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Home My WebLink About02/19/2025 - Economic Advisory Board - AGENDA - Regular MeetingEconomic Advisory Board REGULAR MEETING February 19, 2025, 4:00 p.m. - 6:00 p.m. HYBRID MEETING OPTIONS 215 Laporte Ave EOC . Microsoft Teams:eab- 1.CALL TO ORDER 2.ROLL CALL 3.AGENDA REVIEW 4.CITIZEN PARTICIPATION 5.APPROVAL OF MINUTES 6.NEW BUSINESS a. Presentation and Discussion – Building Performance Standards (4:00- 4:50pm) b. Presentation and Discussion – Urban Renewal Authority North College Activity (5:10-6:00pm) 7.UNFINISHED BUSINESS 8.BOARD MEMBER REPORTS 9.OTHER BUSINESS a. Vice Chair Discussion 10.ADJOURNMENT 2/19/2025 – AGENDA Headline Copy Goes Here Energy Services Program Manager Katherine Bailey Energy Services Manager Brian Tholl Jan. 14, 2025 Proposed Building Performance Standards (BPS) Policy Framework Headline Copy Goes HereBPS Introduction 2 Purpose of work session #3 on BPS: Share learning from ongoing community engagement and BPS implementation in other jurisdictions Highlight potential tensions between this policy framework and other Council Priorities, e.g., housing, economic health Discuss trade-offs and possible paths forward Headline Copy Goes HereCouncil Questions Does Council have feedback on a local BPS framework as a regulatory method of advancing the community to 2030 and 2050 goals? Does Council have feedback on adjusting proposed timelines, maximum reduction caps, or covered buildings? What other considerations should staff incorporate into the proposed BPS framework? Headline Copy Goes HereBPS Benefits Environmental Health Physical Health Economic Health Comfort Health Safety Resilience Occupancy & tenant retention Economic growth, resale value, competitiveness Energy burden through use and rate pressure Natural Gas impact Emissions impact BPS Regulatory actions, including BPS, are necessary for achieving OCF emissions goals Headline Copy Goes HereCase Studies Small, Local Grocery Lighting, controls, refrigeration, case upgrades $58,000 investment $28,000 rebates $16,000 annual est. avoided utility costs Reduced electric use by 53% Meeting BPS grocery target Local Congregation Upgrades planned to meet sustainability vision of members Photovoltaic installation Efficiency upgrades and high efficiency expansion project Staff note improved comfort and work environment Community members now enjoy the sanctuary in all seasons Municipal Office Modified HVAC maintenance practices & commissioning No capital investment; avoided potential, expensive HVAC upgrade Reduced electric use by 11.5% Meeting BPS office target Headline Copy Goes Here Building owners Building occupants Local, not meeting target <550 People living in multi-family buildings ~17,000 bedrooms People working in office buildings ~11,500 workers on main shift Buildings are community assets Headline Copy Goes HereCouncil Considerations from Feedback Community Concerns Inequitable economic impacts across different building types Accuracy of projected impact on all properties Recommended Implementation Levers Possible Policy Levers ii Adjustments Specialized resources for market segments Increased support Educational support Technical support Financial Navigator Modify timeline Extend community deadlines Lead with municipal Modify target requirement Adjust cap Modify covered buildings Exclude small buildings or certain property types Headline Copy Goes HerePolicy Lever Trade-offs Policy Lever Potential Change Upfront Economic Impact Environmental Impact Administrative Impact Timeline Extend compliance 3-5 years Minimal Half-percent of OCF goal per year Moderate Target Requirement Reduce maximum reduction cap by 5% High High Minimal Covered Buildings Exclude buildings 5,000-10,000 ft2 Minimal Minimal Moderate Exclude multi-family buildings High High Moderate Headline Copy Goes HereEconomic Impact: Costs and Savings Average building upgrade simple payback is eight years $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 2025 2030 2035 2040 2045 2050 Community Cost Before City Incentives Energy Cost Avoided Cumulative energy cost avoided exceeds total community costs starting in 2038 Estimated Building Owner Costs $226 million costs exclude rebates, business as usual assumptions $4-5 / square foot Estimated Savings By 2050, covered building owners would avoid $630 million in energy costs By 2050, BPS economic benefit is $2.80 in energy cost avoided for every $1 spent Headline Copy Goes HereLearnings and Opportunities Other Jurisdictions Critical elements: Support (educational, technical, financial) Role of alternate pathways, rules Timeline consideration Municipal Buildings City buildings are ahead on energy performance and meeting targets 55% of covered municipal buildings are meeting proposed targets $5.3 million estimated investment for remaining building improvements Opportunities U.S. Department of Energy grant for community technical and financial BPS assistance $4.5 million over six years Distribution expected to begin July 2025 Headline Copy Goes HereCouncil Questions Does council have feedback on a local BPS framework as a regulatory method of advancing the community to 2030 and 2050 goals? Does council have feedback on adjusting proposed timelines, maximum reduction caps, or covered buildings? What other considerations should staff incorporate into the proposed BPS framework? Headline Copy Goes Here Questions on BPS: Kbailey@fcgov.com 970-221-6818 ourcity.fcgov.com/BPS Program Manager, Energy Services Katherine Bailey Headline Copy Goes Here Program Manager, Energy Services Katherine Bailey Additional Context Headline Copy Goes HereBPS Policy Framework BPS sets efficiency targets accounting for current usage (actual building use represented in graph) More efficient buildings already meet targets (green dashes) Buildings not meeting targets make behavioral or efficiency changes "Caps" are percentage limits on the per building maximum energy reduction required (purple dashes indicate buildings eligible for cap) Customized solutions are available for special circumstances Through implementation, the City is committed to communicating required actions, while providing the right resources and support to building owners 5,000- 10,000 ft2 10,000 ft2 and above Covered Office Energy Use Intensity by Building (kbtu/ft²) Headline Copy Goes HereBPS Overview: Covered Buildings in Fort Collins Building Size Building Count Building Count Reduction Target Reduction Target Reduction Target Upgrade Cost (Per Square Foot) Number of total buildings Buildings that need to act Compliance requirement timeline Individual reduction cap Average reduction to target 5,000- 10,000 square feet 310 200 (65%) 2035 15% 9% $4.10 to $4.60 10,000+ square feet 780 520 (66%) 2030 25% 13% $4.70 to $5.10 State covered 50,000+ square feet 80 60 (77%) 2030 29% 17% $4.40 to $4.70 Based on 2023 reported benchmarking data; some buildings are campuses which include multiple structures Headline Copy Goes HereMunicipal Buildings About 55% of City-owned buildings already comply with proposed BPS efficiency targets For City-owned buildings that do not comply with proposed efficiency targets, staff forecast about $5.3 million of additional capital funds would be needed to reach 2030 and 2035 efficiency targets A third-party consultant is providing support; reviewing upcoming projects and aligning them with local, state and federal funding sources, including both tax credits and other up front funding resources, to complement Budgeting for Outcomes offers Headline Copy Goes HereFort Collins Community Engagement Hours People Engaged Audiences Community Engagement 2023-2024 ~175 ~700 Technical, Industry, Business, Environmental, Boards, Owner representatives, tenants, and more Learnings: Multi-family tenants are significantly impacted by holistic costs (including utility costs) and face challenges advocating for improved living conditions. BPS compliance costs lead to direct payback to rate payers in the form of reduced utility costs. Significant resources are essential for policy success, particularly education. Awareness and knowledge are key barriers to efficiency. Split incentive is ongoing concern. Tenant owner education is essential. + additional engagement with other jurisdictions and federal partners Headline Copy Goes HereCommunity Contributors Community contributors shaped BPS policy recommendations Equity Engagement BPS ExpertsTask Force Industry Experts Technical Committee Community Voices Building Science Experts Experienced Consultant Community- Based Organizations Climate Equity Committee Scoped Work Other Jurisdictions Non-profit and Federal Groups Business Groups Environmental Groups Boards and Commissions Headline Copy Goes HereHousing Affordability Multi-family Buildings R2 occupancy, 3+ stories above grade 148 covered multi-family campuses (out of 4,136 local multi- family campuses) Average covered campus size: 80,000 square feet 102 campuses are not meeting targets Average cost: $4-5 per square foot, <8 yr simple payback 17% of total opportunity and costs 30% of total covered square footage Subsidized affordable housing included in proposed policy Housing Catalyst projects follow Enterprise Green Communities criteria (national green building guidelines specifically for affordable housing) Headline Copy Goes HerePolicy Lever Trade-offs Policy Lever Potential Change Economic Impact Environmental Impact Administrative Impact Timeline Extend compliance 3-5 years Minimal inflation / NPV Half-percent per year progress to OCF emission goal Moderate upgrades over time Maximum reduction cap Reduce cap by 5% High 20% of costs High 20% reduced emissions reduction Minimal similar administrative resources Covered buildings Exclude buildings 5,000- 10,000sf Minimal 5% of costs Minimal 5% reduced emissions reduction Moderate reduce # of covered buildings Exclude multi- family buildings High 17% of costs High 17% reduced emissions reduction Moderate reduce # of covered buildings Headline Copy Goes HereCompounding Levers Estimated impact on GHG savings and costs with overlapping scenarios : Excluding multi-family AND cap reduction; Excluding small buildings AND cap reduction; Excluding both multi-family AND small buildings AND cap reduction Excluding multi-family buildings AND lowering maximum reduction cap by 5% Excluding small buildings AND lowering maximum reduction cap by 5% Excluding multi-family AND small buildings AND lowering maximum reduction cap by 5% 35% impact on GHG and costs 24% impact on GHG and costs 39% impact on GHG and costs Headline Copy Goes Here Efficiency is cheaper than electric rates Administrative & Utility: BPS administrative costs are significantly less than wholesale energy costs per MWh Efficiency is cheaper than new energy generation Efficiency minimizes need for distribution upgrades Community: BPS community costs are less than 2024 electric rates per MWh Efficiency supports strategic electrification Reduces costs community-wide Headline Copy Goes HereEnvironmental Impact Natural Gas BPS is a significant portion of projected natural gas savings More natural gas savings projected from BPS (3 million therms) than electrification (2.5 million therms) by 2030 Remaining potential savings are from proposed regulatory residential pathways BPS enables future electrification through efficiency Do Nothing More Forecast with Past Impacts AND Forecasted Moves Pathway 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 80,000,000 90,000,000 100,000,000 Community Natural Gas Consumption therms Forecast Fort Collins Our Climate Future Adopted Avoided from past Energy Services and Xcel Energy Program participation Potential from Our Climate Future Next Moves Pathway Supply from Xcel Energy Headline Copy Goes Here 24 Renewables and Efficiency Efficiency Enables Renewables Efficiency reduces energy use Reduced energy use increases impact of existing and new solar Efficiency balances impact of electrification Local Renewables as a Percent of Resource Mix (generation % of operational consumption) 0.1%0.2%0.2%0.2%0.3%0.4% 0.6% 0.9% 1.0% 1.2% 1.5% 1.9% 2.2% 2.6% 3.2% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% with efficiency impact 0.1%0.2%0.2%0.2%0.3%0.3%0.6%0.8%1.0%1.1%1.3% 1.6%1.8%2.1% 2.5% 0.3% 0.3% 0.4% 0.7% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% Headline Copy Goes Here Denver BPS targets Developed to support local bill requiring 30% total energy savings from BPS Fort Collins BPS targets Developed with a focus on achievability Proposed Denver requirement updates and considerations Included in Fort Collins proposal? Building target adjustments Maximum Reduction Cap (42%)(15% and 25%) Waivers for occupancy and financial distress Local Policy Comparison: Lessons from Denver Municipal Codes and Administrative Rules Denver proposes updates to Administrative Rules Municipal Code should allow for (and encourage) rule updates throughout implementation as warranted; (through flexible code language) affect owners not in compliance at target deadline) Headline Copy Goes Here For More Information, Visit THANK YOU! ourcity.fcgov.com/bps