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Holland Energy Plan Scores Its First Big WinPrint

Clean Energy | August 30, 2016 | By Jim Dulzo

Holland Energy Plan Scores Its First Big Win

Holland’s highly efficient new gas-fired power plant, still under construction, has already won a sustainability award for, among other things, the restoration and preservation of trees and wetlands on the site. (Jim Dulzo/Groundwork Center)

HOLLAND—Sparked by its pioneering Community Energy Plan, this old Lake Michigan port town is bustling with new activity as it works to become one of North America’s most clean-energy-savvy cities.

At the northeast edge of town a highly efficient, $240 million gas-fired power plant has already won an award, even though it is still being built, rising on land once covered with worn houses, fading businesses, and trash-choked wetlands.

Meanwhile, downtown merchants eagerly await the arrival, via underground piping, of waste heat from the new plant, to expand their popular snowmelt district.

At City Hall and the Holland Board of Public Works (HBPW), officials are finalizing a unique, municipal Home Efficiency Retrofit service designed to help any responsible homeowner increase their house’s comfort, economy, and value.

In the neighborhoods, 5,400 of those homeowners have “goody bags” stuffed with an LED light bulb, discount coupons for energy-saving appliances and services, and energy-smart tips, delivered by young canvassers boosting another city campaign: competing for the Georgetown University Energy Prize, worth $5 million to the town that most improves its efficiency.

The contest is even drawing in moviegoers. They show up by the hundreds for Free Family Movie Nights at the city’s Kollen Park, forsaking their power-gobbling TVs and air conditioners for summertime socializing and a chance to hear about the Prize and Holland’s broader energy plan.

The CEP, envisioned by the Holland Sustainability Committee, authored by efficiency consultant Garforth International, and adopted by city council in 2012, is a 40-year blueprint for cutting the city’s per capita greenhouse gas emissions rate from one of America’s highest to one of the developed world’s lowest, making it a globally attractive city for businesses and their workers.

The award for the unfinished plant, the emerging home retrofitting service, and the vigorous Georgetown campaign indicate that Holland takes its CEP seriously and is seeing encouraging results.

 

Conversation and Cleanup

That is especially true of the gas plant, dubbed the Holland Energy Park. In July it won the Institute for Sustainable Infrastructure’s Envision Platinum Award, its top rating, which has gone to just 15 projects, and never to a power plant.

Dave Koster, HBPW’s general manager, says the energy park won ISI’s award for the same reason Holland’s energy plan is succeeding: community involvement.

“This award is much more about the process that led to the plant than it is about the final outcome,” he said during an interview at the plant construction site. “The leadership rating was very high because of the many ways we engaged the community.”

That engagement began in 2007, when Holland signed the U.S. Conference of Mayors Climate Protection Agreement and appointed local residents to a new sustainability committee. Two years later, the HSC ran smack into the controversy over HBPW’s proposal to replace its aging coal plant with a brand-new one. The HSC began studying the city’s future energy needs and eventually presented a highly researched energy plan to the city. It heavily promotes efficiency, prefers gas to coal, and includes renewables in its later years.

The city adopted the plan in 2012, but chose the gas plant only after more public discussion based on a study comparing coal’s and gas’ economic and environmental effects. Another citizen group designed the park and the plant’s exterior as an eye-catching city gateway; a destination for bikers and strollers; an educational resource; and a way to restore what Koster called “a sort-of forgotten area of the city.”  

“The beautiful wetland behind this site was dumped in a lot,” Koster recalled. “The old interurban that used to bring people to the lakeshore ran right through here. The ways we thought beyond the plant itself were all very intentional. It goes back to why we won this award.”

Chris Van Dokkumburg, HBPW’s strategic business planner, pulled together many kinds of evidence for the Envision application.

“We sent in meeting minutes, sign-in sheets, listed the tons of material we recycled from the site, the number of plants we saved, the number of trees we saved, the mitigated invasive species, the stumps we pulled up and transported to other wetlands,” she said.

Landscaping for the 26-acre park begins next spring, but cleanup is complete. HBPW also told ISI that demolition crews tore down 61 buildings, removed 11.5 tons of asbestos, collected 296 tires, crushed 12,600 tons of concrete and masonry material for onsite reuse, and steered 14,000 tons of material away from landfills. 

“Our engineers sent them data about the efficiency of the plant, too,” Koster added.

 

Terrific Numbers

Dan Nally, HBPW’s plant construction manager, said that data is strong. Because the plant uses its two gas turbines’ excess heat to drive a steam turbine and expand the existing downtown snowmelt service beyond what the city’s old coal plant could handle, it will be extraordinarily efficient.

“The best coal plants operate at 38 percent efficiency,” Nally, a veteran plant builder, said. “This plant gets 55 percent. When you add the snowmelt, it’s 61. And if we add district heating (sending waste heat to buildings not using furnaces) you push it to as much as 70 percent. That’s world class.”

“Hey, we’re Dutch here,” he added, smiling. “We’re pulling every red cent out of this we can, along with less greenhouse gas. It’s a very efficient way to run a city, from both a power and heating perspective.”

Koster said that the plant would land HBPW in a good place if the U.S. EPA’s Clean Power Plan, requiring utilities to cut greenhouse gas emissions, overcomes court challenges. He added that CEP and the plant attracted outside attention well before the ISI award.

“Dan’s talking with other power companies around the country,” he said. “And Lansing is looking at Holland, too.”

In late 2014, at Holland officials’ urging, Lansing enacted legislation supporting Holland’s CEP. It allows Michigan’s municipal and co-op utilities to use “on-bill financing” that puts customers’ home efficiency loans on their monthly bills. On-bill is supposed to be the key to an ambitious CEP goal: efficiency retrofits for Holland’s 7,400 homes that cut their gas and electric use by 50 percent by 2050.

 

An Inclusive Good Deal

Much of Holland’s housing stock is old and inefficient. Peter Boogaart, the city’s first-ever residential energy adviser for its nascent Home Energy Retrofit Program, adds that 35 percent of the city’s households are “asset limited, income constrained, yet employed” and another 9 percent are living in “flat-out poverty.”

“That means 43 percent of our households are at least somewhat at risk financially,” said Boogaart, who worked with Ottawa County’s Community Action Agency, helping low-income families tighten homes and cut daunting energy bills. “One of the wonderful things about our Plan is that it can take the energy economic burden off of people who need the most relief.”

But Boogaart will work with plenty of financially comfortable households, too, although experience suggests many will be initially reluctant to invest in efficiency.

HBPW’s on-bill financing empowers Boogaart’s department to meet both challenges. The utility placed $3 million of its own reserves, which typically earn low interest, into the city’s newly formed Holland Energy Fund. Any customer, including many most banks would ignore, can qualify simply by having a one-year perfect record on utility bills and no debt-related legal troubles.

Terms are 4.9 to 5.9 percent for up to 15 years. Officials hope that on-bill convenience, which will show how energy savings are helping to repay modest loan notes, proves attractive.

The city is chipping in by hiring Boogaart and dedicating $200,000 for a 20-percent match toward projects costing at least $10,000.

The On-Bill Loan Program follows a 2015 pilot program executed by Schneider Electric, a large efficiency services company that targets big commercial operations. Schneider engaged 25 homeowners with full home energy analyses; 15 contracted for major improvements. Boogaart said it’s too early to determine those projects’ savings, but that the city is ready to go ahead.

“I’ll be there on behalf of homeowners to make it as streamlined as possible,” he promised. “One-stop shopping, financing, technical questions, especially when they get a full home energy evaluation. You can sit down with the city—that’s me—and learn what it all really means.”

The program is set to launch on Oct. 1, Boogaart said, after delays to sort out “all sorts of contractual and fine print work.”

That included securing HBPW and the city’s capital commitments from HPBW, finding a bank to manage on-bill loan applications, and engaging Michigan Saves, the statewide non-profit that lends to homeowners, small businesses, schools and municipalities for efficiency projects and vets contractors. Participants can draw from any capital source, but on-bill is only available for HBPW’s loans.

“People are really intrigued by on-bill financing,” says Boogaart, who’s speaking with the 114 people already signed up. “I don’t think it’s a tough sell when the city comes along with a way to make their home better—lower bills, better quality of life. They say, ‘Yeah, I would do that if I could pay for it.’ Well, we’ve created a way to clear that first, high hurdle.”

 

Pleased and Impressed

Ironically, one of the biggest assists in reaching the audacious CEP goal—touching every house in Holland—is from out of town. City and HBPW officials are pushing the Georgetown University Energy Prize competition, which Holland entered in November 2014. If the town’s homes, schools, and municipal buildings cut per capita energy use more than the 50 other competing cities, Holland wins $5 million—a fine addition to its energy fund.

Anne Saliers, HBPW’s community energy services manager, says officials are using the Energy Prize to build interest in saving energy and, ultimately, the CEP. If people get excited about the Energy Prize, and especially if Holland wins, it will give the CEP a big boost.

So the city and HBPW stage quarterly, awareness-raising community promotions—drawings for a high efficiency refrigerator and freezer, furnace tune-ups, door-to-door goody bags, movie nights with videos about the competition by hometown hero and Washington Redskins quarterback Kirk Cousins.

“I’m just very impressed with the resolve of the City of Holland and Holland BPW to actually bring these programs to market and institutionalize them. They are very complex and it is no small matter to think about using up to $3 million of your cash reserves as a line of credit to your homeowners,” Saliers said.

Boogaart sounds happy, too.

“I’m rather pleased,” he said. “We worked as a task force for four years to get through all the details and recommendations for city council. Those who are activists were ready to go on day one, but in reality everybody has to be brought along. When we do that, they have confidence in it.”