well as the water department’s $34,000 annual billing cost.
Other aspects of the program include lighting upgrades and controls at City Hall, Rogersville City School and all other city facilities.
Although RCS completed an energy efficiency lighting upgrade last year, Siemens says the school could save another $13,000 per year with some lighting control installations.
Streetlights would also receive LED upgrades.
“We come in and look at your infrastructure and look at energy efficient improvements,” said Tracy Raulerson, Siemens business development manager. “But we do the energy efficient improvements with no up-front cost. Any of the retrofits that we present to the town of Rogersville would be guaranteed, and the savings would be paid for through your existing operational budget.”
Raulerson added: “We look at your current utility bill, and that gives us a baseline. We fund the project, which will decrease your utility bill. What we choose to implement will be more energy efficient along with driving additional revenue through the town for your water utility.”
City Attorney Bill Phillips compared the debt aspect of the program to a capital outlay note.
“Siemens guarantees that your savings will meet or exceed any payment you would make to retire that within 14.49 years,” Phillips said. “You’re not going to lose anything. The good chance is during that 14.49 years, you’ll be saving money in addition to paying for it. There’s nothing out of pocket, and at the end of the 14.49 years, the savings are all yours.”
Phillips added: “The town of Rogersville will incur a debt obligation, which will be more than paid for each year by the savings that the town gains.”
Rogersville Water Superintendent Shawn Hatchett expressed concern about the water utility aspect of Siemens’ plan, which he described as too aggressive. Hatchett suggested completing the meter replacement in phases.
“What do we do in 15, 20 years when these meters all have to be replaced at the same time?” Hatchell said.
Siemens representatives replied that energy cost savings will generate enough revenue to replace meters when the time comes.
Alderman Brian Hartness made the motion to postpone any decision on the Siemens proposal at least until the Aug. 13 meeting.
“Four million dollars is a lot to make our townspeople responsible for if we make this decision for them. I’m not saying I don’t want to do this. I’m saying I think I need some more time before I make this decision, he said.”