Panel hears update on Johnson Controls work

A part of the $28 million energy performance contract between the city and Johnson Controls Inc. includes traffic signal improvements. (Journal photo by Lisa Bowers)

MARQUETTE — The Marquette City Commission recently heard an update from Ronald Stimac of Johnson Controls Inc. regarding the city’s energy performance contract with the HVAC corporation and local infrastructure projects that began over a year ago.

Stimac, a performance infrastructure account executive, has been with Johnson Controls for 21 years and was the original business consultant working with Marquette officials on the $28 million project, which he says is expected to save the city $42 million in 20 years.

“The savings that are generated in the project are going to pay for every improvement measure that’s being executed right now over time,” Stimac said. “If there’s a shortfall in those savings for any reason as part of the project, Johnson Controls’ financial checkbook is on the line and we cut a check for the difference.”

The city approved the energy performance contract in August 2017 with Johnson Controls, an American multinational conglomerate that produces automotive parts as well as heating, ventilation and air conditioning equipment for buildings.

The scope of work includes: upgrades at 22 traffic intersections; replacing 3,300 water meters with a “smart city” advanced metering infrastructure system; renovations to city hall; LED lights on 2,500 street lights and 125 bike path lights; an electrical co-generation plant at the wastewater treatment plant; numerous building envelope, lighting and HVAC improvements; and completing the Lakeview Arena’s ice system replacement.

“It’s really based around technology and being able to communicate and having devices communicate with each other to make it more efficient throughout the city,” Stimac said of the projects.

The extensive project has created 37 full-time jobs, Stimac said, and over 78,000 hours worth of local labor with prevailing wages before the state eliminated the prevailing wage law.

A loan through Bank of America has funded the upgrades; however, the loan doesn’t register as debt due to state laws enacted two years ago that allows local governments to use tax-exempt lease purchase, or TELP, agreements to finance energy conservation improvements.

The work is anticipated to be completed by March and the city will pay off the cost over 20 years at an interest rate of 2.84 percent.

The biggest savings perimeter is on the electrical side, Stimac said, adding that the project will reduce kilowatt-hour costs from $1.1 million to $593,000 annually.

Commissioner Paul Schloegel said he’s excited about the project and glad things are moving along.

“There’s a lot of people that go on social media and talk about these programs the city is running and I hope they’re out there watching today … to show what this program was put into place for,” Schloegel said.

Commissioner Mike Plourde echoed his thoughts and said he’s looking forward to seeing the savings in March 2020.

Stimac said the city of Lansing is using Marquette as an example of what they should be doing in regard to conserving energy.

“So just (for your information), Lansing sees you guys,” Stimac said.