Energy efficiency is widely recognized as a preferred GHG emissions reductions strategy at the UC’s due to the potential to reduce utility expenditures while lowering emissions. Funding, however, is often perceived as the limiting factor with regards to implementing energy efficiency projects at UCSB. In order to institutionalize a reliable source of funding for energy efficiency projects at UCSB, Facilities Management proposed the creation of a Utility Conservation Revolving Fund (UCRF).
We evaluated the funding potential of the UCRF through 2025 with a scenario analysis and determined that the UCRF can serve as a key tool in providing substantial funding for energy efficiency projects on campus. We performed a scenario analysis of UCSB’s proposed UCRF to evaluate the impact of varying utility escalation rates, project payback periods, and utility incentives on UCRF performance over a 2025 timeframe.
Results of our scenario analysis estimated that the proposed UCRF structure will deliver between $10.4 million to $24.2 million in cumulative utility savings as well as a 15 to 31% reduction in Business as Usual (BAU) Scope 1 and 2 emissions at UCSB in 2025. In our report, we also provided best practices and key lessons from case studies of green revolving funds at other institutions to demonstrate proof of concept and possible performance.
How a utility conservation revolving fund functions: savings from energy efficiency are put in a revolving fund to provide capital for more energy projects
- Identify additional energy efficiency projects to be implemented through 2025.
- Develop strategies to overcome Facilities Management staff constraints.
- Consider sharing UCRF-generated savings with other campus budgets in order to build buy-in for the UCRF with the Office of Budget and Planning.
- Learn from other universities that have successfully implemented GRFs.
If the UCRF is implemented, we recommend that the campus focus on addressing other constraints such as insufficient staffing within Facilities Management as well as the need to identify and plan additional energy efficiency projects.