Energy saving contracts reduce environmental impact; state agencies keep money saved

FRANKFORT, Ky. – In celebration of Earth Day, Gov. Steve Beshear signed Senate Bill 70, which allows for more Energy Savings Performance Contracts (ESPCs) to help state government achieve significant savings on utility bills.

Since 1996, the Finance and Administration Cabinet has successfully implemented more than $200 million in ESPC projects.

“Finding ways to reduce state government’s energy and utility usage is the right thing to do,” said Gov. Beshear. “What’s even more important is that agencies can use the long-term monetary savings to invest in critical programs like protecting our elderly and educating our children. It’s good stewardship of the environment and taxpayer dollars.”

This bill updates the statute to broaden the allowable scope of ESPC projects to include all types of conservation measures.

“This Earth Day, let’s remember how important it is for us to lead by example,” said Sen. Stan Humphries, of Cadiz. “I hope that SB 70 is a starting point to finding other ways we can save energy – and money – across state government.”

ESPCs allow state government to achieve significant savings on utility bills by financing energy efficiency projects with the savings achieved by the efficiency. Once the project loan is retired the agency can use the savings to fund other projects or offset their operating costs.

The 1996 legislation defined projects as those focused on energy savings for buildings. Senate Bill 70 expands the type of projects that can be undertaken such as water consumption reduction measures and more energy efficient streetlights, as well as other real property improvements not typically defined as buildings.

Kentucky has been recognized as a leader in energy management control and conservation with its Commonwealth Energy Management Control System (CEMCS). CEMCS gives the Finance Cabinet a complete understanding of the energy consumed in CEMCS-enabled state-owned facilities – every minute of every day. Taxpayers can see in real-time, month-to-month savings the Commonwealth achieves via the online tracking dashboard at www.kyenergydashboard.ky.gov.

Senate Bill 70 mirrors Gov. Beshear’s efforts to improve the health of all Kentuckians. The Governor launched kyhealthnow last month as an aggressive and wide-ranging initiative to significantly reduce incidence and deaths from Kentucky’s dismal health rankings and habits. It builds on Kentucky’s successful implementation of health care reform and uses multiple strategies, like a well-balanced environment, over the next several years to improve the state’s collective health.




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