Big Energy Savings Place UH Hilo in National Spotlight

University of Hawaiʻi at Hilo
Dr. John Whittaker, (808) 974-7751
Vice Chancellor for Administrative Affairs
Posted: May 21, 2003

The University of Hawaiʻi at Hilo‘s energy saving program has gained national exposure through an extensive feature in the April 2003 issue of National Association of College and University Business Officer‘s Magazine (NACUBO). The six- page article is featured under the headline "Enhancing Financial Health: How UH Hilo saves big on energy."

"NACUBO is sort of the Wall Street Journal of my profession and is read extensively by college and university administrators, business officers and facilities planners," said Dr. John Whittaker, vice chancellor for administrative affairs. "Therefore, an article as extensive and prominently positioned as this one is a tremendous publicity coup for
the University and our energy savings program."

UH Hilo was guaranteed energy cost savings of $450,000 per year before inflation, and thus far expectations have been met and exceeded. The UH Hilo project is currently five years into its 10-year performance contract with savings totaling $2.7 million, as of June 2001.

Projections suggest that total energy savings by the end of the 10-year period could exceed $6 million.

The UH Hilo effort is a pilot project of the State Department of
Business, Economic Development and Tourism (DBEDT), which has been encouraging its state facilities to incorporate energy savings performance contracting (ESPC) as a means of financing their upgrades.

Lo-Li Chih, UH Hilo director of facilities, planning and construction, said UH Hilo benefited from being the first agency in the State to participate in this initiative.

"As the first project of its kind in Hawaiʻi, there was great interest in being awarded this contract, and that proved advantageous for the University," Chih said.

ESPC arrangements typically call for energy services companies (ESCO) to finance, install, and maintain building improvements with the cost of the retrofits being paid for through future energy savings realized from those improvements. Under UH Hilo‘s arrangement, the University was not required to provide a down payment in its capital improvements budget since Johnson Controls, Inc. (JCI) — the energy services company selected — provided the up-front costs.

The $2.9 million in capital improvements enabled the University to retrofit 50 buildings, including the administrative offices, classrooms, residence halls, Campus Center, library, Theater, shops, and the cafeteria. Retrofits included replacement or upgrading of lighting systems with energy efficient units, installation of new high efficiency chillers, and the addition of a building automation system to control major air conditioning units.

"The title of the article, ʻSaving Millions Without Spending a Dime,‘ says it all," Whittaker said. "That‘s the beauty of it, because it doesn‘t cost the colleges, universities or state agencies anything to get into the program."

Another bonus of the UH Hilo project is its maintenance program and assignment of a full-time in-house JCI employee to the project. Virtually all ventilation and air conditioning systems on campus are maintained, repaired and replaced during the 10-year contract period.

JCI also maintains insurance coverage on all contractor-owned and installed equipment until title passes to UH Hilo upon expiration of the contract. Chih said once the 10-year contract with JCI expires, at which time the full cost of retrofit improvements will be paid, UH Hilo will continue to reap benefits.

"As the University grows and expands utility costs cannot help but go up," Chih said. "But those costs will be limited through the savings generated by these improvements. That in turn will allow us to get more mileage out of our operating dollars."