Montgomery begins to tally costs of energy proposals -- Gazette.Net


As a package of environmental bills works its way toward a vote in the Montgomery County Council, county departments say some of the measures could cost millions.

Councilman Roger Berliner (D-Dist. 1) of Bethesda introduced a package of 11 bills and two zoning text amendments in January designed to increase Montgomery County’s position as a national leader in clean and sustainable energy.

The county’s offices of Finance and Management and Budget this week submitted reports on the expected fiscal and economic impacts of several of the bills.

One bill would require the County Executive to create a plan to require clean energy devices to be installed in county facilities.

The bill allows the county to enter into “power purchase agreements,” in which the county hosts an energy facility and purchases the power it creates rather than building its own facility.

But the county report notes that the purchase agreements haven’t been used extensively for new construction and rely on federal tax credits to make them attractive.

“[Power Purchase Agreements] are currently economically viable for investors due to federal tax credits which are scheduled to expire at the end of 2016,” the report said. “Once the tax credits expire, it is possible the cost of installing the PPAs will not be economically viable.”

Another bill would require the county to buy at least half of its energy from renewable resources by 2015 and 100 percent by 2020. The county currently buys about 30 percent of its energy from renewable resources.

The county currently buys renewable energy certificates, independently traded commodities representing the environmental, social and other qualities of renewable energy creation.

The county report warns that prices for the certificates can fluctuate wildly.

While prices are currently low, over the past 10 years prices have varied by more than 600 percent for the same product, it said.

The Department of General Services estimates that the bill would cost Montgomery an extra $75,000 in fiscal 2015 if it is passed and implemented, and from $480,000 and $1.1 million by fiscal 2020 based on an expected average rise in energy prices and the cost of renewable energy certificates added onto the cost of traditional electricity.

One bill would require the owners of nonresidential buildings to establish a benchmark for their buildings’ energy usage and make some of the information available to the public.

Buildings that use energy more efficiently have higher occupancy, are able to charge higher rents and achieve higher property values than buildings that are less efficient, according to the county report.

But it isn’t possible to determine the costs that benchmarking would create for building owners, it said.

Many building owners already use the free software program used in the benchmarking process and would have minimal costs.

But property owners who aren’t using the tool could have some cost to gather the energy data the program needs.

Another bill originally proposed creating a new county Office of Sustainability within the county’s Department of Environmental Protection. The council committee considering the bill before it goes to the full council for a vote has suggested changing it to create an Office of Sustainability within Environmental Protection, which would focus on promoting sustainability with the public, and a separate Office of Energy and Sustainability within the Department of General Services that would work on sustainable activities within county government organizations.

The new offices would require seven new full-time county employees

The bill would cost an estimated $4,772,664 over six years, along with $60,200 in startup costs.

General Services staff think the bill could lead to energy cost savings, but the costs to implement the steps to create the savings cannot be determined, according to the county report.