Part B
Requirements and Specification
Version 3 February 2017 (A743635)
TABLE OF CONTENTS
1. Introduction 3
2. Scope 3
3. Financial calculations 4
4. Calculation of greenhouse gas emission 5
5. Calculation of energy cost savings 5
5.1 Baseline Consumption 6
5.2 Baseline Utility Rates 6
6. Calculation of maintenance or other savings 7
6.1 Small-scale Technology Certificates and Large-scale Generation Certificates 8
7. Performance 8
8. Measurement & verification of energy Savings 9
9. Contract site(s) / location(s) 10
10. Confidentiality 10
11. Glossary 10
12. Appendices 11
Appendix A - Facility Description 11
Appendix B – Technology-specific Product Specification and Quality Disclosure 12
B-1: Commercial Lighting 12
B-2: Solar Photovoltaic 13
B-3: Low-flow Showerheads and Taps 13
1. Introduction
Three Tenderers from the South Australian Government’s list of pre-qualified Energy Services Companies (ESCOs) have been issued with this RFP document, and are invited to prepare a proposal that addresses energy efficiency at the following <number of> facilities:
List site name & address
2. Scope
The proposals are an opportunity for Tenderers to demonstrate their ability to provide the services required. The proposals should include details of the Tenderer’s abilities, and methods used to design, document, install, project-manage, commission, and monitor and verify the Energy Conservation Measures (ECMs) and Demand-Side Response (DSR) opportunities.
· Proposals should clearly list and describe the ECMs and other opportunities that were identified through the RFP process.
· Proposals should be structured as described in Part D of this RFP document.
· Proposals will be evaluated by the categories listed in Part A of this RFP document.
The proposal will demonstrate how project delivery, ongoing support and maintenance will be integrated with the SA Government’s facility management arrangements, as outlined in the document “Facilities Management Services Arrangements 1 July 2015 to 30 June 2024” – available from:
http://www.dpti.sa.gov.au/__data/assets/pdf_file/0003/164415/agfma_brochure_2015-2024.pdf.pdf
The proposal will clearly define a schedule of responsibilities for the Tenderer, the South Australian Government and the Government’s facility management contractors.
The requested proposals are intended to provide SA Government agencies with the ability to select the most suitable Tenderer to provide energy conservation measures at all <number of> facilities.
The most suitable Tenderer, determined by evaluation of the proposals as described in Part A of this document, will be invited to perform a Detailed Facility Study (DFS) of all <number of facilities> under a DFS Agreement, with the expectation that the Tenderer will subsequently implement all proposed works that meet the Principal’s criteria under an Energy Performance Contract. The draft DFS Agreement and draft Energy Performance Contract are provided as Part C of this RFP document.
Proposals will be assessed on compliance with this Specification and in accordance with the Evaluation Criteria listed in Part A of this RFP document.
As with the eventual EPC project scope, the total of all proposed solutions must meet an average simple payback period of 7 years or less for the project as a whole.
Tenderers are encouraged to maximise the scope of savings, in particular greenhouse gas, delivered by the proposed solutions whilst remaining compliant with the required 7 year payback period.
The preparation of proposals submitted in response to this RFP should be based on the conducted site audits and other relevant information provided by the Principal to the Tenderers during the RFP stage.
Proposals are to be structured as shown in Part D of this RFP document.
3. Financial calculations
The required average seven year payback period is to be calculated using the simple payback method:
Total Cost divided by Total Annual Savings must be equal or less than seven (years).
Where,
A. Total Cost must be inclusive the total cost of all proposed ECMs, the DFS fee, measurement and verification fees, all associated project costs (including DPTI Project Delivery Costs and Construction Contingency Costs), any increase in annual costs associated with the project (e.g. additional maintenance costs). Total project costs must not include any requirement for further expenditure or additional works paid for by the Principal.
B. Total Annual Savings represents the sum of all guaranteed annual cost savings derived from proposed ECMs, maintenance savings, and other technologies.
C. Total Cost and Total Annual Savings must be inclusive of GST. However, for the purposes of estimating the budget impacts these amounts would need to be separately identifiable.
Note that the simple payback calculation should not use discounting and escalations of project costs or savings, and does not require calculation of Net Present Value or Internal Rate of Return for the purpose of this RFP. These will be included as a part of the DFS agreement.
Any avoided capital expenditure must not be considered as part of the Total Annual Savings.
DPTI Project Delivery fees of 4% must be included in the Total Costs. This percentage is based on the Total Project Construction Costs, which includes:
· Detailed Facility Study cost
· Equipment cost
· Installation cost
· Other project costs e.g SAMIS updates; insurance, document preparation etc
· The M&V cost and maintenance costs during Defects Liability Period as part of the construction contract
The Construction Contingency Cost of 5% is used for calculating the Total Cost and also must be included in calculating the payback period. It is not a real cost at this stage but must be factored into the financials.
The Tenderer is required to provide ‘open book’ pricing, clearly stating applied margins, to ensure that consistency of pricing principles is maintained between the RFP and DFS stages of the project. The proposal should include details of the pricing principles used and how they will be managed and communicated throughout the project.
Tenderers should ensure that pricing for works implementation reflect the requirement for proposals to minimise disruption to normal operations (which may require works to be scheduled after hours or with additional supervision) at the facilities included in this RFP. Contractors should liaise with the Principal’s Contact Officer to confirm implementation timelines and other requirements for works implementation.
4. Calculation of greenhouse gas emission
Calculation of greenhouse gas emissions should refer to the South Australian emissions factors in the published National Greenhouse Account Factors relevant to the year of data, and include the sum of Scope 1, Scope 2 and Scope 3 emissions for each fuel type.
5. Calculation of energy cost savings
When determining solutions, the consumption data provided in Table 1 should be used as a guide when preparing proposals. Calculations for energy cost savings should be based on the electricity and gas rates provided by the Principal in Table 2 below.
Tenderers should use the appropriate rate for energy savings (e.g. peak or off peak depending on when the savings are achieved) to ensure both the proposed energy savings (e.g.in kWh) and the proposed energy cost savings (in $) are accurate.
Note: Tenderers should not rely on a ‘blended’ electricity rate (i.e. an average of peak and off peak) to determine cost savings from proposed initiatives.
For gas rates, Tenderers should apply the correct band rates to determine gas savings. Initial gas savings should be calculated using the upper band rates and move towards the lower level band rates as further gas savings reach band limits. This is to ensure financial savings are accurate.
Peak demand reductions
Tenderers should separately account for any cost savings resulting from a reduction in peak energy demand and should explain the methodology by which demand reduction savings will be achieved and verified. E.g. as a result of various energy efficiency upgrades, the Tenderer may propose to negotiate a reduced peak demand with the energy retailer on behalf of the Principal, and will guarantee that this new peak demand is not exceeded.
Note: Tenderers should not include peak demand costs within a blended electricity rate to determine cost savings.
5.1 Baseline Consumption
Table 1 Baseline Consumption
Site name/ address / Electricity / Gas Consumption (GJ)Peak (kWh) / Off-peak (kWh) / Total (kWh)
Site 1
Site 2
Site 3
Site 4
5.2 Baseline Utility Rates
Large Market Customers
These rates are projected unit rates to be used as the baseline energy rates from 2017 onwards. They are developed to reflect the anticipated higher ongoing energy rates as a result of the current South Australian energy market and policy environment. The Peak and Off-peak rates include all items measured in volumetric costs in terms of per kWh.
Table 2 Baseline Utility Rates (Large Market)
Site name/ address / Electricity / Natural GasDemand type/ name / Peak (c/kWh) / Off-peak (c/kWh) / Max demand rate ($/kW/ mth) / Max demand (kW) / Band 1
0 ~ X GJ
($/GJ)
Site 1 / $10.61
Site 2 / $10.61
Site 3 / $10.61
Site 4 / $10.61
Demand charges are to be based on the demand tariff structures from SAPN:
http://www.sapowernetworks.com.au/centric/industry/our_network/network_tariffs.jsp
Small Market Customers
The rates are essentially the published rates available from sources referenced below without any discounts.
Table 3 Baseline Utility Rates (Small Market)
Site name/ address / Electricity / Natural GasTariff type/ name / Peak (c/kWh) / Off-peak (c/kWh) / Band 1
0 ~ X GJ
($/GJ) / Band 2
X ~ X
($/GJ) / Band 3
X+ GJ
($/GJ)
Site 1
Site 2
Site 3
Site 4
Electricity standing offers:
https://www.originenergy.com.au/business/electricity-and-gas/pricing/fact-sheets.html
Gas standing offers:
https://www.agl.com.au/-/media/AGLData/DistributorData/PDFs/PriceFactSheet_AGL195680SS.pdf
6. Calculation of maintenance or other savings
An Across Government Facilities Management Arrangements (AGFMA) exists for the management of maintenance and minor works under $1 million dollars for South Australian State Government buildings. The whole-of-government maintenance management is administered by the Department of Planning, Transport and Infrastructure (DPTI).
Calculations for maintenance cost savings should be based on real costs incurred by the Principal. If Tenderers are including maintenance cost savings within their proposals, they should confirm with the Principal any proposed baseline maintenance costs or assumed unit rates for maintenance (e.g. labour rates for changing lamps). These rates or baseline figures used as the basis for savings should also be stated clearly in their proposals.
Similarly, Tenderers should confirm any assumptions used as the basis for calculating other cost savings proposed by the Tenderers and clearly state the baseline assumptions within their proposals. Tenderers must describe in this RFP how the Tenderers would work within, and extract information from, the existing whole-of-government maintenance management system, in order to achieve accuracy in calculations and Measurement and Verification.
As a guide, AGFMA charges the follow rates on top of the contractor charges as shown in Facilities Management Information System (FAMIS):
Area / FeeMetropolitan Adelaide / 8.5-9%
Regional South Australia / 12%
Additionally, AGFMA charges the following fees for asbestos management:
Area / FeeMetropolitan Adelaide / $95/hr and 10% in project management fee
Regional South Australia / $80/hr and 10% in project management fee + travel time
Furthermore, AGFMA Contract Administration fee of 2% is charged on top of value of works put through the AGFMA to cover the costs of providing contract administration service, quality control, bill paying to contractors, a hotline for receiving work requests, and managing FAMIS.
Where the nature of the maintenance requires highly technical expertise knowledge and is considered to be inappropriate for AGFMA personnel, maintenance services may be undertaken outside of the government’s AGFMA contract. Tenderers should seek agreement from the Principal as well as AGFMA for such circumstances.
6.1 Small-scale Technology Certificates and Large-scale Generation Certificates
STC and LGC pricings for eligible technologies (such solar PV and solar hot water) should adopt the nominated weekly average unit pricing as highlighted below:
Renewable Energy Certificates ($ per certificate Ex GST)SRET / LRET
Spot market trading price 21/2/2017** / $40.00 / $87.80
Assumption for ESCOs to employ for the RFP / $35.00 / $80.00
** Source: http://greenmarkets.com.au/
7. Performance
The intended format of the RFP, DFS and subsequent EPC processes reference the contents of A Best Practice Guide to Energy Performance Contracts, produced by the Energy Efficiency Council. It is recommended that all parties involved become familiar with this document.
Performance of the existing facilities and equipment must be identified and clarified to the Principal, accompanying the proposed ECMs, as per Type 2 Audit in Part 1 AS 3598.1:2014.
The EPC Manager for this project is required to either have achieved a certified status from the EEC’s Energy Efficiency Certification Scheme, or demonstrate that obtaining such accreditation is in progress. Further, the day-to-day contact personnel must be the EEC accredited EPC Manager (to be nominated by Tenderer in Part D Response Schedule of this RFP).
Product Specification and Quality
Tenderers must disclose product information to demonstrate that the nominated product or equivalent is able to achieve the payback period calculated. This includes warranty, specifications on the maintenance and replacements including expected costs, associated time periods, and the responsible parties.
Where the proposed ECMs consist of products regulated under the Greenhouse Energy Minimum Standards (GEMS) and has energy labelling, the nominated product or equivalent must be demonstrated to be registered by supplying a product approval certificate, and/or obtained a high star rating for its capacity and category if the product is energy labelled. For a list of current regulated products:
http://www.energyrating.gov.au/suppliers/registration/regulated-products
Where the ECM consists of product types included in the South Australian Retail Energy Efficiency Scheme (REES), Victorian Energy Efficiency Target (VEET) and/or the New South Wales Energy Savers Scheme (ESS), the nominated equivalent product must achieve both the product and installation requirements of one the Schemes.
http://www.statedevelopment.sa.gov.au/resources/energy-efficiency/retailer-energy-efficiency-scheme
http://www.ess.nsw.gov.au
https://www.veet.vic.gov.au
Tenderers are to refer to Appendix B for technology-specific product specifications and performance requirements. Note that this list may increase depending on project needs.
8. Measurement & verification of energy Savings
While M&V strategies will be project and site specific, in general, the South Australian Government has a preference to use the following M&V options: