Mitchell Simpson, associate director of the Arkansas Energy Office, called the project "both an economic development tool and a model for forward-thinking cities and counties across the state."
Sebastian County just spent $5.1 million on energy-efficient lighting and air, as well as water-saving systems at its golf course and detention facility, all without spending a taxpayer nickel up front.
Working with national contractor McKinstry Co. LLC and several local subcontractors, the county took advantage of the relatively new Arkansas Energy Performance Contracting program, which allows state agencies, colleges, cities and counties to pay off retrofit projects over time with the savings from their utility bills.
It was the first Arkansas project for McKinstry, which is based in Seattle but has its Southern Headquarters in Dallas, but it won’t be the last. “We’re bidding on other projects and planning to make additional hires in Arkansas because of the [AEPC] program,” said Michael Grabham, regional director for McKinstry South. The company, which has national annual revenue of $550 million, provided new LED lighting, building management systems and boiler replacements at several county buildings, the Adult Detention Center, the Fort Smith and Greenwood courthouses, the Sebastian County Courts Building.
“Sebastian County is the second to take advantage of this program, which is offered through the Arkansas Energy Office,” Grabham told Arkansas Business in a phone interview. “This program caused our firm and many others to invest and hire in Arkansas. It’s an economic boon to the state, and a great deal for counties and taxpayers.”
Since 2014, the program has launched 13 projects guaranteeing more than $120 million in utility savings, and the finance mechanism lets public units “complete a comprehensive set of energy efficiency, capital infrastructure and renewable energy measures at now upfront costs,” the AEDC said. Pulaski County was the first in the state to retrofit its buildings through the program.
The latest project gave the western Arkansas county “more efficient HVAC lighting systems, which resulted in reduced energy costs across our buildings,” Sebastian County Judge David Hudson said. Mitchell Simpson, associate director of the Arkansas Energy Office, called the project “both an economic development tool and a model for forward-thinking cities and counties across the state.”
McKinstry, which has about 2,100 employes at 30 offices across the country, specializes in retrofitting existing buildings with advanced mechanical, electrical and lighting systems. “Anything that uses energy we assess and improve, and the building owners see the savings,” Grabham said. “The public sector sees particular value in this sort of equipment replacement because they have long-term plans to be in their facilities. Sometimes private businesses are more reluctant to look that far out, but the county can expect to be in those courthouses for 50 years.”
With utility savings of some $344,000 a year, the project will be paid for in 15 years, Grabham said. “It’s our first project in Arkansas, but the state is a strategically important market for McKinstry. As south regional director, Grabham also oversees projects in Texas, Oklahoma and Louisiana.
“We do use local subcontractors,” Grabham said. “That’s a winning strategy for our industry and the best way to support local and rural communities. In this case, we worked with the county to use their regular partners, and more than 50 percent of the work was completed by local contractors.” Powers of Arkansas, based in North Little Rock, did significant work on heating and air controls.
“We did a full LED lighting retrofit, installed new digital control building management systems, replaced several large HVAC systems and numerous smaller ones around county, and did water conservation projects at the county-owned golf course and jail facility,” Grabham said.
The total project included about $1.8 million in jail improvements, some of which were beyond the original scope of the project, but county officials said the changes will improve jail facility planning in the future.
Katie Lanie Niebaum of the Arkansas Advanced Energy Association said the energy performance contracting program has been a top policy priority for her organization “since our members helped secure its passage in 2013.” The law was updated to include counties several years later.
“The AEPC program is creating jobs, saving taxpayer dollars and conserving energy,” Niebaum told Arkansas Business. “The explosion of interest … in four years of the program’s operation shows how valuable an economic development vehicle this program has become in a short period of time.”
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