A recent analysis shed some unfavorable light on the LED conversion program in the City of Northville.
During a recent meeting of the members of the city council, DPW Director Mike Domine recommended the city exercise the buy-out option included in the program agreement. An analysis of the costs demonstrated that the program has not produced the level of energy savings predicted. Northville entered into an agreement in January 2021 with the Energy Reduction Coalition (ERC), an Ann-Arbor based nonprofit, to convert city-owned lighting at the water tower, Northville Yards, and parking lots and structures to LED lighting.
The agreement included the installation and maintenance of the infrastructure necessary for the conversion at no cost to the city, valued at $149,000, according to officials. The replacement program, completed in March 2021, was expected to generate enough funding in energy savings to pay for the cost of the program. Recent studies, however, demonstrated a far lower cost savings on electric service than projected by ERC representatives.
A city study determined that the project information used by ERC, including meter location, number of lights and type of lights prior to conversion, was not accurately recorded. The study also found inaccurate invoicing by DTE before and after the conversion. While conversion to LED lighting decreased annual kilowatts per hour used in some areas, it increased costs in others, according to the data provided.
As part of the agreement in 2021, the city had the option to end the contract after two years by repaying the ERC investment in the installation of the necessary infrastructure. As no significant savings have been realized, Domine recommended that the council members authorize the buy-out provision of the contract which repays the ERC investment in lighting infrastructure at a depreciated rate.
Council members authorized Domine to start the buyout process with ERC at a cost of $132,737. A budget amendment was approved to draw $29,636 from the General Fund contingency, $16,430 from the Equipment Fund, $86,565 from the Parking Fund and $107 from the Water and Sewer Fund.
