Resolution No. 7632r
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-RESOLUTION NO. 7632
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING FOR IMPLEMENTATION
THE CUSTOMER INCENTIVE AND CUSTOMER DIRECTED
PROGRAMS RELATING TO THE CITY OF VERNON UTILITIES
DEPARTMENT PUBLIC BENEFITS PROGRAMS
WHEREAS, AB 1890 included a state -mandated Public Benefits
Charge to be collected from all of the City of Vernon's customers with
the intended purpose of funding the following Public Benefits
Programs:
• Energy Efficiency
• Research, development and demonstration.
• Low-income assistance
• Renewable resource technologies; and
WHEREAS, the City of Vernon Utilities Department assessed
customers' needs and interests and determined that programs in the
area of energy efficiency would be of benefit to electric customers
and is still studying and evaluating the option of purchasing
renewable energy to augment Vernon's power resource mix; and
WHEREAS, on March 21, 2000, the City Council of the City of
Vernon adopted Resolution No. 7511 which adopted the City of Vernon
Utilities Department Public Benefits Program consisting of the
following five projects in the area of energy efficiency, the first
two of which were the only programs completed for implementation, with
the remaining three to be implemented when they were completed:
1. Energy Audits
2.Energy Education and Demonstration Workshops
3. Equipment Loans
4. Customer Incentive
5. Customer Directed Projects; and
I WHEREAS, by letter dated September 14, 2000, Bruce V.
2 Malkenhorst, City Clerk, recommended that the Customer Incentive and
3 Customer Directed Programs in the Public Benefits Programs be
4 authorized for implementation now, with the one remaining program to
5 be implemented later when it is completed; and
6 WHEREAS, in order to satisfy the requirements of AB 1890 and
7 Section 385 of the Public Utilities Code of the State of California,
8 the City Council desires to approve and authorize for implementation
9 at this time two of the projects contained in the City of Vernon
10 Utilities Department Public Benefits Programs, namely, the Customer
11 Incentive and Customer Directed Programs.
12 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
13 CITY OF VERNON AS FOLLOWS:
14 SECTION 1: The City Council of the City of Vernon hereby
15 finds and determines that the recitals contained hereinabove are true
16 and correct.
17 SECTION 2: The City Council of the City of Vernon hereby
18 approves and authorizes for implementation at this time two of the
19 five projects contained in said Programs, the Customer Incentive
20 Program, a copy of which is attached hereto as Exhibit "A" and made a
21 part hereof, and the Customer Directed Program, a copy of which is
22 attached hereto as Exhibit "B" and made a part hereof.
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I SECTION 3: The City Clerk of the City of Vernon shall
2 certify to the passage of this resolution, and thereupon and
3 thereafter the same shall be in full force and effect.
4 APPROVED AND ADOPTED this 19`h day of September, 2000.
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7 ONIS C. MALBURG, Mayor
8 ATTEST:
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11 BRUCE V. MALKENHORST, City Clerk
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STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I, BRUCE V. MALKENHORST, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution No.
7632, was duly adopted by the City Council of the City of Vernon at a
regular meeting of the City Council duly held on Tuesday, September
19, 2000, and thereafter was duly signed by the Mayor of the City of
Vernon.
(SEAL)
BRUCE V. MALKENHORST, City Clerk
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EXHIBIT A
t
Vernon Utilities Public Benefits Programs
Customer Incentive Program Proposal
Program Objectives:
• Promote long-term energy efficiency by encouraging commercial and industrial customers
to implement energy efficiency measures that exceed minimum standards;
• Provide incentives that encourage customers to investigate and apply the latest energy
efficient technology;
• Promote economic development and business retention by attracting and retaining
customers who will enjoy the benefits of energy efficiency.
• Encourage customer investigation of efficiency opportunities
• Improve competitiveness of Vernon businesses
• Increase customer awareness of efficient practices (including O & M)
Customer Class: Commercial and Industrial
Energy End -Use Technologies: High efficiency lighting, motors, controls, energy
management systems.
Energy End Uses: Lighting, air compressors, production equipment, HVAC-
Start Date: October, 2000
Length of Program: One year pilot --continuity subject to customer
participation
Annual Program Cost: $345,000 (50% lighting, 50% other)
r
TABLE OF CONTENTS
I. OBJECTIVES
11. BACKGROUND
111. PROGRAM DESCRIPTION
IV. PROGRAM IMPLEMENTATION
V. PROGRAM COSTS AND BENEFITS
VI. SUMMARY AND RECOMMENDATIONS
VII. ATTACHMENTS
I. OBJECTIVES
The Customer Incentive Program is designed to assist the City of Vernon Utilities Department
(Department) in achieving its Public Benefit Program, demand -side management (DSM)
goals. The program objectives are as follows:
• Promote long-term energy efficiency by encouraging commercial and industrial customers
to implement energy efficiency measures that exceed the minimum standards established
by Title 24 or general industry standards;
• Provide incentives for customers to apply the latest technology and energy using devices
that are otherwise cost -prohibitive;
• Promote economic development and business retention by serving as an instrument to
attract and retain customers who will enjoy the long-term benefits of energy efficiency.
II. BACKGROUND
In response to Assembly Bill 1890 regarding California electric utility restructuring, the Vernon
City Council, by Resolution, established the Public Benefit Programs (PBP) and enacted a
California Public Benefits Charge at its meeting of December 16, 1997. Paragraphs (1), (2),
and (3) of subdivision (c) of Section 381 and Section 382 of the legislation specify that the
Public Benefits Charge is to fund investments by the utility and other parties in any or all of the
following:
(1.) Cost-effective demand -side management services to promote energy
efficiency and energy conservation;
(2.) New investment in renewable energy resources and technologies consistent
With existing statutes and regulations which promote those resources and
technologies;
(3.) Research, development and demonstration programs for the public interest
to advance science or technology which is not adequately provided by competitive
and regulated markets;
(4.) Services provided for low-income electricity customers, including but not
limited to, targeted energy efficiency services and rate discounts.
The City of Vernon may choose any of the four program categories, as long as the emphasis
is on the compliance with the intent of AB 1890. Currently, Vernon Utilities is recommending
programs within the area of energy efficiency, as this meets the expressed interest of
Vernon's industrial and commercial customers. Providing cash incentives for lighting
upgrades and energy efficient technologies is one way of promoting the implementation of
energy efficiency measures.
Through the Customer Incentive Program, the Department recognizes that the customer
knows his or her business and its operation best. It is, however, almost impossible for any
individual or organization to keep abreast of all the changing technologies related to energy
efficiency. Therefore, it is appropriate to have a program that rewards innovation in energy
efficiency whether in terms of hardware or operation.
III. PROGRAM DESCRIPTION
The Customer Incentive Program is designed to encourage energy efficient lighting systems
and the exploration and implementation of energy efficient technologies. Often, the latter
technologies are overlooked because customers are either unfamiliar with them, think they are
too costly to apply at their facilities, or do not believe such technologies can effectively meet
their energy needs. These technologies may address either equipment or operational change,
therefore, if the Department can quantify a demand reduction and/or energy savings, there is
a basis for providing an incentive to assist the customer.
This program provides incentives in two separate areas, lighting, and energy efficient
equipment.
The lighting incentive portion of the program is designed to provide a cash incentive to Vernon
customers interested in implementing the latest lighting technology. Developments in
technology have produced new lamps and related equipment, including T-8 fluorescent lamps,
electronic ballasts, and more affordable compact fluorescent lamps that use less energy and
last longer. The future promises continuing advancement in lighting technology. This program
will provide rebates of $0.055 per kWh of reduced lighting energy usage. The maximum
incentive for lighting improvements by qualified customers is $35,000, or 33% of the ighting
retrofit cost, whichever is less. Rebate amounts will be based. on Department audits as
described in this document.
The non -lighting incentive portion of this program can include, but is not limited to: variable
speed drives, air compressors, motors, refrigeration, chiller replacement, air conditioner
replacement, and building envelope. The Customer Incentive Program also includes energy
management systems and other load and energy controlling devices.
The following is a list of the measures and incentives covered under the non -lighting portion of
the Customer Incentive Program:
Motors - Rebates will be based upon qualifying equipment exceeding the standards set by the
National Energy Policy Act passed in October 1997. Customers will receive $150/kW of
reduced demand above NEPA standard whether the motor is new or a replacement. See
Attachments A and B.
Air Compressors - Rebates will be based upon the efficiency of the installed device. There are
two sets of efficiencies for two different types of air compressors --oil flooded and oil -free. The
rebate will be $150/kW of reduced demand above the set standard for new or replacement air
compressors. See Attachment C.
Other Equipment - Rebate will be based upon $150/kW of reduced demand or
$.055/annualized kWh saved, whichever is greater for replacement of existing equipment.
Savings will be established either through customer metering of load for the existing and new
machines or by the Department's calculation of savings. (Variable volume pumps qualify for
rebates in other applications whenever kWh savings can be verified). For new installations,
the Department will provide rebates only on systems with variable volume pumps. Savings for
new installations will be according to the Department's established formula.
Air Conditioning - All qualifying electric air conditioning equipment (including heat pumps) that
is installed as replacement equipment shall qualify for rebates based on cooling capacity.
Rebates for customers will range between $75 to $150 per ton. See Attachment D.
Other Unspecified Measures - All other measures not specified above that qualify (including
building envelope, refrigeration equipment and operational modification, motor controllers,
variable volume pumps, variable speed drives, chiller replacement, etc.) will earn rebates in
the following manner:
1) $150/kW of reduced demand or
2) $.055 per annualized kWh saved
The greater of the two methods for determining rebates will be applied at the Department's
discretion.
The maximum rebate per customer for all measures under this portion of this program will be
the lesser of $35,000 or 33% of the investment (material & labor and taxes).
In addition to cash incentives, the Customer Incentive Program will include funding for
feasibility studies. The feasibility study is often the first step in determining whether a
particular technology applies to a specific operation or energy using device. Feasibility studies
will be limited to a maximum of $10,000 per project.
IV. PROGRAM IMPLEMENTATION
,Staffing
The Department has engaged an Energy Auditing Services consultant who will provide energy
efficiency audit services and program administration support. Other programs administered
by the consultant and described in companion documents include:
• Feasibility Studies
• Customer -Directed Programs
Specific consultant administrative activities related to the Customer Incentive Program
include:
1. The consultant will provide an energy efficiency opportunities report for each audit
customer. The audit report will include an analysis of all major equipment, proposed
efficiency upgrades, an energy cost evaluation, estimated installation cost, incentive
amount, simple payback, and other benefits.
The consultant will assist the customer with preparation of an energy efficiency incentive
application form to be submitted to the Department with the "pre -approval form" (PF). The PF
will include the customer's agreement that incentive payments are contingent upon installation
of approved projects as described in the form.
2. Participating customers must allow the Department to conduct reasonably
scheduled site visits to verify energy efficiency equipment recommendations,
installation, and impacts.
3. The consultant will assist the customer in obtaining three installation bids for energy
efficiency equipment technologies.
4. In order to maintain eligibility, energy efficient equipment installations must commence
within 90 days of PF approval. Installation must be completed within a subsequent120
day period.
5. The consultant will verify the installation of approved energy efficient equipment or
lighting improvements. Upon verification, the consultant will submit a Project
Completion Notice (PCN) to the Department, verifying that all eligible efficiency
measures have been installed and requesting payment of the authorized incentive.
6. The Department will process the PCN and mail the customer's rebate check within six
weeks of receipt.
Marketing
The outreach and promotion of the Customer Incentive Program will be primarily the
responsibility of the Department staff. This program has one of the larger budgets of any of
the commercial/industrial public benefits programs; therefore, special attention to marketing is
essential to guarantee success of the program.
Air compressors and injection molding are two applications that hold significant appeal.
Previous experience gained by staff indicates that there are considerable potential energy
savings, if these markets are targeted. The businesses that use large air compressor and
injection molding machines are easily identifiable. Workshop attendance rosters and the
customer database will serve to identify most of the large customers who would benefit from
the rebate program.
There are a variety of methods available to effectively promote the Program. These would
include: use of the Internet, direct mail to the top 500 customers, newsletters, customer visits
by Department staff, trade show displays, presentations at business forums and Chamber
meetings.
The Customer Incentive Program must be part of the greater marketing plan the Department
is developing for the Public Benefits Programs. However, the plan must address "the specific
needs of the Customer Incentive Program to ensure the success of this program.
Program Delivery
After an initial expression of interest by the customer, the first step will be to assess the
feasibility of alternate energy efficient equipment. This preliminary assessment will be
performed by the consultant who will provide a demand and energy impact assessment and
cost-effectiveness analysis. The consultant's role in estimating and verifying impacts is an
integral part of the decision -making process. The consultant will provide the results of the
cost- effectiveness evaluation to the customer with an agreement form allowing the consultant
to request vendor bids.
The agreement form will be forwarded to the Department as a notification that incentive funds
may be obligated, allowing the Department to participate in the decision -making loop and to
manage funding for budgetary purposes. In the event that annual program budget limits are
exceeded, the receipt date of the pre -approval form will dictate order of eligibility.
The consultant will help the customer prepare and issue requests for a minimum of three
retrofit proposals. Bids will be returned to the customer. The RFP will allow vendors to
incorporate the anticipated Department rebate as an element of the bid so that the customer's
economic analysis is simplified. The consultant will also review the returned bids with the
customer to assist in bid evaluation and selection. It is the consultant's responsibility to assist
customers in evaluating bids, identifying financing options, and motivating the customers to
undertake implementation of the projects.
Customers electing to participate only in the Customer Incentive Program must adhere to the
incentive application procedures that follow:
Customer Incentive Application Procedure
• The customer contacts the Department or the consultant;
• The consultant will inspect the specific equipment before and after installation
• The consultant will complete all pre -approval and project completion notices. Customer
initiated installations prior to Department acceptance of the pre -approval form may be
rejected;
• Upon project completion, the consultant will prepare the energy efficiency incentive form
and forward it to the Department for approval;
• The Department will process the energy efficiency incentive application and issue an
incentive check to the customer.
Verification
The verification procedure is intended to verify installation of eligible equipment and to confirm
the reasonableness of pre -installation saving estimates. The consultant may use customer
billing histories, customer feedback on lighting schedules and post installation billings to
evaluate impacts.
The consultant must agree to comply with the Department's confidentiality restrictions
regarding use and ownership of customer data obtained in the course of this project. These
restrictions are described in the standard contract.
Program Tracking and Reporting
The consultant will create and maintain records of customer, manufacturer, and installer
contacts within a City -approved database. Hardcopy files will also be maintained for
permanent record. This same information will be used for program process and impact
evaluation purposes. Key problems in achieving sales as well as successful tactics will be
recorded and evaluated to enhance the program. The information recorded in the evaluation
system will include the estimation of load reduction and energy impacts. Files related to the
customer's proposal and the consultant's evaluation of that proposal will be maintained.
The consultant will propose monthly contact and sales goals in its original bid. Progress in
meeting those goals will be monitored on a bi-monthly basis with the following points
considered:
• Program expense
• Labor
• Customer and trade ally contacts
• Customer costs incurred
• Customer complaints
• Customer energy and demand profiles predicted in the absence of the program
• Projects in progress including projected kW and kWh impacts
• Completed and verified projects including kW and kWh impacts
The Department expects all vendors to meet accepted standards of professionalism. The
Department will initiate a review of contractor performance if more than 3 customer complaints
are received in any program quarter.
The Department will require the consultant to justify significant variations in program progress.
Failure to substantially, meet key milestones can be deemed an event of default, at the
Department's discretion.
All information developed or acquired in the course of this project is to remain the property of
the City of Vernon. All hardcopies and electronic data will be transferred to the Department at
the completion of this contract. The consultant may not use this information for any other
purpose and must maintain confidentiality of information.
Participation
Staff anticipates that 60 customers will participate in the Customer Incentive Program and
receive $345,000 in rebates (50% lighting — 50% other end uses). The $30,000 allocated for
feasibility studies will allow an estimated 4 - 8 customers to benefit from this aspect of the
Program. See Attachment E for a sample of a customer incentive application.
V. PROGRAM COSTS AND BENEFITS
Non —Lighting Program Costs
Design Assistance $ 30,000
Customer Rebates: $130,000
Advertising and Special Activities $ 12,500
Total $172,600
Lighting Program Costs
Rebates $150,000
Contract Labor $ 15,000
Program Cost $ 7,500
Total $172,600
TOTAL ANNUAL PROGRAM COSTS $345,000
Program Benefits
The Customer Incentive Program is an umbrella approach to energy efficiency. The customer
is rewarded for exercising innovation in his or her quest to achieve energy efficiency. The
customer now may qualify for a Department approved feasibility study and receive cash
incentives for energy measures implemented. A principal benefit of long-term energy
efficiency investment is reduced energy costs.
The community benefits to the extent that the load and energy usage is reduced and
conceivably, the environment is spared further pollution due to a decrease in generation
requirements, over time.
SUMMARY AND RECOMMENDATIONS
Recommendations
1. Emphasize implementation of specific measures within the spectrum of the Program,
specifically, motors, air compressors and injection molding machines. Identify and
target the market for these applications.
2. Design and implement a marketing plan to promote the program.
3. Authorize and fund the Customer Incentive Program for one full year term of the Public
Benefit Program, subject to continuation based on the success of the program.
Summary
The Customer 'Incentive Program provides a clear demonstration of the Department's
commitment to assisting customers achieve energy efficiency in their businesses. It rewards
those who search for and apply innovative energy efficient technologies, reduces the
Department's summer energy purchases and benefits society. The environmental benefit is
reduced carbon dioxide, which is the primary contributor to green house gases into the
atmosphere.
Furthermore, the Program supports the City's economic development efforts to attract and
retain business, thereby contributing to the growth and prosperity of the community.
ATTACHMENT A
Open Motors
Minimum Qualifying Efficiency
Hp 2 Pole 4 Pole 6 Pole 8 Pole
1.0
-
82.5
80.0
74.0
1.5
82.5
84.0
84.0
75.5
2.0
84.0
84.0
85.5
85.5
3.0
84.0
86.5
86.5
86.5
5.0
85.5
87.5
87.5
87.5
7.5
87.5
88.5
88.5
88.5
10.0
88.5
89.5
90.2
89.5
15.0
89.5
91.0
90.2
89.5
20.0
90.2
91.0.
91.0
90.2
25.0
91.0
91.7
91.7
90.2
30.0
91.0
92.4
92.4
91.0
40.0
91.7
93.0
93.0
91.0
50.0
92.4
93.0
93.0
91.7
60.0
93.0
93.6
93.6
92.4
75.0
93.0
94.1
93.6
93.6
100.0
93.0
94.1
94.1
93.6
125.0
93.6
94.5
94.1
93.6
150.0
93.6
95.0
94.5
93.6
200
94.5
95.0
94.5
93.6
250
94.5
95.4
95.4
94.5
300
95.0
95.4
95.4
350
95.0
95.4
95.4
400
95.4
95.4
450
95.8
95.8
500
95.8
95.8
Motor efficiencies stated
at 100% load
Rebates
based on motor size, type and efficiency.
Rebate is $150/kW of reduced load
above NEPA standards whether motor is new or a replacement.
ATTACHMENT B
ENCLOSED MOTORS
Minimum Qualifying Efficiency
Hp 2 Pole 4 Pole 6 Pole 8 Pole
1.0
75.5
82.5
80.0
74.0
1.5
82.5
84.0
85.5
77.0
2.0
84.0
84.0
86.5
82.5
3.0
85.5
87.5
87.5
84.0
5.0
87.5
87.5
87.5
85.5
7.5
86.5
89.5
89.5
85.5
10.0
89.5
89.5
89.5
88.5
15.0
90.2
91.0
90.2
88.5
20.0
90.2
91.0
90.2
90.2
25.0
91.0
92.4
91.7
89.5
30.0
91.0
92.4
. 91.7
91.0
40.0
91.7
93.0
93.0
91.0
50.0
92.4
93.0
93.0
91.7
60.0
93.0
93.6
93.6
91.7
75.0
93.0
94.1
93.6
93.0
100.0
93.6
94.5
94.1
93.0
125.0
94.5
94.5
94.1
93.0
150.0
94.5
95.0
95.0
93.6
200 95.05
95.0 95.0 94.1
250 95.4
95.0 95.0 94.5
300 95.4
95.4 95.0
350 95.4
95.4 95.0
400 95.4
95.4
450 95.4
95.4
500 95.4
95.8
Motor efficiencies stated
at 100% load
Rebates based on motor size, type and efficiency. Rebate is $150/kW of reduced load
above NEPA standards
whether motor is new or replacement.
ATTACHMENT C
AIR COMPRESSORS
TYPE SIZE EFFICIENCY REBATE
(ACFM/BHP)
Oil Flooded
Below 50 HP 3.6 $150
50 to 100 HP 4.2 $150
Above 100 HP 4.6 $150
Oil -Free
Below 50 HP
3.2
$150
50 to 100 HP
3.7
$150
Above 100 HP
4.1
$150
i
ATTACHMENT D
AIR CONDITIONER REPLACEMENT PROGRAM
Through the Wall Air Conditioner
Less than 66,000 Btu/hr
Efficiency Rating
Rebate
EER 8.7 and above
$ 75
Air -Cooled Central Package & Split System
Less than 66,000 Btu/hr
Efficiency Rating
Rebate
SEER 11 to 11.9
$ 75/ton
SEER 12 to 12.9
$100/ton
SEER 13 and above
$150/ton
65,000 Btu/hr to less than 135,000 Btu/hr
Efficiency Rating
Rebate
EER 9.2 to 9.4
$ 75/ton
EER 9.5 to 9.9
$100/ton
EER ' 10 and above
$150/ton
136,000 Btu/hr to less than 760,000 Btu/hr
Efficiency Rating
Rebate
EER 8.7 to 8.9
$ 75/ton
EER 9.0 to 9.5
$100/ton
EER 9.6 and above
$150/ton
760,000 Btu/hr and greater
Efficiency Rating
EER 8.4 to 8.6
EER 8.7 to 9.2
EER 9.3 and above
ATTACHMENT E
Coupon No.:
Issue Date:
Expiration Date:
Customer Name _
DBA Business Name:
Account Number:
Customer Contact:
Installation Address:
Rebate
$ 75/ton
$100/ton
$150/ton
Sample Customer Incentive Program Application
Federal Tax ID:
Rate Schedule:
Phone Number:
Vernon, CA 90058
CUSTOMERS MAILING ADDRESS FOR INCENTIVE CHECK
Name of Payee:
Address:
City: Vernon State: CA Zip Code: 90058
rRVJCV 1 UQ I MII-Q
MEASURE
kW Savings
kW Savings
Tons
SEER/EER
ESTIMATED
DESCRIPTION
REBATE
AMOUNT
Replace package AC
13.6
59,375
19
12
$3,266
Replace existing
54.0
236,250
180
$12,994
chiller with a new high
efficiency chiller
$1,795
Replace existing
7.5
32,638
cooling tower with high
efficiency cooling
tower
Upgrade tower with
9,791
$539
VSD
Install Primary-
54,831
$3,016
Secondary Pumping
Estimated Project Cost: Final Rebate Amount: Final Project Cost
ATTACHMENTS: Vernon Utilities Rebate Estimate and Final Rebate Analysis
AGREEMENT CLAUSE: I / We agree as follows: 1.) To begin the project within 90 days of initial registration and
finish within 180 days of project commencement; 2.) To allow Vernon Utilities to verify the sales transaction and
installation of the hardware specified in this project; 3.) To provide the original, itemized, paid `proof 'of purchase
(sales slip or invoice); 4.) This rebate is not to exceed thirty thousand dollars or thirty percent of the paid proof of
purchase (sales slip or invoice), whichever is less; 5.) Rebate will be calculated per the rebate schedule in effect at
the time of approval of this Coupon; 6.) Rebates are subject to availability of funds; 7.) That the City of Vernon may
withhold payment of any rebate until satisfaction of any and all of the above listed conditions are met; and 8.) To
maintain the kWh savings for a minimum of five years from date of the inspection.
Signature:
Printed Name:
Title:
Company:
Date Inspected: Inspector Name:
Total Rebate Amount: Measure Code:
Authorized Signature No. 1: Authorized Signature No. 2:
Check No.: Date Issued:
EXHIBIT B
I
Vernon Utilities Public Benefits Programs
Customer -Directed Program Proposal
Program Objectives:
1. Help business customers develop sound and effective energy projects for growing their
businesses through appropriate strategies and partnerships.
2. Increase the efficiency and productivity of energy use, while limiting environmental
impacts.
3. Support the development and demonstration of new energy technologies and products
for business opportunities.
4. Stimulate increased energy efficiency in buildings and operations.
5. Lead community efforts to develop innovative energy -related technologies and to
accelerate their acceptance and use at the community level.
6. Strengthen working relationships and networking among the businesses community in
Vernon and energy -related businesses.
Program Category Energy Efficiency; Research, Development, and Demonstration
Customer Class Commercial and Industrial
End -Use Technologies Product Development, Energy Efficient Technologies
Energy End Uses Energy efficient equipment
Start Date October 2000
Recommended Length One year
Of Program
Annual Program Cost $450,800
I. OBJECTIVES
This proposal outlines a program to provide funds for customer -directed projects involving the
use of energy efficient technologies and research, development, and demonstration (RD & D) of
energy -related technologies. The Vernon Utilities Department (Department) will solicit
proposals from commercial and industrial (Cl) customers for innovative projects. The following
are the objectives of the program:
• Help business customers develop sound and effective energy projects to grow their
businesses through appropriate strategies and partnerships;
• Increase the efficiency and productivity of energy use, while limiting environmental impacts;
• Support the development and demonstration of new energy technologies and products for
business opportunities;
• Stimulate increased energy efficiency in buildings and operations and the increased use of
alternative. energies;..
• Lead community efforts to develop and utilize efficient energy technologies and to
accelerate their acceptance and use at the community level;
• Strengthen working relationships and networking among the business community in Vernon
II. BACKGROUND
At its meeting on December 16, 1997, the City Council approved implementation of the public
benefits charge to fund public benefits programs, as mandated by Assembly Bill 1890.
Specifically, the public benefits charge is to fund programs in any of four areas: 1.) cost
effective energy efficiency; 2.) research, development, and demonstration; 3.) low-income
assistance, and 4.) renewable resource technologies. There are sufficient funds in the fiscal
year 2000-2001 budget to initiate the program.
The electric industry is expanding to include energy services, power marketing, and information
technology -based services and products, all of which are designed to provide greater customer
value. The new business environment suggests that successful distribution utilities know who
their customers are, what they need, and tailor services to match these customer needs.
Results of the Customer -Directed Energy Solutions Program will allow customers to further their
business goals and become more competitive in their industry. Through this program, the
Department will enhance customer communications, be able to offer more services, and
develop new information on customer priorities.
The menu of public benefits programs recommended by Vernon Utilities staff does not exhaust
all opportunities for energy efficiency measures, therefore, customized proposals from Vernon
customers are encouraged as a way of meeting specialized energy efficiency needs.
111111. PROGRAM DESCRIPTION
The Customer -Directed Energy Solutions Program will fund up to $75,000 for each project
selected that demonstrates energy -related and/or future commercial market potential in the area
of energy efficiency. The customer must provide at least twenty-five percent of the total project
cost. During the evaluation, projects will be weighed according to customer participation
funding levels. A total of $450,800 is allocated for the year. All Vernon commercial and
industrial customers are eligible to respond to the Department's request for proposals. Projects
may fall within one of the following two categories:
1. In-house Opportunities
In-house opportunities consist of installing or retrofitting companies' facilities with RD & D
technologies. Some examples may include photovoltaic systems, electric vehicle charging
systems, electrotechnologies, and energy efficient or new energy technologies that are applied
to facilities or processes.
2. Product Commercialization
Product commercialization consists of developing new technologies that will be used for
production and sale. These items will most likely fall in the RD & D category and must be
energy related. Products must be ready for testing or production in order to be considered for
funding. Some examples of past technologies that were developed for commercialization
include nickel -metal hydride batteries; aerosol duct sealer, which plugs air leaks in duct
systems; and compact fluorescent lights.
All expenses related to proposal preparation and submission and the oral presentation will be
the sole responsibility of the customer. Customers are allowed to submit one application per
year.
Timeline for Phase 1
• Formal program announcement — October, 2000
• Applications are accepted through November 13, 2000
• Evaluations completed — December 21, 2000
• City Council approval — January, 2001
• Awards announcement — January, 2001
Timeline for Phase 2
Awards approximately $276,000
Awards for approximately $275,000
• Applications accepted from February 1, 2001 through April 1, 2001
• Evaluations completed - May 15, 2001
• City Council approval - June 2001
• Awards announcement - June 2001
IV. PROGRAM IMPLEMENTATION
Program Delivery
Announcements of the Customer -Directed Program will be made at customer information
sessions. These meetings will target the senior management of businesses in Vernon.
Program informational material will be distributed at these meetings. Information will also be
disseminated through on -site energy audits, seminars, and conferences. Advertisements will be
displayed at the Vernon Chamber of Commerce, the Vernon Journal, and the web site.
Proposals will be accepted by fax at 323.583.1983, by postal mail addressed to: Eva De. La
Rosa, Energy Management Representative, Vernon Utilities; 4305 Santa Fe Avenue, Vernon,
CA 90058, or via e-mail at edelarosaCa dvernon.ca.us. Proposals submitted via e-mail must be in
Microsoft Word. Eva De La Rosa is the contact for all proposals, and she may be reached at
323.583.8811, extension 332. No proposals will be accepted after 5:00 PM on Monday,
November 13, 2000 for Phase 1 and Monday, April 2, 2001 for Phase 2.
Evaluation Criteria
The Customer -Directed Program proposals will be evaluated based on the following criteria:
• Concept description
• Electricity related innovation / projects tasks
• Energy savings
• Environmental impacts
• Economic competitiveness
• Commercialization / technology transfer
• Community benefits
After Department staff evaluates the proposals, finalists will be required to provide an oral
presentation to the Department's selection committee. Oral presentations will be evaluated on
the comprehensive knowledge and understanding of the types of technologies developed or
implemented. Research, barriers, and processes for technology development will be discussed.
Other project evaluation components will include: the business plan and budget; cost controls;
the probability of fulfillment of contract deliverables; corporate commitment and dedication to the
project; and schedule. Please review Exhibit "A", the project application.
In order to award a project, a Customer -Directed Energy Solutions Partnership Agreement will
be signed by the customer and the City. See Exhibit "B". Agreements over $25,000 will require
the approval of the City Council The agreements will specify a one-year time period for
development and implementation of the project. Payments to the customer will be made after
the agreed upon work is completed. The Director of Utilities may extend the term of the contract
by written notice to the customer within 30 days of the contract expiration date. If the customer
does not initiate the project within 60 days of the effective date of the agreement, the project will
be terminated.
V. PROGRAM COSTS AND BENEFITS
Program Costs
Incentives / Contract Services ................................................................$ 900,000
Advertising.. ................................................................................... $ 1 5,000
TOTAL PROGRAM BUDGET..................................................................... $ $ 05,000
9
Program Benefits
The priority of the program is to foster increased use of energy efficiency and facilitate the
adoption of new technologies.
The specific benefits to the Department will depend on the types of projects selected.
Electrotechnologies and electric vehicle projects will result in new electric load. Photovoltaic
projects are expected to increase supply of on -peak energy to the system. Research,
Development & Demonstration projects may result in efficient use of energy. The Department is
also expected to benefit from improved communications with business customers, new value
added services, and energy efficiency opportunities.
Customers can select projects that best meet their needs and concerns, therefore, adding value
to their company's operations. Customers' benefits will include financial assistance for new
technologies that may result in business expansion, improved energy efficiencies in operations,
and improved environmental applications.
VI. SUMMARY AND RECOMMENDATIONS
All commercial and industrial electric customers are eligible to submit applications for matching
funds for projects that qualify in the areas of energy efficiency and RD & D. The Department will
evaluate the projects and award a total of $450,800 during the first year for projects that best
meet the criteria. Customers will have a chance to submit applications twice during the year.
The projects will be awarded in two phases: the first awards will be announced January, 2001;
and the second awards will be announced in June 2001.
Through the Customer -Directed Energy Solutions program, the Department promotes customer
research of new technology development to help transform important markets while increasing
energy efficiency. In this way, Vernon Utilities leverages the benefits from the funds collected
through the AB 1890 mandated charge. The energy efficiency and RD & D projects that result
from the program will satisfy the requirements of AB 1890.
EXHIBIT "A"
CUSTOMER -DIRECTED ENERGY SOLUTIONS PROGRAM APPLICATION
The formal 2000-2001 competitive solicitation is available October, 2000. Applications are
accepted through November 13, 2000. Evaluation responses by the Vernon Utilities
Department will be completed by January, 2001.
Title of Project:
Company:
Address
Project Manager:
Title:
Phone:
Fax:
E-mail:
Project Manager:
Title:
Phone:
Fax:
E-mail:
Subcontractor(s) if applicable, including contact name, address, and phone number
Duration of Project:
Proposed Start Date:
Proposed Completion Date:
Amount of funds requested
,I;
Funding and Other Sources
List each amount from other grants or the proposing company, if applicable. Also, indicate
whether the contribution is in -kind or monetary.
$
P
Total Project Budget $
Please provide description in response to the following topics. Please be as specific as
possible. The length of the application should be no longer than six pages, including the cover
sheet. Attach additional pages as needed for subcontractor and other information pertinent to
the proposed project.
1.) Project Description Summary
Provide a summary description of the project, including general scope, location, and the expected end result of the
project.
2.) Project Objective(s)
List the goals and objectives of this project. What does it rix, what does it improve, what benefits are derived?
Include all economic, technical, energy, and environmental aspects.
3.) Scope of Work
Sufficiently detail the scope of work in chronological order.
4.) Perceived Risks
List all potential risks associated with implementing the project.
6.) Financial Analysis
Provide costs for implementation of the project. Sufficiently itemize all labor, material, operational processes, and all
associated project costs. Indicate the basis for these costs or provide sufficient back up, such as contractor bids and
vendor proposals. Also, summarize the total financial benefits that result from the project.
6.) Tasks Time Schedule
Provide a project schedule. Show all project milestones and expected completion date(s).
7.) Approval Process
Describe your company's internal approval process for this project. Indicate if this project has been discussed and
has received authorized approval.
8.) Energy Savings Calculations
Provide calculations for energy and energy cost savings. Provide a summary of all key assumptions and inputs.
Provide sufficient detail for review.
9.) Measurement and Verification
Provide an evaluation criteria and methodology to which the project's effectiveness can be measured. (Projects the
replace or modify lighting or HVAC energy consuming systems may follow the procedures outlined in the International
Performance, Measurement, and Verification Protocol published by the Department of Energy.)
10.) Project Type
Please answer one of the appropriate questions below based on whether your project is for your own facility or for
product development and commercialization.
a.) In -House Opportunities Projects
How will the project benefit your organization and the community?
b.) Product Commercialization Projects
Have you conducted a literature or product search to determine if information resulting from a similar project already
exists? If so, describe any similar projects. Please explain how this proposed project would be different from the one
identified in the search.
11.) Project Stage
At what stage of development is the project? Please check one of the stages below.
Projects must be in Stage 3, 4, or 5 to be considered for funding. Please check off the
appropriate stage of the proposed project:
Stage 1: Conceptual
The objective is to demonstrate through tests or analyses the performance and the
implementation potential of a concept.
Stage 2: Technical Feasibility
The objective is to confirm the performance of the new product by experimenting or preparing
engineering analyses. This stage validates that there are no technical or economical barriers
for implementation.
Stage 3: Development
The objective is to make improvements on the materials, designs, and processes of the product,
as well as to confirm that the product will perform as specified. This stage entails the
construction of testing prototypes.
Stage 4: Commercial Validation or Demonstration
The objective is to develop manufacturing techniques and the introduction of a new process in a
system.
Stage 5: Full Scale Production and Deployment
The objective is to build the manufacturing or process facility and to make full-scale production
runs.
12.) Attachments
Provide all additional documents such as plans and process diagrams that support the project application. Please do
not attach originals, as the attachments will not be returned to applicants. Upon approval, the City of Vernon will
provide you with a Customer -Directed contract that will specify the terms and conditions for project acceptance and
the total funding allotted for this project.
c:\mydoucments\abl890customerdirected-doc
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
AGREEMENT BY AND BETWEEN
THE CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
TABLE OF CONTENTS
PREAMBLE...................................................................................................._................1
RECITALS.....................
.......................................................................................:..........1
AGREEMENTPROVISIONS
...........................................................................................3
1.0 PROJECT DESCRIPTION.....................................................................................
3
2.0 COMMENCEMENT OF PROJECT.......................................................................3
3.0 REPORTING REQUIREMENTS...........................................................................3
4.0 MEASUREMENT AND VERIFICATION................................................................4
5.0 SITE INSPECTION REQUIREMENTS. ..................... .....•.........•••••
..................••••4
6.0 ADDITIONAL PROJECT REQUIREMENTS.........................................................4
7.0 DISBURSEMENT OF BENEFITS. ........................... ..........................................•••4
8.0 DISBURSEMENT DISQUALIFICATION...............................................................4
9.0 TERM OF AGREEMENT......................................................................................5
10.0 DEFAULT OF CUSTOMER/TERMINATION.......................................................5
11.0 LIABILITY AND DAMAGES................................................................................6
12.0 ASSIGNMENTS AND SUCCESSORS IN INTEREST........................................7
13.0 REVIEW AND DISCLAIMER..............................................................................7
14.0 CUSTOMER IS AN INDEPENDENT CONTRACTOR........................................7
15.0 RIGHT OF THE CITY OF VERNON TO INSPECT RECORDS OF CUSTOMER.
.............................................................................................................
16.0 RECORDS, REPORTS AND DOCUMENTATION ..............................................8
17.0 MONITORING AND EVALUATION....................................................................
8
18.0 FAIR EMPLOYMENT............................:.............................................................9
19.0 HOLD HARMLESS/INDEMNIFICATION.............................................................9
20.0 FORCE MAJEURE.............................................................................................9
21.0 REQUIRED LICENSES OR PERMITS.............................................................
22.0 AMENDMENTS................................................................................................
10
23.0 INSURANCE REQUIREMENTS. .............................. . .......................................10
24.0 INTEGRATED DOCUMENT - TOTALITY OF AGREEMENT ............................10
25.0 NO THIRD PARTY BENEFICIARY...................................................................10
26.0 NOTICES....................... ...................................................................................11
27.0 CAPTIONS ...................................................................:...11.
28.0 STATUTES AND LAW GOVERNING CONTRACT..........................................11
29.0 VENUE....................................11
................................................
.......................................
30.0 OTHER AGREEMENTS...................................................................................11
31.0 DISPUTE RESOLUTION..................................................................................11
EXHIBIT A: DETAILED APPLICATION AND PROJECT DESCRIPTION
.....................14
EXHIBIT B: MEASUREMENT AND VERIFICATION PLAN......._.................................15
EXHIBIT C: DISTRIBUTION OF BENEFITS................................................................16
EXHIBIT D: CONFIDENTIAL INFORMATION -ELIGIBLE AMOUNT .............................17
EXHIBIT E: ADDITIONAL PROJECT REQUIREMENTS.............................................18
EXHIBIT F: STANDARD INSURANCE REQUIREMENTS............................................19
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE
AGREEMENT BY AND BETWEEN
THE. CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
PREAMBLE
This Customer Directed Contract ("CDC") for the use of Public Benefit Funds (as
set forth in Exhibit A, attached and incorporated by this reference.) collected by the City
of Vernon pursuant to City Council Resolution No. 7062 is made and entered into on
this day of , 2000, ("Effective Date") by and between <Customer
Name> , a Corporation ("Customer") and City of Vernon, California. The City
of Vernon and Customer may be referred to herein individually as a "Party" or
collectively as the "Parties" or the "Parties to this Agreement."
RECITALS
WHEREAS:
A. Pursuant to Resolution No. 7062 adopted on December 16, 1997 by the
City Council of the City of Vernon, the City of Vernon collects monies from
customers for the purpose of administering a Public Benefits Program for
the purpose of promoting programs in the four categories delineated by
Public Utilities Code section 385:
1. Cost effective demand side management services to
promote energy efficiency and energy conservation;
2. New investment in renewable energy resources and
technologies consistent with existing statutes and
regulations which promote those resources and
technologies;
3. Research, development and demonstration programs for the
public interest to advance science or technology which is not
adequately provided by competitive and regulated markets;
and
4. Services provided for low-income electricity customers,
including but not limited to, targeted energy efficiency
services and rate discounts.
B. -On or about August 2000, the City Council of City of Vernon adopted The
Customer Directed Program whereby customers of City of Vernon may
plan, develop and direct their own use of Public Benefit Funds for energy
related projects qualifying under the Customer Directed Program ("CD
Program");
C. Customer has made an Application for use of Public Benefit Funds to the
City of Vernon and the City of Vernon has determined that the project
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
proposed in that Application by Customer does qualify under the CD
Program.
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AGREEMENT PROVISIONS
In consideration of the above referenced recitals and the following mutual covenants,
commitments, and obligations of the Parties, the Customer and the City of Vernon
agree as follows:
1.0 PROJECT DESCRIPTION.
Customer has prepared, and the City of Vernon has approved,.a Detailed
Application for the Project which is the subject of this CDC. The complete
Detailed Application as set forth in Exhibit "A", attached and incorporated by this
reference, and constitutes the description of the project that is the subject of this
CDC ("Project"). The scope of the Project shall not be amended, extended or
changed unless otherwise provided herein.
2.0 COMMENCEMENT OF PROJECT.
Customer shall commence Work on the Project no later than 30 days from the
Effective Date of this CDC, and shall exercise reasonable commercial efforts to
demonstrate diligent progress thereafter. Failure of Customer to timely
commence and pursue the Project shall be grounds for termination of this CDC
such that the funds may be re -directed for use -by another CD Program.
3.0 REPORTING REQUIREMENTS.
3.1 A Project Status Report[s] may be required by The City of Vernon, as
specifically set forth in the- Additional Project Requirements as set forth in
Exhibit "E", attached and incorporated by this reference. The City of
Vernon may require Status Report[s] even if not set forth. in Exhibit E with
reasonable notice to Customer, however, not more frequently -than once
a quarter.
3.2 Measurement and Verification Reports ("M&V Report") may be required
by The City of Vernon as specifically set forth in the Measurement &
Verification Plan (M&V Plan) approved by The City of Vernon and as set
forth in Exhibit "B", attached and incorporated by this reference. If an
M&V Plan is not required at the inception of the Project, but it is later
determined by the City of Vernon that M&V is necessary, then Customer,
upon reasonable notice, will prepare and provide an M&V Plan to the City
of Vernon for approval. In general, pursuant to an M&V Plan, The City of
Vernon may require one or more M&V Report[s] for a Project, but not
more frequently than once a month. M&V Reports document the results
of the Customer's Measurement & Verification ("M&V") activities that have
occurred in accordance with the M&V Plan approved by the City. of
Vernon.
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4.0 MEASUREMENT AND VERIFICATION.
M&V may be required by the City of Vernon, and if so required, is included in the
M&V Plan approved by the City of Vernon and attached as Exhibit B. All M&V
performed by the Customer shall be conducted in accordance with the Project -
specific M&V Plan approved by The City of Vernon. If the M&V procedures
contained in the M&V Plan approved by The City of Vernon materially fail to result
in the anticipated measurement and verification, then the Parties agree that the
M&V Plan shall be amended so as to provide proper measurement and
verification. If an M&V Plan is not required at the inception of the Project, but it is
later determined by the City of Vernon that M&V is necessary, then Customer,
upon reasonable notice, will prepare and provide a M&V Plan to the City of Vernon
for approval.
5.0 SITE INSPECTION REQUIREMENTS.
The City of Vernon may require inspections of the Customer's Project site, but not
more frequently than once per month, and Customer agrees to allow the City of
Vernon timely access to the Project site, sufficient to determine that the Project is
proceeding in accordance with this CDC. The City of Vernon will provide
Customer twenty four (24) hours notice before any such inspection and will comply
with any safety requirements of Customer.
6.0 ADDITIONAL PROJECT REQUIREMENTS.
Additional Project Requirements, to the extent they exist, are set forth in Exhibit
"Egg.
7.0 DISBURSEMENT OF BENEFITS.
Disbursement of Benefits shall be as set forth in Exhibit "C", attached and
incorporated by reference, and in accordance with this CDC.
8.0 DISBURSEMENT DISQUALIFICATION.
8.1 Customer is eligible to receive no greater than the amount equal to
If the Customer fails to pay the
Public Benefits Charge throughout the term of the CDC up to and
including December, 2001, then all or some of the Eligible Amount shall
be disgorged and re -paid to the City of Vernon. To the extent that
Customer does not meet the requirements of the M&V Plan in all material
respects during the payment of the Public Benefits Charge by Customer,
the Eligibility Amount that must be disgorged and re -paid to the City of
Vernon shall be pro -rated.
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8.2 Customer shall re -pay any overpayments made by the City of Vernon
based on estimates of the Eligible Amount, within thirty-five (35) days of
notification by the City of Vernon. The City of Vernon will be entitled to
offset against disbursements owed to the Customer which remain unpaid
forty (40) calendar days after the City of Vernon's written demand for re-
payment. To the extent Customers eligibility amount increases due to
increased energy usage, Customer shall be entitled to receive those
funds upon presentation of qualifying documents and subject to
availability of funds.
9.0 TERM OF AGREEMENT.
Unless otherwise set forth in this CDC or unless this paragraph is subsequently
modified by a written amendment to this CDC, the term of this CDC shall be from
the Effective Date. Customer may terminate this CDC for convenience at any time
up to and including completion of the Project. If the Project is not completed, and
as a consequence, no part of the Project is functional such that no energy
efficiency is achieved, then Customer will not be entitled to reimbursement for any
expenditures made on the Project. If the Project is not completed, but a
percentage of the Project is functional and does achieve the anticipated energy
efficiency results (such as some, but not all of a lighting retrofit Project being
completed) then Customer shall be entitled to reimbursement for those expenses
paid, installed and actually functional, in accordance with the disbursement
procedures of this CDC. Customer may not terminate this. CDC merely to avoid
M&V Reporting requirements after the Project is complete and Customer has
received reimbursement.
10.0 DEFAULT OF CUSTOMER/TERMINATION.
Any breach of a material term of this CDC shall constitute a default, and include,
but are not limited to:
10.1 Failure to abide by any of the material terms of this CDC, following notice
by the City of Vernon and a ninety (90) day period in which to cure such
non-compliance, including but not limited to, failure to meet Measurement
.and Verification requirements, failure to meet reporting requirements, or
failure to meet Additional Project Requirements;
10.2 Failure to provide the City of Vernon or its consultants sufficient access to
the Customer Site for inspection and/or observation of the Customer's
field M&V_activities following reasonable notice to Customer;
10.3 Material deviation from the agreed upon Project description;
10.4 Failure of Customer to timely perform its material responsibilities under
this CDC, including but not limited to, failure to commence the Project on
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT. EXAMPLE DRAFT
time, failure to use commercially reasonable efforts to diligently pursue
the Project, failure to timely provide any reports, M&V or site inspections;
10.5 Misuse of funds, submission of false records for reimbursement and the
like;
10.6 Failure to cure any deficiency in a material term or cure any material
breach of this CDC within ninety (90) calendar days after written notice;
10.7 Failure to maintain or obtain necessary permits, licenses or insurance
required by the Project proposed pursuant to this CDC;
10.8 Assignment of all or part of the benefits or duties required under this CDC
without the City of Vernon's prior written permission; and
10.9 If either Party to this CDC engages in any of the foregoing actions or
inactions or otherwise violates any of the terms of this CDC, the non -
defaulting Party may, by notice to the defaulting Party, specify the nature
of such default, and declare this CDC to be in default. The defaulting
Party must remedy the default within the time specified in this CDC, or, if
no time is specified, within ninety (90) days after receiving written notice
from the non -defaulting Party.
11.0 LIABILITY AND DAMAGES
11.1 If the defaulting Party is Customer and Customer fails to cure its default
within the 90 day period set forth in Paragraph 10.1, the City of Vernon
may, at any time thereafter, exercise, at- its election, any rights or
remedies it may have under this CDC, at law or in equity, to enforce the
terms thereof, including, but not limited to, injunctive relief, specific
performance, termination of this CDC or (if there has been a; misuse of
Public Benefit Funds by Customer) repayment to the City of Vernon by
Customer of any disbursements made pursuant to this CDC. If the
defaulting Party is the City of Vernon, and the City of Vernon fails to cure
its default within such period of time, Customer may, at any time
thereafter, exercise, at its election, any rights or remedies it may have
under this CDC, at law or in equity, to enforce the terms thereof, including,
but not. limited to, injunctive relief, specific performance or termination of
this CDC. If the event of default has not been cured as provided above,
the non -defaulting Party may, at its option, terminate this CDC, effective
on written notice, without liability of any description, kind or nature,
whatsoever, to the defaulting Party.
11.2 Neither Party shall be liable for any direct
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
failure of the Project to be completed by a certain date. Customer hereby
acknowledges pursuant to paragraph 13.0 below and this paragraph that
the Project is of Customer's design, not the City of Vernon's, and that
approval of the Preliminary Application, Detailed Application,
Measurement & Verification Plan or any site inspections or acceptance of
Status Reports does not constitute any form of representation by The
City of Vernon as to the success of the Project.
12.0 ASSIGNMENTS AND SUCCESSORS IN INTEREST.
Except as otherwise set forth in this CDC, no interest in this CDC or any of the .
Work to be performed under this CDC or as a part of the Project, shall be
assigned or transferred, either voluntarily or by operation of law, without the prior
written approval of the City of Vernon, which approval shall not be unreasonably
withheld or delayed. However, claims for money due to or to become due to
Customer from the City of Vernon under this CDC may be assigned to a bank,
trust company, or other financial institutions, or to a trustee in bankruptcy provided
that written notice of any such assignment or transfer shall be first furnished to the
City of Vernon. The City of Vernon shall not voluntarily assign or transfer any
interest in this CDC without the prior written consent of Customer.
13.0 REVIEW AND DISCLAIMER.
The City of Vernon's review and/or approval of the Detailed Application, Project,
design, construction, operation, maintenance or any other aspect of the proposed
Project shall not constitute any representation as to the economic or technical
feasibility, operational capability, or reliability of the Project. The Customer shall in
no way represent to any third party that the City .of Vernon's review and/or
approval of the Project, including but not limited to the City of Vernon's review of
the Detailed Application, Project design, construction, operation, maintenance or
any other aspect of the proposed Project, is a representation by The City of
Vernon as to the economic or technical feasibility, operational capability, or
reliability of the Project. The Customer is solely responsible for the economic or
technical feasibility, operational capability, or reliability of the Project.
14.0 CUSTOMER IS AN INDEPENDENT CONTRACTOR.
Customer agrees that in performing the work required under this Agreement, it is
not an agent or employee of The City of Vernon but an independent contractor for
professional services with full rights to manage its employees subject to the
requirements of the law. All persons employed by or contracted with Customer to
furnish labor and/or materials in connection with the work under this Agreement
are not employees of the City of Vernon in any respect.
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15.0 RIGHT OF THE CITY OF VERNON TO INSPECT RECORDS OF CUSTOMER.
The City of Vernon, through its authorized employees, representatives, or agents,
shall have the right during the term of this CDC, and for three (3) years from the
date of the final disbursement under this CDC, to audit the applicable and relevant
books and records of Customer for the purpose of verifying any and all charges
made by Customer in connection with Customer reimbursement under this CDC.
Such audits may be conducted no more frequently than once per calendar year,
shall be at the expense of the City of Vernon and shall be with reasonable
advance notice. Customer agrees to maintain sufficient books and records in
accordance with generally accepted accounting principles to establish the
correctness of all charges submitted to the City of Vernon. Any expenses not so
recorded shall be disallowed by The City of Vernon.
16.0 RECORDS, REPORTS AND DOCUMENTATION.
Customer shall maintain complete and accurate records of its operations as they
relate to the Project, including any and all additional written records required by
the City of Vernon pursuant to this CDC. Customer shall submit to the City of
Vernon any and all reports required pursuant to this CDC, or any other reasonable
reports concerning its performance under this CDC that may be requested by the
City of Vernon, in writing. Customer agrees to cooperate with the City of Vernon
in meeting the City of Vernon's 'reporting requirements to the State and other
agencies with respect to Customer's Project hereunder. All records, reports, and
documentation relating to the work performed under this CDC shall be made
available to the City of Vernon during the term of this CDC. Unless otherwise
provided in this CDC, any audit of such materials may be conducted no more
frequently than once per calendar year.
17.0 MONITORING AND EVALUATION.
The City of Vernon may monitor the work performed under this CDC to determine
whether Customer's operation conforms to the City of Vernon's CD Program and
to the terms of this CDC. The City of Vernon may monitor the work required to be
performed herein to determine whether financial operations are conducted in
accord with applicable City of Vernon, county, state, and federal requirements. If,
in the course of monitoring and evaluation, The City of Vernon believes it has
discovered any practice, actions, procedure, or policy of Customer which
materiallydeviatesfrom the terms of this CDC or the CD Program, the City of
Vernon may notify Customer in writing and Customer agrees to respond in writing
to the City of Vernon in writing within fifteen (15) days regarding such action,
procedure, or policy,, and cure the same consistent with Paragraph 10.1.
EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
18.0 FAIR EMPLOYMENT.
Customer shall not discriminate against any employee or applicant for
employment because of race, color, creed, national origin, sex, age, condition of
physical handicap, religion, ethnic background, or martial status, in violation of
state or federal law.
19.0 HOLD HARMLESS/INDEMNIFICATION.
To the extent permitted by law, Customer agrees to protect, defend, hold
harmless and indemnify the City of Vernon, its City Council, commissions, officers,
employees, volunteers, and agents from and against any claim, injury, liability,
loss, cost, and/or expense or damage, however same may be caused, including
all costs and reasonable attorney's fees in providing a defense to any claim arising
from this Project, for which Customer shall become legally liable arising from
Customer's acts, errors, or omissions with respect to or in any way connected with
the prosecution of the work performed by Customer pursuant to this CDC. Unless
any such claim arises out of the City of Vernon's acts, errors or omissions, but not
by way of limitation, Customer specifically agrees to defend and indemnify the
City of Vernon against any and all claims brought by any contractor or
subcontractor acting on behalf of Customer with regard to the Project.
20.0 FORCE MAJEURE.
Neither Party shall be considered to be in default in performance of any of its
obligations under this CDC when a failure of performance is due to an
uncontrollable force. The term "Uncontrollable Force" as used in this Agreement,
shall mean any cause beyond the control of the Party affected, and which by
exercise of reasonable due diligence such Party could not reasonably have been
expected to avoid and which by exercise of due diligence it has been unable to
overcome or obtain or cause to be obtained a commercially reasonable substitute
therefor. Such Uncontrollable Force includes the failure of or threat of failure of
facilities, Act of God, flood, drought, earthquake, storm, tornado, fire; explosion,
lightening, epidemic, public emergency, war, riot, civil disobedience, labor strike,
labor dispute, labor or materials shortage (however labor or materials ,shortage
does not include the mere inability to obtain that labor or material at a particular
price), sabotage; restraint by court order, restraint by public authority, or action or
non -action by governmental authority or accident. No Party shall, however, be
relieved of liability for failure of performance if such failure is due to causes arising
out of its own negligence or due to the removable of remediable causes which it
fails to take reasonable_ efforts to remove or remedy ,within a reasonable time, or
due to mere fluctuations in market prices. Nothing contained herein shall be
construed to require a Party to settle any strike or labor dispute in which it may be
involved. Either Party rendered unable to fulfill any of its obligations under this
CDC by reason of an Uncontrollable Force shall give prompt written notice of such
fact to the other Party and shall exercise due diligence to remove such inability
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with all reasonable dispatch.
21.0 REQUIRED LICENSES OR PERMITS.
Customer guarantees that it will obtain and, upon Project commencement, will
continue to maintain, all licenses or permits required by State, Federal and local
governments and regulatory agencies for the Project to be performed by
Customer under this CDC.
22.0 AMENDMENTS.
It is mutually understood and agreed that no alteration or variation of the terms of
this CDC shall be valid unless made in writing and signed by the Parties and
incorporated into this CDC.
23.0 INSURANCE REQUIREMENTS.
During the term of this CDC, and for any required time thereafter as set forth
below, Customer and its contractors or subcontractors shall maintain in full force
and effect, at no cost to City, the following insurance policies:
a. commercial general liability policy (bodily injury and property damage);
b. worker's compensation employer's liability policy; and,
C. comprehensive automobile liability insurance policy.
Said policies shall be maintained with respect to employees and vehicles assigned
to the performance of work under this CDC with coverage amounts and including
the required endorsements, certificates of insurance, and coverage verifications
as defined as set forth in Exhibit "F", attached and incorporated by this reference.
24.0 INTEGRATED DOCUMENT - TOTALITY OF AGREEMENT.
This CDC and its Exhibits embody the agreement between the City of Vernon and
Customer with respect to the Project described herein and its terms and
conditions. No other understanding, agreements, or conversations, or otherwise,
with any officer, agent, or employee of the City of Vernon prior to execution of this
CDC shall -affect or modify any of the terms or obligations contained in any
documents comprising this CDC. Any such verbal agreement shall be considered
as unofficial information and in no way binding upon the City of Vernon..
25.0 NO THIRD PARTY BENEFICIARY.
This CDC shall not be construed or deemed to be an agreement for the benefit of
any third party or parties, and no third party or parties shall have any claim or right
of action under this CDC for any cause whatsoever.
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26.0 NOTICES.
All notices to the Parties shall, unless otherwise requested in writing, be sent to
The City of Vernon addressed as follows:
City of Vernon
Utilities Department
4305 Santa Fe Avenue
Vernon, California
or by facsimile at
323.583.1983
And to Customer addressed as follows:
<Customer Name>
Attn:
Vernon, CA 90058
27.0 CAPTIONS.
The captions of the various sections, paragraphs and subparagraphs are for
convenience only and shall not be considered or referred to in resolving questions
of interpretation.
28.0 STATUTES AND LAW GOVERNING CONTRACT.
- This Agreement shall be governed and construed in accordance with the statutes
and laws of the State of California.
29.0 VENUE.
This CDC is entered into in Vernon, California. In the event that suit shall be
brought by either Party to this CDC, the parties submit themselves to the
jurisdiction of the courts of the State of California.
30.0 OTHER AGREEMENTS.
This CDC shall not prevent either Party from entering into similar agreements with
others.
31.0 DISPUTE RESOLUTION.
31.1 Unless otherwise mutually agreed to, any controversies between
Consultant and the City of Vernon regarding the construction or
application of this Agreement, and claims arising out of this Agreement or
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its breach, shall be submitted to mediation within thirty (30) days, of the
written request of one Party after the service of that request on the other
Party.
31.2 The Parties may agree on one mediator. If they cannot agree on one
mediator, the Party demanding mediation shall request the Superior Court
of to appoint a mediator. The mediation meeting shall not
exceed one day (eight (8) hours). The Parties may agree to extend the
time allowed for mediation under this Agreement.
31.3 The costs of mediation shall be borne by. the Parties equally.
31.4 Mediation under this section is a condition precedent to filing an action in
any court. In the event of litigation which arises out of any dispute related
to this Agreement, the Parties shall each pay their respective attorneys
fees, expert witness costs and cost of suit, regardless of the outcome of
the litigation.
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The Parties acknowledge and accept the terms and conditions of this Agreement
as evidenced by the following signatures of their duly authorized representatives. It is
the intent of the Parties that this Agreement shall become operative on the Effective
Date.
Approved as to form:
Eduardo Olivo
City Attorney
Attest:
Gloria Orosco
Chief Deputy City Clerk
<CUSTOMER NAME>
The City of Vernon, California,
Bruce V. Malkenhorst
City Administrator
Vernon, CA
Telephone:
Fax:
By:
(Signature)
<Name>
<Title>
<Address>
Vernon, CA
Phone:
Fax:
"Customer'
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AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT A: DETAILED APPLICATION AND PROJECT DESCRIPTION
Attached hereto is Customer's Detailed Application which contains ` the
description of the Project that is the subject of this CDC.
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AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT B: MEASUREMENT AND VERIFICATION PLAN
Attached hereto to this Exhibit "B" is the. Measurement & Verification Plan. approved by
the City of Vernon.
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AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTO.MER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT C: DISTRIBUTION OF BENEFITS
<Customer Name> will receive no more than $XXX,XXX of funds for this program to be
distributed no more than 30 days upon the City of Vernon's verification of completion of
the Project.
The above stated funding may be reduced if the project's actual costs are less than the
estimated costs indicated in the detailed project application.
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AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT D: CONFIDENTIAL INFORMATION - ELIGIBLE AMOUNT
• • I a
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AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT E: ' ADDITIONAL PROJECT REQUIREMENTS
The City of Vernon or any agent of the City of Vernon may inspect and verify installation
of Project as described in Exhibit A prior to the disbursement of Public Benefit Funds.
• EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT EXAMPLE DRAFT
AGREEMENT BY AND BETWEEN
CITY OF VERNON, CALIFORNIA
AND
<CUSTOMER NAME>
FOR CUSTOMER DIRECTED FUNDING
EXHIBIT F: STANDARD INSURANCE REQUIREMENTS
Customer, at its sole cost and expense, shall purchase and maintain the insurance
policies set forth below on all of its operations under this Agreement.
c:\mydocuments\customerdirectedruies
SUPPORTING
DOCUMENTS
September 6, 2000
TO: Bruce V. Malkenhorst, City Administrator
FROM: Kenneth J. DeDario, Director of Utilities Y V--
SUBJECT: Public Benefits Programs
On March 21, 2000 Council approved and adopted the City of Vernon Utilities Department
Public Benefits Programs. This document is a generic description of five programs that are all in
the area of energy efficiency and are funded by the Public Benefits Charge collected directly
from the customers. At that time two of the five programs were ready for implementation and
were also approved, the Energy Audits and Energy Education And Demonstration Workshops
Programs, respectively.
Two additional programs are now ready for implementation. Therefore, I recommend approval
of the attached Customer Incentive and Customer Directed Programs, respectively.
If you have any questions or comments, please contact me. Thank you for your consideration.
KJD:dm
Attachments
Vernon Utilities Public Benefits Programs
Customer Incentive Program Proposal
Program Objectives:
• Promote long-term energy efficiency by encouraging commercial and industrial customers
to implement energy efficiency measures that exceed minimum standards;
• Provide incentives that encourage customers to investigate and apply the latest energy
efficient technology;
• Promote economic development and business retention by attracting and retaining
customers who will enjoy the benefits of energy efficiency.
• Encourage customer investigation of efficiency opportunities
• Improve competitiveness of Vernon businesses
• Increase customer awareness of efficient practices (including O & M)
Customer Class:
Energy End -Use Technologies:
Energy End Uses:
Start Date:
Length of Program:
Commercial and Industrial
High efficiency lighting, motors, controls, energy
management systems.
Lighting, air compressors, production equipment, HVAC.
October, 2000
One year pilot --continuity subject to customer
participation
Annual Program Cost: $345,000 (50% lighting, 50% other)
A
CITY COUNCIL
LEONIS C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. 'BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL MCCORMICK
Councilman
BRUCE V. MALKENHORST
City Administrator / City Clerk
FAX (323) 581-7924
City Council
City of Vernon
Honorable Members:
RD OLIVO
C' ttorney
: (562) 927-8722
KEVIN WILSON
Director of Community Services & Water
FAX: (323) 588-2761
CITY HALL
4305 SANTA FE AVENUE, VERNON, CALIFORNIA 90058
TELEPHONE (323) 583-8811
September 14, 2000
KENNETH J. DeDARIO
Director of Municipal Utilities
FAX: (323) 583-1983
DAVE TELFORD
Fire Chief
FAX: (323) 581-1385
BRUCE W. OLSON
Police Chief
FAX: (323) 583-5236
On March 21, 2000 City Council approved and adopted the City of Vernon
Utilities Department Public Benefits Programs that included five
programs in the area of energy efficiency and that are being funded by
the Public Benefits Charge collected directly from the customers. Two
of the five programs were approved for implementation at the time.
Two additional programs, the Customer Incentive and Customer Directed
programs are ready for implementation and it is hereby recommended
that approval be granted to introduce these programs to our customers.
Very truly yours,
Bruce V. Malkenhorst
City Clerk
BVM/ng