Joint Procurement Strategies for Prop 39: Using Economies of Scale to Get Best Pricing

October 6, 2015

TerraVerde Overview

Expertise:

Selected by 35 Districts to support Prop 39 implementation; 20 Expenditure Plans approved by CEC; 15 in RFP, design or construction phase

Track Record:

Over $100 Million in Solar projects completed at 120 sites to date; another 20 sites under construction Fall 2015, and 44 more projects starting between January 2015 and June 2016

100% on time, on budget and performing as promised; $10 Million+ in cost savings

helped secure over $35 Million in low-interest financing for solar and energy efficiency projects(CEC Loans, Build America Bonds, QSCBs, CREBs)

Innovation:

Completed first solar plus battery storage School District project in California (9 sites); another under construction (8 sites) and several more in RFP phase

Recognized Leader:

CASBO’s only Energy Strategic Alliance Partner

SEC Executive Committee Member

Selected by CEC to help develop Solar Calculators

Expert Witness in Solar Policy proceedings before the CPUC

Independence

Since 2009, TerraVerde has been California’s only independent solar energy advisor; no ties whatsoever with contractors, suppliers or financiers

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Prop 39 Procurement Requirements

Public Resources Code section 26235(c), states, “A community college district or LEA shall not use a sole source process to award funds pursuant to this chapter. A community college district or LEA may use the best value criteria…”

“The LEA shall defer to their own procurement regulations and procedures, as long as they reflect applicable state and local laws and regulations and do not conflict with the minimum legal standards specified above.”

PROPOSITION 39: California Clean Energy Jobs Act –2015 ENERGY EXPENDITURE PLAN HANDBOOK

In other words…Consult your attorney

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Energy Project Development and OperationBest Practice Basics

“Measure Twice, Cut Once”

One size does not fit all…

Make sure you get an unbiased evaluation of the optimal project specifications

Make the market compete for your business

Use an RFP procurement process that specifies performance

Use competition to your advantage in contract negotiations

Leave Nothing to Chance

Drill down into the numbers

Make sure you understand all contract terms

Have someone who understands energy projects manage your construction and commissioning

Monitor Performance and Warranties

Quarterly and annual reporting

24/7 Monitoring by someone who is working for you

Preventive maintenance and warranty enforcement

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Joint Procurement: Case Study #1

Multi-District Energy Conservation General Contractor RFP

5 Districts

Allocations ranging from $250K to $500K…totaling $1.7 Million

4 located within 30 miles of each other; one 60 miles away

Common project scope: HVAC, Interior/Exterior Lighting, Controls

Process to date

Current Status

What worked, What didn’t

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Joint Procurement: Case Study #2 Solar Project

3 Districts:

One: 10,000+ ADA

Two: > 1,000 ADA, one site each

All located within 30 miles of each other

Different Project Scope

One: multiple sites; Two: one site

One: Mix of shade structures and Groundmount; Two: Groundmount only

One: No Prop 39 funds; Two: Using Prop 39

One: PPA only; One CREB financing plus Prop 39; One PPA plus Prop 39

Process to Date

Current Status

What worked, What didn’t

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Solar Results: Large District

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Solar Results: Small District

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Lessons Learned

Educate bid community

Reduce complexity…KIS

Make risks transparent

Keep open to the unexpected

Use trusted partners

Joint Procurement is not always the best way

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Contact Information

Rick Brown, PhD, President

TerraVerde Renewable Partners, LLC1100 Larkspur Landing, Suite 155

Larkspur, CA 94939(707) 953-2885

Rick.Brown@tvrpllc.comwww.TVRPLLC.com

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About TerraVerde Renewable Partners

Since 2009, TerraVerde has been California’s leading independent solar energy advisor

Recognized leader in project development consulting services: Energy Efficiency, Solar PV, Energy Storage

In house engineering, structured finance, financial modeling, Installation & PPA contracts, Owner’s Representative project management, and post-installation Asset Management Services

Serving all of California (offices in So Cal & Nor Cal)

Solar energy industry veteran principals are directly involved in project development, financial analysis, technical specs

Unique engagement model mitigates project risks during development

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TerraVerde’s Mission

Assist California public agencies achieve energy independence, while obtaining meaningful cost savings, and a reduced carbon footprint

Serve as an independent advisor and owner’s rep, to develop & implement high value energy projects while mitigating risk

Set realistic goals & objectives

Educate clients about technologies, Utility tariffs/programs, project funding & financing options, incentives, regulations, contracts

Leverage advanced knowledge, tools, methods, and experience

Develop Client-specific comprehensive energy management programs

Demand management

Energy efficiency measures

Renewable energy generation systems

Systematic analysis and evaluation to deliver maximum benefit projects

Client-centric services: from concepts & plans to life-long operations management

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Our Approach

Comprehensive, independent project development and feasibility assessment via systematic due diligence

Define SOW, systems specifications, and project costs

Determine optimum system capacity and Utility rates

Detailed 25-year Savings cash flow pro-formas for various financing scenarios

Run turnkey RFP process using open-book bidding

Manage contracts, design, engineering, construction, commissioning and system performance validation

Manage on-going O&M, warranty support, performance monitoring and reporting

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TerraVerde’s Experience

Projects Completed To Date: $100 Million

Projects Under Development: $45 Million

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Sample clients:• Clovis USD• Lancaster USD• Rancho CA Water District• Visalia USD• Clovis USD• Sonoma County Family YMCA• Hemet USD• Eastern Sierra CSD• Inyo County• Burton City Schools• Petaluma City Schools• Golden Valley USD• City of Woodland• City of Lathrop• City of Bishop

What Our Clients Say

“TerraVerde emphasizes education and transparency. We feel confident that they provide us an unbiased assessment of the risks and benefits.”Don Ulrich, Assistant Superintendant, Clovis USD

“TerraVerde is the best partner I have ever worked with in my 28 years of school construction experience.”

Eric Cederquist, Superintendent, Fowler Unified School District

“TVRP paid special attention to our unique needs and requirements throughout the development and implementation process. Most importantly, they have worked as a true partner, providing information in a fully transparent manner and have worked collaboratively with us to address issues and problems that inevitably arise during the development process.”Steve Bolman, Superintendant, Petaluma City Schools

“It is my pleasure to provide my highest recommendation for TerraVerde. As their name implies, they have truly become our partner in all energy matters. Every person that we have worked with at TVRP knows our particular issues and concerns and is an integral member of our team as we evaluate both solar and now Prop 39 projects.”

Robert Groeber, Assistant Superintendent, Visalia USD

“While we were in the process of developing our solar project, we had over ten contractors participate in the mandatory site walk. One of the contractors said to me how fortunate our district is to be working with Terra Verde. They said that there is never a question as to what is expected of the contractors and that Terra Verde is very well organized which leaves little room for mistakes or issues once the project begins.”

Tracy Tucker, MOT Director, Burton City Schools

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