by | January 14, 2013

LED Street Lighting Interview with David Gassaway

Get a hands-on perspective on what it takes to start a citywide street lighting upgrade project. Governing Senior Fellow, Bob Graves interview with David Gassaway, management analyst, City of Rancho Cordova, California.

Get a hands-on perspective on what it takes to start a citywide street lighting upgrade project. Governing Senior Fellow, Bob Graves interview with David Gassaway, management analyst, City of Rancho Cordova, California.

Q – What prompted the City of Rancho Cordova to look into retrofitting its street lighting systems?  

To me, the money is the first thing that comes to mind. We only began looking at LEDs because of how much we thought we might be able to save in the long-term.
     
Q – What are the primary factors driving the transition to LEDs forward?

I would say there are three primary purposes driving our interest:
 
1.  Cost savings. We believe we are going to be saving around 60% or more on electricity costs in the long-term. That is significant considering that the funding source we have for streetlights, a special assessment district, was not established with an adequate inflator. Therefore, more and more of the revenues have been shifted to electricity costs, requiring the City to begin subsidizing maintenance costs with other funds. By reducing the electricity expenditures, we will be able to not only pay down the capital costs – a loan from the California Energy Commission for energy efficiency upgrades to public facilities – but will also be able to reduce the amount of funds we are currently subsidizing from other funds. Once we have the loan paid down we can begin to reestablish our capital reserves.

2.  Environmental Improvement. The City actively seeks ways to be a more energy conscious organization. Since LED lights consume such a smaller amount of electricity, the City is reducing its carbon impact by retrofitting. LEDs, as opposed to incandescent or induction lighting, also do not utilize any toxic gases, therefore reducing landfill pollution. Additionally, thinking further than just carbon and ground pollution, LED lighting is much more controllable (incandescent and induction lighting throws light in 360○) and therefore reduces the amount of light pollution lost into the night sky – creates the City glow effect – and reduces light trespass, which is light that shines into homes that is not wanted. Overall, they just create a healthier environment.

3.  Maintenance Ease. LED lights have about four times longer life than High Pressure Sodium (HPS) or Mercury Vapor (MV) bulbs. This allows us to think much more intelligently about how we maintain and replace street lighting as it nears end of life. Unlike HPS or MV, LEDs do not burn out instantly. Instead, they slowly dim over their life span, preventing need for immediate replacement upon burnout (dimmer lighting is better than dark streets). By knowing generally when your LED lights will need to be replaced, we can schedule citywide replacement of all street lights over the course of two or three years, 20 years from now. That will allow us to utilize the current level of technology for the next 20 years, reducing substantially the number of “callouts” for burnt out bulbs, all the while allowing the technology to further advance for the next two decades. Who knows how cool the stuff we replace these LEDs with will be.  
 
Q – Have you reached the stage of developing an RFP?  If yes, what have been the best resources for this particular element?

I have looked over about a dozen streetlight retrofit RFPs in the past few weeks. I would say we are about 80% towards being ready to actually sit down and develop the RFP. We tried to do as much due diligence as possible, creating a fairly extensive analysis of long-term savings vs. capital expenditures. The numbers indicate that we will see about a 9 year ROI. From there, the next 11+ years will be cost savings.
 
Q – What are the primary barriers?

Not sure yet. Information has been one that I’ve tried tackling by simply doing my research and talking to who I can talk to. Certainly cost is a barrier. The City’s retrofit will cost on order of $1.8+ million, which is a price at which financing becomes a necessity as there is not capital reserves in our street lighting funds. The other barrier I can think of is our utility provider. Many of our streetlights are unmetered, and therefore we pay a flat rate. If we plan to utilize the dimming technologies (explained in the next paragraph) then we need to figure out how we can factor further energy reductions by lights that dim when nobody is around. If there is no meter attached, then there is no way to measure the energy savings. And installation of meters throughout the City may not be cost effective for our utility or us.
 
Q – What are the advanced feature options that you want to add at a later date? 

Some of the cutting edge stuff right now are sensors and controllers that dim lighting when nobody is around, and brighten lighting when pedestrians or cars approach. There are also some trials going on with lighting systems that are centrally controlled by a “brain.” This would allow lights to adapt to changing situations. For example, say the lights generally run about 75% of full power from 7-10pm, and then 50% power from 10-pm to 5am. If there were an emergency in the middle of the night, say the PD was looking for a suspect, then the lighting system could be illuminated to 100% instantly, producing far greater amounts of light and less shadows for hiding. The same could be done for a fire, or medical emergency. The “brain” would really just be a way of managing lights as a network, instead of individual light poles as we do now.
 
All that said, this technology is not yet fully baked or ready for prime time. So, as we are moving forward with our retrofit, we are trying to be sure we purchase lighting that is upgradeable to utilize sensors in the near future, and probably that is capable of being upgraded to integrate into a wireless network a little further down the road. However we do it, we just want to be smart about positioning ourselves to take advantage of technologies that are on the 5-10 year horizon (since we know we will have these lights for 20+ years).
 
Q – Based on your experience what are the questions you had to answer to assess the feasibility of going out with an RFP?

Well we conducted a financial analysis internally. It involved finding current market prices for high-end LED streetlights, calculating potential energy savings based on our local electricity rates compared to our existing lighting infrastructure, and factoring how financing those upgrades would fit into the equation.

Q – How can Governing help local jurisdictions?

In regards to your role as the media, I think the more information and connections to information you can provide, the better. Most of the articles I have read about LED lighting only discuss it in terms of how great it is, how much money folks are saving, and what the future might hold for smart network systems. There has not been a lot of meat such as: the City of Yuba City did LED retrofits like this; City of Hayward did LED retrofits like this; Los Angeles County did retrofits like this; California Department of Transportation... you get the picture.

Q – Where did you go in your search for financing options?

I had heard of a California Energy Commission loan. I also spoke with some of the national vendors/contractors and they too mentioned offers of low interest financing (sub 3%). The only snag I saw with them was that a jurisdiction would be required to make carrying the note a part of the RFP or bid process.

Q –  You mentioned the CEC loan program.  Did you try the www.dsireusa.org website as a finance resource?

I’ve used the dsireusa website extensively in the past when I was working on an idea for financing large scale, greenfield residential development of solar PV. Dsireusa.org is a good tool, but really only useful on the incentives side of things. The CEC funding and Sacramento Municipal Utility District (SMUD) rebates are the only eligible incentives for our particular project. However, you should still look to this site as a place for information for interested jurisdictions as they may be interested in taking advantage of tax credits by installing lights as a lease lease-back (similar to a power purchase agreement for solar) in situations where a jurisdiction may be willing to give up ownership of their system for a time.

Q – Did you go to other resources like the utilities?

SMUD was a great help in determining how the cost savings would pencil out and for what rebates we would be eligible for. I highly suggest that a jurisdictions electrical utility be the first contact when considering a street light retrofit. PG&E, for example, offers full turnkey services for jurisdictions in their coverage as a way for them to lower electricity demand system-wide.
 
Q – Are you familiar with the California Lighting Technology Center (CLTC) at UC Davis http://cltc.ucdavis.edu? Have you used them in any way as a resource? 

Thank you for bringing this back into my memory. Yes, I have heard of it. In fact, a CLTC webinar was what originally turned me on to conducting the analysis of whether or not a retrofit would benefit Rancho Cordova.
 

Bob Graves  |  Associate Director of the Governing Institute
bgraves@governing.com

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