Episode 42: Decarbonizing Heating & Cooling: Thermal Transition in Action
Dave Karlsgodt 0:00
Welcome to the campus energy and sustainability podcast. In each episode, we talked with leading campus professionals, thought leaders, engineers and innovators addressing the unique challenges and opportunities facing higher ed and corporate campuses. Our discussions will range from energy conservation and efficiency, to planning and finance, from building science to social science, from energy systems to food systems. We hope you're ready to learn, share and ultimately accelerate your institution towards solutions. I'm your host, Dave, Carl Scott. I'm a Director of Energy and Sustainability at drills for the web.
Dano Wiesbord 0:38
Students and faculty want this because boards are always looking for we're going to spend money, we're going to spend it on mission. We're going to spend, right you're going to spend it on classroom, you're going to spend it on students, we're not going to spend it on pipes and wires.
Elizabeth Drake 0:54
There is no do nothing option here. We have to spend this money either way, why not invest in the future?
Camille Kirk 1:01
Don't get hung up early on. If you hear no, no just means that sounds hard. You need to tell me more.
Dave Karlsgodt 1:11
In this episode, you'll hear a panel discussion recorded at the 2023 higher education Climate Leadership Summit, co hosted by second nature and the intentional endowments network or ai n. The title of the session was decarbonizing heating and cooling thermal transition and in action, you'll hear a full introduction for my fellow panelists and more background on our topic in a moment. But for now, a special thanks to second nature and Ibn for running such a great summit this year, and for giving their permission to share this engaging conversation on this podcast. If you like what you hear, you can still register for their 2024 summit, which will be in Long Beach, California, February 11 through the 13th. I hope you enjoy this session recorded in February 2023 on the University of Miami campus.
We've got roughly 90 minutes for this session. We've got some time, but I know it's gonna go fast. So again, like the previous sessions, please, if you have questions along the way, put them in the chat. If you can be a time at the end, we can even raise hands and things. I think there are some people watching online as well. So same same rules apply there. But I'll just start by welcoming you all to this session, decarbonizing heating and cooling thermal transition in action. So we're getting to the action part of the planning part. I'll start introducing myself. My name is Dave Carl Scott, I'm the Director of Energy and Sustainability at Brailsford and Dunlavy. Just a few words about our firm. We're an owners advisory firm that works with higher ed clients all over the country, we work on lots of different asset types, and I lead our energy and sustainability practice. It's a pleasure for me to be able to work at a company who has in our purpose statement been inspiring, empowering, and advancing communities. So kind of tying back to some of the themes from earlier this morning. I am super excited today, because I get to lead a discussion with great friends of mine people. I've worked with many of them for a decade in some cases or more. But a little background on me, I am currently a consultant before that I was a software developer. But if you know me really well, you'll know that I actually started as a jazz musician, and why do I bring that up? I bring it up for two main reasons. Number one, I know there's a lot of people in this space that are like trying to figure out what's the sustainability thing? I cannot really do it. And could I really be like these bold people on the stage here? And the answer is yes. And the reason is, because this kind of work requires different kinds of thinking and requires collaboration, iteration. And we're gonna do a little jam session here in a very conference buttoned up sort of way, I suppose. But maybe if the audience can help out a little bit at from time to time, like they say something really cool. You know, give them a good shout out. So I don't remember, should we do a practice, like, act like you're gonna say something inspiring, but don't actually do it just so, so. So we want that in here, we want to get them going, we want to get that, you know, otherwise, you guys are gonna fall asleep and like, just be thinking about what drink you're gonna get afterwards. So let's keep the energy out. What are we going to talk about today? First of all, this is the sustainability conference, not the International District Energy Association. So they can mention they have boilers, but we're gonna limit the stats. And you know, how many chillers they have and stuff like that. This is not really about the technology, this is going to be more about how do you get your institution to make these transformational changes. So that's, that's our broad theme. My rules here are going to be pretty simple. I'm going to run down the line here, let everybody give themselves an introduction, talk a little bit about the project or work that they're doing that got them on stage. And you should know what that is by now. I hope so if you did our prep work, and then I want each of you to leave us a riff. So some thought, and then we'll come back around and subsequent questions. So So think about your riff. I know Daniels got a couple but he can drop them. We'll see which one index i All right. So with that demo, pass, click the green button.
Dano Wiesbord 5:04
All right. Hi, everyone. My name is Dano Wiesbord sport. I am currently the Chief Sustainability Officer at Tufts University in Boston, Massachusetts. I've been there for three months. Four months ago, I was the Associate Vice President for Planning and Sustainability at Smith College in Northampton, Massachusetts. So the project I want to talk a little bit about today is the Smith College, decarbonisation project, campus geothermal project and my colleague, Beth hooker's here, who's carrying this work forward, some of you might have heard Beth talk earlier today. So very quickly, the image that you're looking at right now, this is April of 2022. And this is the Board of Trustees and the president and her cabinet of Smith College giving themselves a standing ovation when they approved the largest capital project in the college's history $210 million to take a 90% reduction of the campus carbon footprint, largely through electrification by a ground source heat pump. I am not, at this moment, going to talk about the technical details of that plan, although I would be happy to the technical details. And the financial details are right, there are a lot, it's highly detail. And actually, this is my point. So much of what we do so much when we come to an event like this, it's about knowledge transfer. We're trying to learn from each other how to do this work. And there is a there is a book that you can currently get for $0 on Amazon, called common knowledge. It's by Nancy Dixon, who was a faculty member at the Harvard Business School. And she talked a lot about knowledge transfer, and she puts it into some categories. And one of them is the close transfer of knowledge and the bar transfer of knowledge. Close transfer of knowledge is it's like a tick list. i It's like a assembly instructions, right? I can hand Dave the list of instructions, and he can know how to do that thing. Getting your board of trustees to approve a $200 million project is not that kind of knowledge transfer. Right. It is complex knowledge transfer it's about and I can't explain to Camille, how to do that for her campus until I understand her what I know about that it's not effective for her until I understand her political contexts or cultural contexts, her business context of her institution, all the complexity around that. And at the same was true when we presented this project to our board of trustees, there's so much information that goes into this level of organizational change, that you have to find ways for people to understand the entire context of what you're doing. And so to do that, the way we've been going about that is really thinking about what is the mission of the institution? And how do we draw on the mission of the institution. So higher ed, two primary missions, education, and the the building and dissemination of knowledge. And so we have faculty and students who do the things that lead to those two outcomes. And so here's an example. These are Smith College. This is Alex Barron, who is a faculty member in our Environmental Science and Policy Program and his student Lucy mess. And on the right side is Denise makan, who's a faculty member in Smith College engineering program and her students Sally Robson, at Smith, the engineering students graduate in their hard hats. That's That's what that's about. And Alex and Denise, as faculty spent years on our doing our strategic planning work, Beth talked a little bit about that work this morning. And in the transfer of that knowledge and of the approach that we were taking to decarbonize our campus. It was Lucy's research and Sally's research. So his research was on the role of battery power in our future electrified campus. There the ones who presented to our trustees on the policy context and on the technical contexts. So when at the end of the day, when the board approved this project, it was not about that they've never asked the question to our students and faculty want this? Because boards are always looking for we're going to spend money, we're going to spend it on mission. We're going to spend, right we're going to spend it on classroom, we're going to spend it on students, we're not going to spend it on pipes and wires. But when the whole thing comes together, that question never came up. Because it was obvious that the faculty work in the student work was aligned to what we were doing operationally. So that's how we did it. It won't that context will not apply to everyone. Now I'm at Tufts University. I'm dealing with very rural, a very suburban and a very urban campus, all of which have started the work of this kind of decarbonization planning, and all of which need to further that work. And now I'm trying at a larger scale to say, can we scale up that kind of engagement around mission activities with students and faculty to make a big change?
Dave Karlsgodt 10:24
All right, we'll pass it to Camille, and Camille, I've had the honor of working with you in the University of California on carbon neutrality for about six years now. And it's been interesting to see this transition from carbon neutrality to fossil free planning. So I'll be interested to hear that, but I'll just pass the baton to you. And
Camille Kirk 10:43
I did script because I, if I add live too much, it goes, my solo goes on too long. I will actually, I'm gonna draw myself deliberately here. So thank you for inviting me to be part of this panel. I'm really honored and happy to be here. I'm Camille Kirk. I'm the director of sustainability and the campus sustainability planner from the University of California. And we're at UC Davis and I realized there are multiple UCS. So on the California. Today, I'm going to share with you some of the things that we've been doing at UC Davis. And in particular, I'll start out with explaining the current work that we're doing on a fossil fuel free pathway plan and tell you about that. And then a little later in our panel, I'll talk to you about some very specific major direct decarbonisation work that we're doing that we call them big shut. So first, a bit of background and the slide is intended to help you with some background about University California Davis. We're located in Northern California near the state capitol of Sacramento. So we're quite north, not too far away from San Francisco. We opened in 1908. We're the most academically comprehensive public university on the West Coast of the United States, which means we have a veterinary school. We are a complex public land grant research university, we serve nearly 39,000 students, we have 25,000 employees with the size of a midsize US city on any given day on our campuses. We are a powerful economic engine for our state and our region are generate over $8.1 billion of economic activity annually. We are large, we're over 2000 hectares of land and over 1.9 million buildable square meters. We have multiple locations including our main campuses Davis, our namesake, which has a big academic agricultural research program. We also have a regional level one trauma hospital in Sacramento, and a medical and nursing school. So we've got all those clinical facilities as well. And then a bunch of research facilities sprinkled hither and yon across the state and actually do things out of state to our square meters or square feet, much of it are very high energy and high water use lab and medical space. So we've got a lot going on, that creates part of the problem. We use a variety of fossil fuels in our operations and infrastructure, just like all of you I'm sure the vast majority of our fossil fuel use 95% on any given year of our annual fossil fuel use is in the form of fossil and natural gas in our district heating systems and our standalone buildings. So we have, by far the majority of uses are two central plants at the Davis campus. And yes, we're that big. We'd have two different central plants with steam boilers and then we have a cogeneration plant at our Sacramento medical campus. So that context of what our problem statement is, I'll tell you about our fossil fuel free planning effort, the 2023 was going to get 22 But we needed two extra months. UC Davis fossil fuel free Cafe plan was prompted as a comprehensive and formalized plan by November 2021 petition on the part of students, faculty and staff for UC Davis to wean our operations off of fossil fuel use. The plan builds on over a decade of studies that were prompted by our 2010 Climate Action Plan. These studies were conducted by an for UC Davis on decarbonisation of our district energy systems so two central plants in the cogen plant, and also renewable energy generation both on and off site. UC Davis has implemented action from this planning work and we've invested in taking action for over a decade to reduce our fossil energy use and generate renewable energy. We have reduced our total operational greenhouse gas emissions to 1990 levels despite growing too and I'm pretty sure nearly triple our 1990 population and build space. This Fossil Free fuel free pathway plan is not a budget statement. It is an am statement. We have done all this work and there is more work to do to reduce our operational funding. Ethical and reputational risks, promote climate and environmental justice align with the UN Sustainable Development Goals, which is a big issue at UC Davis right now and the 2030 agenda and to responsibly renew our capital infrastructure with an eye to fighting climate change. The goal the plan is to eliminate 95% of our 2019 fossil fuel use in our business operations for a definition of fossil fuel free created by our campus Advisory Committee on sustainability. This plan investigates and documents needed building infrastructure management, procedural and financial changes to shift from direct operational use of fossil fuels to direct operational use of biofuels and renewable electricity. This does include consideration of strategies for additional renewable energy procurement beyond what we've already got. The plan also proposals, suggestions, not solutions, we're very careful about this word suggestions, policy ideas and processes for managing indirect use of fossil fuels associated with our commuting and our air travel emissions. The draft plan just issued demonstrates how UC Davis can eliminate 95% of our 19 2019 fossil fuel use and our operations by 2040 through a pace set of actions that will renew our infrastructure, about $1.2 billion all in, in current dollars across all of our facilities that will renew our infrastructure and allow us to demonstrate leadership that is replicable by other institutions and jurisdictions. As part of what we see as our mission to share this kind of knowledge with the world. We understand this to be the first comprehensive decarbonisation plan out of the University of California locations, and one of the earliest in higher education in the United States to be this comprehensive. Accordingly, we do acknowledge that this plan is experimental. And we intend for it to be seen as a base planning approach. We will continue to innovate and refine this plan as we begin to decarbonize UC Davis, we know you're not getting it all right on your first go. So they ask that each of us end with a riff a key message. And mine is this. And it's one that I've said a long time, sustained and committed engagement at all levels is the biggest challenge for climate action. We know the technological solutions to our problems, but those solutions will not be ado pted, or persist if we do not have engaged people at all levels actively and inclusively working in consensus to make enduring change.
Dave Karlsgodt 17:43
You said that to a beat though, that's great. Elizabeth, when I was at a conference pre COVID, not the one of Atlanta, but one prior to that it was in the Midwest and I had the pleasure of sitting with Dano and Martha Larson, who was on the stage earlier here today, and your former colleague, or Wednesday, and we kind of came out of the main session and had our own little mini session to basically talk about what we're talking about here today. It's been amazing to see like, since that time, how many how much work has happened on a lot of your campuses, no swap swap was no exception. So excited to hear an update from what's going on.
Elizabeth Drake 18:22
Great. Hi, everyone. I'm Elizabeth Drake. I'm currently the director of sustainability at Swarthmore College. In the Philadelphia suburbs. We are a small residential liberal arts college about 1600 undergrad students only, so about as small as you get in this room. And like Dave was saying, this is really a full circle moment, I think to be back at this summit this year talking about our decarbonisation efforts back at the 2020 summit in Atlanta actually gave a presentation about the planning phase of all this work. And kind of at that point, our next step was get Board approval. And here we are three years later. And we actually just started drilling or David's change wells in January. So it's really exciting to be back in this room with all of you in person and be able to share a bit about what we've learned about this process along the way. So when I talk about Swarthmore College's carbon free future, like many institutions, we signed on to the ACU PTC back in 2000. Well, without really a clear idea of how we would actually get to carbon neutrality. We set it 2035 commitment and said, you know, we have 23 years to figure it out. And here we are 11 years later, and we have figured out a lot more of that. Like many schools, we have a very old central skinny plant that is natural gas fired on Swarthmore campus sections of that distribution system are more than 100 years old. So we were at a point in time where we were faced with the choice, you know, we had to make an investment in our campus energy system. And we could either choose to kind of double down on fossil fuel combustion at our source of energy, or we could turn it forward that's permanent for your future and make make a campus wide energy transition. And that's what we've done. We are transitioning over to low temperature hot water coupled with geoexchange, and renewable energy to heat and cool all of our buildings on campus. Right now, we are actually in first phase of implementation. These photos are just a couple of weeks old. What we're doing in this first phase is drilling 350 geoexchange wells on kind of a central lawn area on our campus. And that top photo, the buildings you see on the right are residence halls. So this is right smack in the middle of our campus for drilling 350 800 foot deep wells, you see some of our staff there down on the right hand corner out there in the wellfield, very muddy weather in January, not when we hope to start. But everything takes a lot longer than you'd think in the construction world these days. So what was supposed to be a June 2020, to start ended up being a January 2020, restart. So we'll be drilling straight through the spring semester in this academic year, but a very exciting moment for us to actually have this contract off the ground. And we've been able to learn so much from our peers through this process. So our hope is that we can really share what we've learned from this implementation with anyone else who's looking to make a similar transition over to gos gauge. And I think that leads in to kind of my takeaway message about the wealth of knowledge and expertise that we have here in this room, and how much we can gain just from our peers. You know, just thinking about this today shout out to mark Larsen issued in the room back in 2019. You know, a group of us went to Carleton College with our facilities staff, to kind of prove to them that geoexchange can work in a cold climate. So the Carlton team was really instrumental in convincing our internal stakeholders that we could do a project like this. Another thing that was really critical for us was having an external advisory board in the implementation or in the planning phase for this project. Danna was on our external advisory board. So there's, there's so many peers, you know, in this space that have helped us along the way. And we can learn so much and go so much further if we work together on these kinds of projects. Michael,
Dave Karlsgodt 22:17
I'm gonna give you a shout out, I didn't warn you ahead of time. Rob can corroborate this but I will first of all give you guys credit for what now is called the second nature pro bono program because we saw you guys doing something similar in your work at Evergreen energy and copied it and worked with second nature to do some of the early planning work to get some of these types of projects off the ground. But excited to have the the folks on this side of the panel that represent I guess I'm on sandwiching from the from the private sector. But this is important to have you guys here as well about how do we actually get these things done, you guys make your business on these projects. So I'm excited to hear from both you and Rob about how you introduce yourself and what your risk will be.
Michael Ahern 23:01
Thanks. So Michael Hearn, Senior Vice President of system development at Evergreen energy. Fundamentally, we are an operator manager of utility systems, sustainable utility systems. We have 10 different utility businesses around the country that we operate, manage. And every single one of those utilities has a decarbonisation initiative of decarbonisation commitment to them. And each one is at various stages of implementation. The other part of our business, which is the group that I lead is our system development group. And that's our engineering and development arm. So we will work with other campuses and communities helping them develop or advance their utility programs, helping them achieve their goals around decarbonisation around growth around integration of new technologies. And it's, for us, it's a, it's a fantastic opportunity to take the discoveries that we have from our operations side of our business, and bring that out and share that with with all of the other campuses, communities around the country that are looking to, to accomplish some type of goal as well. And then on the flip side, we're able to take the discoveries from our system development and bring that back to our operations. So we're continually advancing those systems as well as it's just a fantastic opportunity for information sharing back and forth. The project I want to talk a little bit more about today is the Oberlin College, decarbonisation program is this sustainable infrastructure program that that originally back in 2016, we led the the development of a decarbonisation master plan for them. And from 2016 Up until 2020. We were going through iterations of that plan and and ultimately getting stakeholder engagement and stakeholder approval board member or Board of Trustees approval to move forward with our recommended solution which, as everybody else is saying these days as geothermal and I'll echo Martha said this earlier, Daniel said it Camille said the one of the most important aspects of getting this to implementation was making sure that we had stakeholder involvement at all aspects of the institution, admissions, the student body, the faculty, staff, the executive leadership, back fac operations, obviously the sustainability office having everybody hand in hand, one common set of goals that we established very early on in the development of our master plan so that every time we were making a recommendation, we kept pointing back to the goals that that entire group had had embrace. Mark, just like Martha had mentioned in an earlier session always pointed to the why, why are we doing this? at Oberlin, we began conversion of the campus. It was an old steam system that fed the campus in a rather small chilled water system that the college wanted to expand. So first phase of construction started in spring of 2001. It's a four Phase program that will be completed at the end of 24. And starting here, likely this spring, we will be starting to drill upwards of 875 geothermal wells, roughly 600 feet deep beach to be the primary energy source to serve the entire campus. Part of our program. And originally it started out as a decarbonisation program, but it quickly grew, because because of the fact that there was other infrastructure needs that the campus needed to address. So we became the sustainable infrastructure, it was a once in a generation investment that the college needed to make to address the deferred maintenance issues inside of buildings or going into a building and ripping out all the steam and condensate piping, but you also start to discover, make up air units that maybe aren't operating the way they should be in pumps that maybe aren't operating the way they should be. And so it blossomed into a much more comprehensive program, but ultimately is going to give the campus a much more efficient, lower operating costs, a much better product, and a system that's going to operate the way they want it to long term, you can see some of the statistics that we've identified as part of this program, when fully implemented, clearly a significant amount of water savings, which is which is fantastic. There's more and more of a nexus between energy and water occurring all the way across the country. Certainly, in some areas, it's more so than others west coast, definitely not necessarily in the Midwest so much. But it's that nexus is growing, and more so on the East Coast again. The one item that I wanted to touch on as part of this slide, though, would be the fact that and this will end up being my riff as well. But there are a number of different financing and organizational structure options that are available for for implementing these types of programs. It doesn't always have to be campus funded. And you'll note here up in the upper right corner, we actually helped the college issue the first tranche of money needed for the program, which covered our 2021 and 2022 work, the $80 million of climate certified green bonds, those bonds, when we issued them, they the college was able to obtain the lowest cost of debt they've ever obtained on any bonds. Because of that climate based green certification. They and in parallel to issuing these bonds, they issued just some other bonds or some other campus work. These bonds for this program were at five basis point lower on the debt, which as you can imagine, for $80 million, is going to bring some significant savings back to the college. And those bonds that we issued at that time were three times oversubscribed. So there is a market out there for that type of money for these types of projects to decarbonize your campus, there is an attraction there from the private markets, one size doesn't fit all for your organizational structure and your debt financing. You should look at different options. And the key though, is to make sure that your the money that comes in comes in in a manner that still aligns with the mission of the institution. What you don't want is competing interests in that money, some outside entity that's got different objectives than what will be the mission of the utility investment that you make. So there's lots of different structures that can get set up nonprofit structures, nonstock corporation structures where you can leverage outside debt financing, to implement your program, while still keeping that utility system aligned with the overall mission of your campus.
Dave Karlsgodt 29:07
Alright, Rob, last but not least, by any means. I've been warned by your family never to ask you to sing or play music. But I know that you can sing the financial business case making thank you so
Rob McKenna 29:19
so this map is up here. This is meant to represent some of our experiences in salsa, Brian on helping with these energy transitions across the country. And this is not up here to celebrate us or how good we are because, you know, Michael could put a similar map up there and Martha, Martha, you're gonna have to come back up here. We've every one of us referenced you up here so you can put your map up here. For me it represents the fact that hey, there's a lot is happening in this space. There's a lot of people that are working on decarbonisation, moving things forward, electrifying their thermal supplies and and moving in this direction. But the other thing that I'll point out there is there's a lot of those that are met After plants, the orange colored dots that unfortunately kind of stayed there. And that's what I'm hoping we can talk about today is how do we get past the orange dots and get to the green dots and actually implement these things. And there's just two things that I'll point out. So I started my work with colleges and universities, about 1516 years ago, we worked on Cornell University's Climate Action Plan. And we were interviewing a variety of stakeholders on campus. And we had one interview with with the professor. And we sat down and started talking about the goals and ideas that we thought would be great. And we said, well, what are your thoughts? What do you want to do? And he said, You want me to come up with ideas, I don't come up with ideas, I poke holes in ideas. So give me an idea. And I'll critique it. And I was like, Really, that's how these theses work. So that if that's what you have to deal with at college, and universities, I'm sorry about the kind of environment that you had to work in. But hopefully you can find collaborative opportunities. The other thing is, and again, I'll mention reference Martha again, we started working with Martha What 2010 On the Climate Action Plan at Carleton College long time ago, and 2022 and off steam. So 12 years, and there was lots of stuff that took place before that. And there's still lots of stuff that has to happen in the future. These things take time. And you just have to start, you have to start moving. Daniel mentioned this. It's not a technological problem. It's just an inertia, you know, getting getting things moving. And that's what I'm hoping we can focus on here today. But I need to hand this back to you.
Dave Karlsgodt 31:34
It's fine. You can. Yeah, yes.
Rob McKenna 31:37
Oh, well. I did have one final point. Oh,
Dave Karlsgodt 31:39
yeah. What's your riff?
Rob McKenna 31:40
We have to avoid headlines like this. I don't know if you all saw this Reuters. November of last year, US colleges tawdry, but they haven't dirty secret. And it talks about all the fossil fuels that are still being combusted on stage. But take a look at it. We could argue about some of their conclusions. But we want we want to avoid headlines like this
Dave Karlsgodt 32:01
right here. One more click and I think that's funny. All right. So my first question, I want to focus on the higher ed institutions in the house here. We were doing the performance part where we did their riff. Now we're going to workshop this a bit. So you have to explain how you how you did your riff. So making the business case for these projects where you said $200 million, with 1.2 million or a billion or 1.2 billion and we're in the hundreds of millions of dollars, there's a lot of money on the other side of the table, or at the moment, at least in theory, how the heck did you do it? That's the simple question. So tell us a little bit more about the mechanics of how you got that process approved. I know Danna, you mentioned a few things in your intro. But can you expand on Shannon's story or, you know, feel free in this can be free floating between three of you? Sure.
Dano Wiesbord 32:46
I mean, I think I think the key thing, people look at Smith College, and they say, Yeah, you know, you're wealthy institution. So we understand how you, you know, you have great bond rating, you know, you bonded for this, we understand how you paid for it. But the moment that the penny dropped for me was when Denise who was in one of those slides, and I and a couple of her students, we identified in 2017, every geothermal project that existed in higher ed in the United States, everyone that we can find, we found about 100 of them. And then we started calling. And this is where that far transfer of knowledge comes into play. And what we discovered was we found places like Missouri science and technology, which were institutions that had completely changed over their heating and cooling infrastructure to a low temperature, hot water, geothermal status. They didn't do it because they had a climate goal. They did it because they had a deferred maintenance problem. And they were looking for a lower operational costs, infrastructure system. And when I heard them talk about that a public institution talking about that I realized this was that we could do this, but we really needed to drill into that lifecycle costing so I mean, Rob, and I, and for Rob, I woke him up early in the morning, he lives west of me, so many times, you must have read on our lifecycle costing, you know, 12 times. And well. But, but it was really we looked at a 30 year, we looked at a 30 year business as usual versus a case. And we continually updated and revise that as new information came along. And we put all of the first cost all of the operational costs into that. We learned that from the other Miami University to Miami, Ohio folks who really gave us a sense of what all was in that operational costs, and how much they were really spending on their utilities, post construction. All of that learning from those other institutions fed our Our business case as well as the the engineering work that came from from Silas O'Brien. So we are really indebted to all the institutions that went before us. But we really spent a lot of time on that, on that lifecycle costing and it was very influential at the end of the day. Well,
Camille Kirk 35:17
since this is a jazz session, I'm gonna fully pick up where you're leaving off and add on to that we did the same thing. So while you've got everybody up here, I think is doing the same thing shifting from steam to low temperature, we're getting hot water, using some geothermal. Why? Because you've got shoulder seasons in the winter, and solar thermal is not so great in winter. So we're doing the same thing at UC Davis. We've already started, we completed the first thing neighborhood, I think, Can we roll back to my slide? One, one, there we go. Okay. Okay. So if you take a look at the map of the purple on it, and a red check on Hudson quad, this is our core campus in Davis, that we're that served by the central plant with giant steam boilers. 50 years old, these things are actually they're 55 years old, you know, so they qualify as antiques, and we don't want them. So we're in the process of moving over, we've done this big red purchasing quad neighborhood. We're now in the middle of our construction planning drawings for the two purple, the life sciences, which we now call the sprocket district and the central plant, where we're going to put in heat recovery chillers down at our thermal energy storage section in the lower blue light blue square. So it's, this is uh, this is 900 acres, or, yeah, 900 acres, just this core campus that served by the central planner, that's big, that's bigger than most campuses. I'm gonna guess. So you can imagine that this massive undertaking one, it has to be phase two. It's really disruptive. really disruptive to campus. We're digging up a lot of stuff. And we've got to getting utilities like everybody. We didn't have masterplan utility corridors, we have literally spaghetti utility corridors, and it's very expensive, but we're underway. So what did we do? How did we because what's our recipe? How did we do this as a public institution that while we have money we don't, we're not private. So we don't you don't feel that we're Stanford. Here are key ingredients. First, we had a small cohort of very persistent staff that kept collaborating and working this forward. So persistence, persistence is really important. This kind of work is like a chess game. You're playing a long game, you're playing down the board, it's strategic. Don't get hung up early on. If you hear no, no just means that sounds hard. You need to tell me more. Second thing I mentioned, it's going to be a half at 1.2 billion all in for this fossil free stuff, which by the way, is including like retrofitting our fleet and our small equipment and a bunch of other things. This work half a billion dollars on the Davis campus, another half a billion over the Sacramento campus to move that cogen plant similarly to hot water and electrified. What do you need to do with that you need to make a really good business case. Everyone up here has already told you to make the business case, how do you do it Dano already said you do a lifecycle cost analysis, and you use a long enough period that reflects what you're really doing higher education is in it for the long run. Higher education is one of the oldest institutions on the planet, we are here for the long run. So you can take a long period in your life cycle cost analysis for us, we use a 50 year not 3050 year period in our life cycle cost analysis, because that's about the amount of time you can reasonably expect a steam system to last before you're going to have to renew it. And our business as usual base case, plus, we just re up on our steam system. That's what we call this our constant. And we looked at sense you can see in this chart looked at I'm sorry, five different other things as different ways we could get there in our life cycle cost analysis, steam lost steam loss because of lifecycle cost analysis, because we counted in operational and commodity costs, in addition to capital renewal. And as David Rob likes to say the future isn't free. So that's why this lifecycle cost analysis matters so much, you're going to send money, even though your region's or trustees may not really want to believe that they have to spend money on infrastructure they're going to so show them why you want through a business case lifecycle cost analysis, why they want to move to a different system. It's very, very powerful. This is what sold it, this lifecycle cost analysis, not do the right thing is what sold it to our financial officers. Yeah, I'll leave it at that.
Elizabeth Drake 39:49
Great and I'll cast a third vote for lifecycle cost analysis. Also a key piece of kind of getting our plan across the finish line towards implementation. Have we modeled our project out over both 30 years and 50 years recognizing kind of the long term implications of making these kinds of investments in campus energy infrastructure, something else we also did with our lifecycle cost analysis was incorporate a shadow price on carbon, we did our LCCA as if we pay $100 per metric tonne of co2, ie that we emit. So when you look at the the real costs of emitting carbon that aren't, you know, typically captured in that kind of financial analysis, it really widened the gap between these two potential trajectories that we could take between our business as usual, and this investment in our energy transition. Something else that was really key for us to emphasize in that LCCA is that there really was no business as usual for us, we had to invest 10s of millions of dollars in our energy infrastructure either way, and we could either, you know, make that choice that really runs contrary to our mission of educating students for the common good, or we could choose to pursue this more forward looking investment in renewable energy and geoexchange. So the life cycle cost analysis and an emphasis on there is no do nothing option here, we have to spend this money either way, why not invest in the future. I think a couple of other things that were really key for us that were touched on earlier today already had to do with aligning kind of our carbon neutrality goal with other campus needs, so that this wasn't just a sustainability project. You know, our sustainability team sat down with stakeholders from facilities and maintenance and capital planning and other groups on campus to really understand what the bigger picture needs were for our campus. And out of that came goals around reliability and resiliency, comfort in residence halls and academic buildings on campus concerns about the risks associated with aging, infrastructure, all of the deferred maintenance needs that we have on campus, and all of these things that we were able to kind of bundle together comprehensively into this plan so that by the time we went to the board, this wasn't just us asking for 10s of millions of dollars for carbon neutrality, it was all of these things that would make our institution better for everyone. And I think the third thing I'll just touch on was the advisory board that I mentioned already, we put together an external advisory board for our planning process that included a couple of members of our Board of Managers, as well as experts from other higher ed institutions and outside experts kind of in the energy space. And I think in particular, having those board members on that advisory group made it so that by the time we actually took the plan to the board, we had two really influential stakeholders, who understood the plan kind of front to back and were able to authentically advocate that this was the best choice for the institution. And I think without that kind of support, and there's that external validation from peers and other experts, I don't think we would have been able to get a plan like this across the finish line with our board. So I think all of those things were really influential for us in that process. Right. So
Dave Karlsgodt 43:04
switching gears for our private sector friends here, you're in the business of producing these systems, in some cases, but taking risks to fund these systems, you're kind of part of the business case making but also have to believe the business case, because you're basing your business on it. First question from both of you, and you can kind of riff off of each other to the extent you want would be, what is a good campus deal look like from your perspective? And like when you when you go in there talking to one of these campuses? How do you know that they're going to actually be able to get there from from a business case making perspective.
Michael Ahern 43:38
So a lot of is what's already been talked about. amongst all of us, it's having the long the long play that the long term commitment, and certainly that's inherent with college and university campuses right there. They're going to be there 3050 100 years from now. So they can look at that long range, profile and accept the fact that we do a 30 or 40 or 50 year life cycle cost analysis. One of the most challenging things in the private development world is, is quite often you have developers who won't look past, some will look past three years, most of all in the past seven years, and trying to convince folks that 30 year investments are good ideas when they know they're probably not going to own that infrastructure and that property seven years from now. It's just it's very difficult to get them there. The example I have here is a system that were just up in in startup and commissioning right now for land that's owned by the San Francisco port that the giant the San Francisco Giants basketball or baseball team and Tishman Spire are redeveloping three and a half million square feet on this 28 acre site. The port came in and essentially required a mandate that this campus this redevelopment will be a carbon free redevelopment and it also will have water systems that don't utilize any potable water for non potable purposes and going back to that water. Energy next As we laid out a program to finance this system, you're setting up a nonstock for profit corporation that essentially operates in collaboration with the entire development, again, 100% debt finance, but we were able to set up the mission of the utility to be what is most important to the local stakeholders. So having to answer your question, having some those those champions of it, that understand the long term vision or mission for that campus for that community. That's where we get excited, because now we know somebody who's going to work with you past the problems, because there's always going to be problems, but there's always a solution, if there's a will, right. If there's a will, there's a way.
Rob McKenna 45:42
Excellent. So what I'd add to that is that when we when we work with the institutions that often will come in, and there will be an investment opportunity like this, like an energy system, and then want to bring it into the same decision processes that all other decisions are made by so you know, a new academic program or a new student center or whatever. And these are, there's a certain set of criteria that we see the financial decision being made by basically, what's the first cost relative to how is this impacting our mission or what we're supposed to do. But energy systems are a different type of investment, they need to be looked at from a different lens. So Michael, who's coming from the capital markets side of things basically looks at things basically, risk versus return. When you look at an energy system, that's a great investment from a risk versus return perspective, but it's in the typical lens that university administrators gonna look at things, it's hard to kind of weigh that out relative to everything else. So those institutions that are kind of willing to realize that maybe I've got to put on a different set of glasses here. Toka, this project versus typical things that I'm approving, that was a long way to kind of make this move a lot faster through the process, you can tap a different lens,
Michael Ahern 46:57
I will just one more. Go just continue to read it reiterate, if if the entire program or the initiative is being pushed out from the Sustainability Office, and you don't have engagement, from fac ops, and from campus leadership and from the faculty and from the student body, you're fighting an uphill battle. That's the first step should be getting that multifunctional stakeholder group together to be the true champion of whatever solution you ultimately get to. Excellent. Alright,
Dave Karlsgodt 47:31
so in keeping with my jam session theme here, so and Bridget, I'll put you on notice, as with this as well, I want to move to questions, and it will be probably a decent amount of questions coming up. Before we do to give her a chance because she was listening and not getting ready to answer questions. I would like, I'm going to try something, we'll see if this works. And this is more for their entertainment than for your comfort. So just so you know. Great. I want just one liners, you heard from somebody else that that hit home for you. In any order. Like what are some of the themes that you've heard some of your colleagues that new thinking that you just came to this, and I'm I'm stalling for Bridget here. So,
Michael Ahern 48:09
but I'd say Elizabeth and Camille, well, everybody's been saying that you're going to make this investment, we're going to invest in this infrastructure anyway. And it whether our goal is to achieve it by 2040 2045 2050 2030. The reality is we have to replace pipes. At some point, we have to replace boilers. At some point, we have to replace chillers. Let's be thoughtful about that investment. And it doesn't necessarily mean that you have to make the investment today, it could be that you have a plan that's laid out over 10 to 15 years that says when this fails, this is what we will do. Many times you can get leadership within the the campus community to get to embrace that much more than just coming in and saying write us a check to me.
Rob McKenna 48:52
And that's a hard thing for my experience for administrators to accept right off the bat. But I can only think about our 1212 iteration designate on the lifecycle costs. And it seemed like every iteration, there was kind of a bigger, broader understanding of Oh, yeah, this really does cost a lot of money to continue to operate our current systems in their current form. And, and then people don't want to really accept it for starters, but then they kind of come to that realization.
Dano Wiesbord 49:19
Right, because because there's this if you're thinking about the budget institution, you look at the operational budget in one year increments. Yes. Right. You don't build it out for 30 years or five years. Right. So I think it was maybe Michael or Elizabeth who said like, you know, the, the board doesn't, you know, they don't look at business, the business as usual case, right? Right. They're gonna be spending the money anyway. And so when you do the side by side, it makes a huge, it just makes a huge difference. And the other thing I just meant to add this into that business case piece if what we're waiting for is when you start looking at ground source Heat pumps in a environment like ours that is heating dominant, you need to add cooling to balance that system. So when we started looking at the system, we were we were buying a system that was to heat our campus. But what we realized was we could add cooling to 20 buildings. Okay? Adding cooling to 20 buildings is both helps us with competitiveness, it helps us with programmatic flexibility in the summertime and using buildings that we weren't using otherwise. So there were these other kind of like ancillary business cases that were sort of came trickling out of that process. And I wanted to keep those to keep
Dave Karlsgodt 50:39
going, I'm gonna, I'll give you the like the thing when the last round here,
Elizabeth Drake 50:42
we had a very similar experience at Swarthmore, where we have a number of our residence halls that aren't cooled, which is a big source of drama internally, with the student body, with parents with everybody. But pursuing a project like this enables us to expand cooling capacity on campus. So like you said, there's all those co benefits that you can really tease out from projects like this, that make such a difference, I think in selling these projects, something else that I think a couple people have touched on too, is just about finding your internal champions and allies within your institution, that these projects aren't coming from just one angle, the Sustainability Office or anyone else, like you said, I think for us, our facilities and capital planning staff have been incredible champions for moving these projects forward. We were in a fortunate position over the past, like five years or so we've rehired for two of the key leadership roles in our facilities and capital planning team. And we were able to incorporate carbon neutrality and sustainability language into the job responsibilities for those roles, which I think has really changed the game for us internally, that our carbon neutrality work really isn't driven by the Sustainability Office at this point, is driven by this mandate that's kind of been delivered to the facilities and capital planning staff as part of their roles within the institution. So there's no more kind of like convincing folks that we need to be investing in sustainability in our infrastructure, it's really just become part of the way we do things at Swarthmore, which I think has really changed what it's like for us to pursue projects like this.
Camille Kirk 52:08
I'm going to echo that and and agree, I think the notion of a champion, it's not a new thing, but it's really a key point, finding your champions, and they come from all levels, and you need them from all levels. One of the things we did with our fossil free plan was rather than having two people or consultant write it, we actually engaged operational stakeholders across the campus to be the chapter authors. So they're very invested. Because finally they get a chance to realize some of their other dreams, like reducing some maintenance headaches, renewing some infrastructure, or some building systems that they've been desperate to get done. Shifting to a different kind of energy provider, all these things, they're those are pain points for them. And they've been able to glom on and figure out ways to solve their pain points through another vehicle. And that I think, again, it's, you've heard it from everybody up here, when you can get more than one person's goals met through something, you're gonna have a lot more allies, and they are going to help you get this thing across the finish line. So that's, I guess that would be my my big echo of everybody's Yeah,
Michael Ahern 53:16
that was the funny thing for us at Oberlin. As like I said, many campuses each each building is built to a different set of specifications. And there's quite often not as much standardization, as you'd like to see across across the college campus around types of pumps and types of equipment that's utilized. So early on, when we were setting up basis of design, we we walked through with the facility operations folks, and we created standards for the for the entire design of the complete campus renovation. So now they they're actually getting trained on one standard that's getting deployed in all of the buildings. So they're super excited about that as well. And I think creating some of those little niche initiatives really, really helps.
Dave Karlsgodt 54:02
All right, how are we doing? Bridgette, we ready?
Bridget Flynn 54:04
Yeah, we have a few questions here. First, I just want to say Camille, I saw your graph of the comparison against business, as usual. And just want to say I was at Oberlin prior to joining second nature and bless Michael for having probably 12 different business, as usual case scenarios. So the first question you already started touching on. Each of you have mentioned this, but if you could speak more directly to it, there's a lot of folks who are really frustrated and thinking about how do we engage facilities regarding transitioning away from steam when they're still talking about adding to the steam loop? I know you started talking about a little bit but if you can keep riffing on on, that would be great.
Elizabeth Drake 54:49
I can start I guess a couple of things that come to mind for me. So I referenced earlier the trip that we took to Carleton College and the fall of 2019 with some of our facilities and maintenance folks, I think internally, we had a lot of skeptics about JL exchange and whether or not we could actually heat buildings in the wintertime with low temperature hot water. We had folks that just like, didn't believe that that's something that could work. And it wasn't until we went to Carleton and saw, you know, their old stone chapel that was being heated with hot water that they really actually believed that this was something we could do. And it really it was like a flipped a switch. I think for us internally, I think also addressing some of the ways that this transition could alleviate concerns of theirs around aging infrastructure that was at risk of failure. You know, operating a steam system with 110 year old distribution is a really risky venture to be engaged in and no one on that facilities maintenance team wanted to be responsible for the failure of our central heating system in the middle of the winter. So really helping kind of reframe a project like this is something that could sort of make their lives easier in the long run, I think was really key for us. Also minor things like not being able to find younger staff that have expertise in how to operate and maintain Steam Systems anymore. Like even just minor things like that, that we were able to kind of build on to help make the case internally I think was was helpful. It sounds like maybe you had some variances. Yes,
Camille Kirk 56:25
that's actually that was one of the big cells for our facilities, folks having a lot of problems finding steamfitters retaining steamfitters. Another thing that we had was, again, the aging steam system, we had vault, we have vaults. We've now abandoned those vault in areas of the campus that were so old that they were facilities staff were we'll just say unenthusiastic about going down into them. There was just a the business case analysis really drove it home for our financial folks, like why would we keep spending money on something that's going in the opposite direction of where and we do happen to be located in the state of California. So we do have some regulation that does help propel things along that not every one state has, but they were recognizing, like, the path is going here. And if we reinvest in scheme we're fighting we're swimming upstream. Why or what? Why do that to ourselves? So I think just helping people see why it would be swimming upstream can be helpful. Go
Dano Wiesbord 57:24
ahead. I just, I hear this right. This is a really common refrain of sustainability staff. I want to get facilities to do this, and they want to do that. Right? There's one or two things going and I think Camille and Elizabeth have sort of suggested, well, let's assume they want to go forward with this. They just don't know how yet, then the things that they suggested are going to work. Let me show you an institution that did the thing. And it works, right. But there are places and there are people who haven't experienced where they are as a sustainability office, they are in conflict with facilities, and nobody's told facilities that they have to change. And there's nothing that sustainability director is going to do to change that. Right, except drop an anvil on it. Right in that anvil, and this is in Beth talked about this earlier, you got to get leadership and board, right, you've got to have strategic alignment on this topic. And if you don't have strategic alignment on this topic, and the institution isn't telling the operational part of the the organization to do this, it's not going to happen. And you should stop beating your head against that wall, you should just stop. And you should focus on the next strategic plan that the institution is doing.
Dave Karlsgodt 58:39
I know we were so we were going to get too much into the technical but I do have maybe a technical question for for Michael and Rob would be it is possible to have things that have a steam system on one end and that steam on the other end. Can you explain how that works in these transitions? Because this stuff doesn't turn. It's not like you just flip a switch overnight, right? Like this stuff transitions over time.
Michael Ahern 59:00
Right? So at Oberlin, actually the first year of our construction, we installed a steam to hot water converter station in the central plant. Because we the way in which we modify or transform the campus, we essentially went from clockwise from six o'clock to nine to 12 and then to three over these four years. But we had you know, after the first year we had southern South Campus on the low temperature hot water system, while the rest of the clock is still getting served by steam. And that that is an investment you have to make. We did that at the central plant it made more sense because of how overland geography is laid out. There's circumstances there's a system in Duluth that Duluth, Minnesota that we transformed from steam to low temperature hot water six years ago, and in that instance, we put a steam converter station out on the loop at one of our customer buildings so that we could convert the furthest part of that camp of that system to low temperature water while still serving steam to the to the customers that are closer to our buildings. So the different different areas Since then, you know, again, it's relatively easy once you kind of lay out what's your overall program, but there's definitely a way to do that. And I'm sure you have all kinds of examples of how you guys yeah,
Rob McKenna 1:00:09
we can go on and on until
Dave Karlsgodt 1:00:10
my friend, Zeyneb Magavi in Massachusetts says, you don't you know, it's a tree, you don't start with the trunk, you start with the branches, and then work your way back to the market that sounds like you're describing. Yeah,
Rob McKenna 1:00:21
Dave, especially because pushing all that out requires so much energy, and maybe your facilities folks actually would be excited to get rid of some of those branches and start coming back. And
Dave Karlsgodt 1:00:29
excellent.
Camille Kirk 1:00:30
I guess I want to add one more thing, which is, persistence is the key here. So you're gonna hear no a lot, you're gonna hear it repeatedly, you're gonna hear it while people are spending money in ways that frustrate the heck out of you. Persist, you're playing the long game, you're not playing the short game. And that's where, you know, finding your alliances, waiting certain individuals out persisting, going and seeking expertise outside of the institution, because how could you possibly know anything, but those people over there, they are really smart, and they've got it figured out? And let's listen to them. Oh, they're doing the same thing you wanted. Okay, now we can talk because now I've heard it from someone else. Those kinds of strategies, however frustrating, they might be in the immediacy, just play it out, play the long game and don't take all knows as permanent knows. Often they're temporary knows, until people under understand how they can convert to a yes and how it makes sense for them to convert to a yes.
Dave Karlsgodt 1:01:33
Anyone else on that one? Otherwise, we'll go to another question.
Bridget Flynn 1:01:36
Sure. So we have a couple on dependency on the electrical grid. So one is in transitioning to ground source heat, you become more dependent on the electrical grid, did you make additional investment in backup generation for resilience?
Dave Karlsgodt 1:01:52
Yeah, have you guys broken the grid yet? Go ahead.
Dano Wiesbord 1:01:57
It's a great, it's a great question. I mean, I think there's there's two parts to this. One is, there's no question that we need to make huge investments in the grid, there is money in the IRA, there's money in the in the infrastructure bill, that starts to do that it goes to state states have to spend it, we have to spend it in the right ways in the right places. And we're gonna have to fly that plane while we're flying the other plane of like converting to electricity, right. So we had to do all those things. At the same time, Smith College, we had a cogeneration facility, and Tufts does as well, and we have to make decisions about these assets. The assets are not that old. And they have life in them. And one of the things is we had to make a decision about when we were going to say that that asset is no longer we're gonna stop it, it may not be at the end of life. But as a matter of policy, we're going to stop running that generation asset. And we're going to convert it to a resiliency and backup power asset. And as a as a resiliency and backup power asset. That thing is great, because I can run all my heating and cooling stuff off of it. So that's a big part one, the other one, and this is the one that I find confounding and Rob or Michael might have bet more insight into this. But like, there are a lot of places that I've talked to, and I would reference the Miami Ohio folks, again, where the operating facilities, they everybody says yeah, you're replacing all that gas, and you're gonna replace it with all this electricity. And actually, the amount of electricity that they're replacing it with is far less than what they modeled and what they expected. Because the systems have become more efficient. So yeah, it's more electricity, but it's not as much more electricity as you might think. And I mean, I hope that that's true for us and for others. But I'm curious if you've seen that in real life. Absolutely.
Rob McKenna 1:03:44
Yeah. And it's, it seems like magic fact, David had to put together a whole slide about UMass, if I remember correctly to show how, how can you take and supply the same amount of energy to your buildings for like, 50% of the purchase energy? It's, it's really we will spend another time when I spend more time on that later, right.
Dave Karlsgodt 1:04:01
Martha gets credit for that, too. Oh, really inspired that one? Yes.
Rob McKenna 1:04:05
See, she should be back up here.
Dave Karlsgodt 1:04:07
I know
Rob McKenna 1:04:08
No, it's It's amazing and, and really down to make the conversion. If you think about it from $1 and cents perspective, in most markets, you got to have a noose, if you're gonna go all to electricity, you got to have a new system that's three times as efficient as your current system to have a pencil just other dollars of BTUs that you're purchasing. And so that's why that efficiency is required, because electricity, just more expensive per PTU. But so the magic needs to happen for it to make sense. But you know, it's pretty cool technology, I
Michael Ahern 1:04:39
think, and several of the instances where we're helping campuses decarbonize The other thing we're doing is electricity, supplier, strategic investments in their infrastructure to be more reliable for the for the broader community. And we've been leveraging this these programs to actually help contribute to that investment to so that not only are we receiving a better product of Electricity more reliable. But also it's making us more of a partner with the local utility and and the community sees it as a benefit as well. One
Dave Karlsgodt 1:05:09
other comment I'll make, and then I'll pass it back to Bridget for next question. The other thing we're finding is there's a difference between doing a centralized system where you can run all that electrical infrastructure to the central plants. And the idea of decarbonizing every building, there's a lot of people out there saying, well, let's just put heat pumps in every building, which is a strategy and sometimes that is the right answer. But one of the challenges with that is now you've done electrical infrastructure upgrades everywhere you go. So it has different challenges. And you got to weigh the differences between those and see which one makes the most sense for you and the way you want to maintain. Bridgette, what do we got? Yeah,
Bridget Flynn 1:05:42
a couple of quick questions. So Elizabeth, can you talk about what the shadow price on carbon looks like in your life cycle cost analysis?
Elizabeth Drake 1:05:52
Sure. I wish I had some charts with me. But unfortunately, I don't. So we adopted $100 per metric tonne of co2 e shadow price on carbon back in 2016. Ish, and made the commitment at that time to use that shadow price in the lifecycle cost analysis for all of our major capital projects on campus as well as smaller energy conservation measures that we fund through our green revolving fund. So basically, what we do is we, you know, set the study period for LCCA, it could be 20 3050 years, whatever we decide is appropriate for that project. And then we model out the lifetime greenhouse gas emissions for whatever project it is that we're considering, based on kind of whatever scenarios we've decided on. So in the case of our energy master plan, we had that scenario of, you know, continue investing in our central steam plant, and using natural gas is our primary energy source that was kind of our Bau case. And as you can imagine the the lifecycle greenhouse gas emissions over 30 years for for that choice, I think the number was like 350,000 metric tons of co2 e over 30 years, versus the investment in our energy plan. That number, you know, went up a little bit for a few years while we implement the plan, and then it's stable. So we save hundreds of 1000s of tons of greenhouse gas emissions by investing in this and using the shadow price is a really clear way to actually put $1 value on that your units are something that people understand differently than metric tons of co2 E which really doesn't mean much to members of our Board of Managers and different internal stakeholders are like, okay, is that is that a lot? Is that a little like, what does that mean for the world for climate change for us, they don't really know. But being able to put $1 value on that helped us kind of put that metric on the same plane as things like maintenance costs and other costs that they're used to dealing with when thinking about big investments like this. So it was really helpful for us to kind of illustrate the long term climate impact or savings of this project over the long term for the college.
Dave Karlsgodt 1:08:03
Oh, good. Follow up, and then can I pass it to you? So did you guys actually use that to help make the business case? Are we able to make the business case without it?
Elizabeth Drake 1:08:10
We did? So we actually did both. We showed it to the board, one slide, like without the shadow price, and one with the shadow price? Because of course, there's some people that say, okay, but that's not like real money. Like, we don't have to write a check for that. So like, why are we even talking about that, like, okay, there, it's not money that actually changes hands. But it is still a real cost kind of that our decisions have on society as a whole. So we really showed it and both ways to, to include it, and then not include it so that we kind of serve both purposes. Excellent.
Camille Kirk 1:08:40
And then in our lifecycle cost analysis for the big shift the project I was telling you about moving from Steam districts team to district heating hot water, we had three different costs of carbon. So we had a social cost of carbon at that time, we were using $60. Since then, this past fall, you see the university, California has adopted a $246 per metric ton social cost of carbon that's equity weighted. So that really does start to make a difference even though you're right. It's not nobody's opening up checkbook and writing to the social cost of carbon fund, that it helps again, it helps reveal the risk inherent in choosing to go with fossil fuels versus choosing to move away. The second carbon costs that we had was the cost because we're in the state of California, of having to play in cap and trade. We're a regulated entity under cap and trade with twice both our Davis campus and then because it's geographically separate our Sacramento campus so we get to enjoy double the fun in cap and trade. And that has a specific financial value and cost to us. And then the third cost was because we have a carbon neutrality policy, we said well, we'd have to buy offsets. If we re up on Steam and use fossil fuel fossil natural gas, then we'd be buying carbon offsets to meet carbon neutrality. What is that and so you You have those three stacked bars. What's really interesting is that even with those, they were still much smaller than the operation of the commodity and the maintenance costs. So we could have, we could have used or not used those, and it wouldn't have made the business case. But it was an important tool for us to reveal the risk of continuing to use if we had to react on Steam continuing to use steam. And now the University of California is adopting in this equity, weighted social cost of carbon into all of our capital projects, we have a modeling tool that we use for that. And then also in our solutions modeling tool for greenhouse gas emissions and climate action. So really recommend a social cost of carbon as a talking point tool.
Dave Karlsgodt 1:10:44
So quick question for the rest of you. Have you guys all used one? And what are the ranges that you've seen? Like? What's the like some people? What's too little? What's two 248 is one of the bigger ones I've heard being used
Dano Wiesbord 1:10:56
was, so we at Smith College, we had one that was set initially set at about $85 a ton, but it escalates above the rate of inflation. There is a paper on the second nature website about how we set our social cost of carbon written by Alex Baron whose photo was up there who was the director of policy at the EPA. So it's, it's really good, it's, it's a super useful tool for those who want to explore setting a cost of carbon.
Dave Karlsgodt 1:11:26
Under the guise of ranges you've seen,
Michael Ahern 1:11:28
we're in that word, mostly using 100. But the thing we do with our lifecycle cost analyses are we we toggle that in, and we create a range that we talk through with the Board of Trustees and early in the planning process, to get them to really kind of embrace the fact that there's going to be a number in here and tell us what type of range you'd like us to model. And so then we can run iterations of the model out at different ranges to see how sensitive the overall model is to that
Dave Karlsgodt 1:11:53
we know you care about this, just how much we'll show it to you. That's great. I love it.
Rob McKenna 1:11:57
And Dave, the only guy that is get ready to educate, I don't know, let's see how much you had to educate. But if you're gonna put a number out there, you need to kind of explain why where it came from. And so read, read the Alex barons paper and talk to Elizabeth Camille about how to that's unfortunately, there's just a lot of questions that come out about that. And if you're going to use it, you got to educate on that subject. Very good. All right,
Bridget.
Bridget Flynn 1:12:20
Yeah, so for those who don't have the app, I want to also give you a chance to ask a question. So I'm going to first turn it over to here, because I saw a raised hand and then we'll go around.
Dan Dixon 1:12:34
Yeah, earlier on, you mentioned that running one of these systems uses only about 20% more electricity. So I just want to clarify 20% more than what
Rob McKenna 1:12:47
20 20% More than then the fossil fuel based system so So basically, what you what you get is enough with with efficiencies in your system that are going to decrease rather than decrease your electricity consumption. But then you're taking all your fossil fuel, you're now going to any energy that was provided by that you're now providing from electricity source. And so 20% More than you were previously is that mean? Does that answer your question?
Dave Karlsgodt 1:13:14
I think I think your question probably embedded it has what if you're using cogent and you're making your own electricity? I think then the answer is it's the price of the produced electricity that you were making in total. 20% More than that,
Rob McKenna 1:13:25
just want to restate it. I didn't answer it. Did I?
Sounds good
Bridget Flynn 1:13:34
Another question was, I think specifically for Camille, what was the useful life cycle of your ground source heat pumps? They were curious about kind of using a 5050 year life cycle cost analysis and the the lifespan of the heat pumps? Yeah,
Camille Kirk 1:13:50
and actually, I think I misstated. I think it was 60 years that we used, because we thought that that was the lifespan of steam, or at any rate, that's so those of you who work in public institutions, you know perfectly well that we use chewing gum and baling wire, and we keep things going long past normal capital renewal cycles, like who like when people talk about, oh, you're gonna do capital replacement, you're like, when it breaks, like and we can't fix it again. So for us, we use the 60 year period, and the geothermal the ground source heat pumps just kind of fell within that we are breaking it apart. So we're viewing first what we do is we just stop using steam, we get to hot water, we use a little makeup with boilers, and then ultimately, phase two, if you will, we can call phase one, the phases one B, one C blah, blah, one a one b to get through the implementation of putting in the the piping for hot water and putting in our heat recovery chillers because we're going to we have I should have mentioned we also use chilled water to cooler buildings, and we have this beautiful ability to tie in, right? We're not at zero degrees Kelvin, we still have latent heat in that chilled water, we can harvest it out with heat recovery chillers, you can put it into our heating system. It's the beauty of physics. And that's that's part of it. But it's not enough because we don't cool the buildings enough in the winter. And in part of the warmer seasons, that's where we put in the ground source heat pumps. And that just got counted in 60 years. But it should last longer,
Dave Karlsgodt 1:15:30
I think to the pipes, and maybe Michael can back up on this, a lot of that pipe infrastructure can last 100 years, potentially, right. So the heat pumps themselves are going to be have to be renewed on a more regular cycle. But you can replace a heat pump, like you know, so I don't know, maybe 1520 years of depends on what it is right? When you build that 20 And maybe replace that 40. Build that 20 and replace it for it. Yeah. So keep
Camille Kirk 1:15:53
it going with baling wire, rebar, keep rebuilding,
Rob McKenna 1:15:57
but those costs should be incorporated into the life into the
Camille Kirk 1:16:01
equipment replacement is is on a negotiated capital replacement schedule and the lifecycle cost analysis. Maybe not as aggressive as, as you know, a corporation might do but certainly something reasonable.
Dave Karlsgodt 1:16:17
Alright, so as we're pacing towards the end of our little performance here, oh, how about one more question. And then I'm going to have we're gonna go reverse or kind of final thoughts. So but one more question. Okay,
Bridget Flynn 1:16:27
so maybe you can make this a fairly quick one, then, Michael, the question was, how does sustainable finance work for mission rock?
Michael Ahern 1:16:36
How does sustainable finance work for mission rock, we did not certify, or we didn't get climate certified bonds for the mission rock system, we just issued traditional debt to finance that system. So that was about as short as I can do.
Bridget Flynn 1:16:51
Perfect. Another announcement is that right after this, we'll be we'll be heading to the reception. So that will start at five o'clock. This also ends at five o'clock, meaning we will all Usher ourselves over out these doors to the art museum. It's a beautiful, so please look out for signs and or every the flock of other people headed in that way. So I think with that, yeah, if you? And
Dave Karlsgodt 1:17:19
it really should, we would have the drinks before the performance. But that's alright. But Rob, take us home. Just a couple of thoughts, closing thoughts and rundown here. And one
Rob McKenna 1:17:28
final thing, from my perspective is we work a lot of institutions, the operating dollars, don't speak to the capital dollars very well. And so getting I mean, that's why you need these champions, getting getting people to be able to reconcile that. And so that the operating dollars can speak to the capital bars, and you can get projects like this done because you're saving, operating spending more on capital. And those two need to reconcile at some point. Well,
Michael Ahern 1:17:52
I like to just reiterate something that Martha one last reference to you. Student engagement is such an important part of of both the planning process as well as implementation, Bridgette when she was at Oberlin was was phenomenal at leading and driving our student engagement. But it's we were in classrooms speaking with classes, we integrated the geology department, and I know Dan, Oh, you didn't fit that fantastically. At Smith. We had tabletop sessions, we led community tours, student tours, we and we're continuously doing that, just to continue to educate and inform both the community and the student body on what we're doing and why. And not just trying to push that information all but as Martha said earlier, going into the all different types of forums that that this will attract students to actually come and listen, and then be able to communicate with their peers about why there's a big hole in the middle of the campus.
Elizabeth Drake 1:18:54
Indeed, I think I'll just close by talking a little bit about kind of what we've learned after approval, I think we've spent a lot of time today talking about what it takes to get kind of a plan approved and into implementation. But I think the the learning really doesn't stop there. And we've learned so much internally about how to implement a project like this since our borrowers approved it in February 2021 losing track of my years at this point. But I think like once we finally got approval for this project after years and years and years of planning, we kind of had this like oh shit moment of like, now we actually have to do it. And we've learned a lot in the past two years about actually having to do it about you know, how do we manage a project like this? Like we don't have the capital planning resources internally to manage this kind of thing? How do we communicate it? How do we figure out the phasing plan? Who do we need to hire to do the different pieces of this project? All of those things that we really had to I think learn internally after we actually got the approval to get us to the point where last month we Actually, you know, put a shovel in the ground and started drilling geoexchange wells, it was kind of a two year process to actually even get there. So I would just say for anyone that is sort of at that stage, I think Swarthmore is really happy to be a resource and kind of share the lessons that we've learned through those kind of post approval years of actually getting a project like this off the ground. So happy to be a resource.
Camille Kirk 1:20:21
Thanks. We'll call you up. We're learning our own sets of lessons. And likewise, we'll be happy to share. I think the thought I'll leave everyone with today is I think we heard through some of the questions that there's frustration, and some maybe sometimes you feel like you're you're beating your head against a wall, I want to encourage you all to remain reality based optimists. You will have struggles things will go wrong, construction schedules will slow down, things will be over budget, there will be arguments between your planning folks and your your delivery folks who agreed to what and who's paying for what all of these are temporary hurdles in the long game of fighting climate change. And using the higher education mission to do so remain reality based optimists love it.
Dano Wiesbord 1:21:13
Oh, that was really good. You know, they're fine, fine schools find other institutions that are in your eco region, right? There's no, right. There's no secret that the climate in California is different than it is in Massachusetts, find schools that have a like that have a climate that similar to yours. There are VPs of operations and facilities, there are Executive Vice President of Finance, who believe in this who've done this. And we should be able to transfer that knowledge across our institutions. That's how we can use you know, collaborative action to have an impact.
Dave Karlsgodt 1:21:50
So I will close by just first of all, saying thank you to our panelists for such a great insights and rollin with my crazy jazz analogy with that sort of work, whatever. Thank you to Bridget, who put this really was instrumental in putting this panel together. And, you know, I know this was a panel, she could have been on it. She's still been at Oberlin, I suppose. So. We were glad for her leadership here. Thank you to second nature and Ibn for putting this program together. We are the people making the decisions to move this stuff forward. And this is where it's happening. So, you know, I hope everybody gets a chance to talk to panelists and I'm happy to answer questions myself, but just an honor to be here. Thanks for spending your time and we got 50 seconds to go go have drinks. That's it for this episode. Our theme music under the radar comes courtesy of Dallas based musician and arranger geo Washington right in his studio big band. You can find us on the web at Campus energy podcast.com. We are also on the site formerly known as Twitter at energy podcast. If you want to follow us on LinkedIn, search for campus energy and sustainability podcast. If you like what you hear, please tell a friend or share a rating and review on your favorite podcast out. As always, thanks for listening
Transcribed by https://otter.ai