COUNCIL OF THE CITY OF PHILADELPHIA JOINT COMMITTEES ON THE ENVIRONMENT AND STREETS AND SERVICES Room 400, City Hall Philadelphia, Pennsylvania Monday, June 14, 2010 2:20 p.m. PRESENT: COUNCILMAN JAMES KENNEY, CO-CHAIR COUNCILMAN CURTIS JONES, JR. COUNCILWOMAN BLONDELL REYNOLDS BROWN RESOLUTION 100291 - Resolution authorizing City Council's Joint Committees on the Environment and Streets and Services to hold public hearings to investigate the benefits of installing energy efficient Light Emitting Diodes (LED) streetlights... - - - 2
Good afternoon, ladies and gentlemen. The Committee on the Environment and Streets and Services is now in session to hear testimony on a resolution. This is no 7 need for a quorum today. There will be no action taken on any legislation. This is an informational hearing, and hopefully we can develop a strategy going forward. In the presence today is Councilperson Blondell Reynolds Brown and Councilman Curtis Jones. This is a resolution 16 authorizing the City Council's Joint Committees on the Environment and Streets and Services to hold public hearings to investigate the benefits of installing energy efficient Light Emitting Diodes (LED) streetlights, reducing annual energy payments associated with streetlights, encouraging local manufacturing of LED streetlights, and financing capital purchases with proceeds 3 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 from energy savings. Please identify yourself, whoever wants to begin, for the record and proceed with your testimony.
My name is Edward Neely. I'm here representing Anaconda Enterprises.
We're here to discuss today or give you the background on who IntenCity and the fixture that we're looking to work with the City. We're here to discuss the fixture we'd like to work with the City to replace the street lighting with, and we have the owner of the company here as well to discuss the background of the company and the light itself. And then I will be covering our future plans to go forward with the City and what we'd like to do 4 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 here in the City.
Okay. You can identify yourself each individually and then start, whoever wants to start the testimony.
Peter Wernsdorfer, Municipal Streetlight Services, and we're here to assist Mr. Neely and Mr. Bruck.
Mike Bruck. I'm here with IntenCity Lighting to discuss our technology and our lighting system basically compared to existing lighting systems and to our competitors.
Again, we are IntenCity Lighting. Not many people have heard of us. We're not GE, we're not 5 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Philips or those kind of people, but we do have a strong electronics background, which this new light is. The technology is no longer a bulb in a box. It is electronic. It's solid state. It has been somewhat in its infancy, as some people have said, but it has matured very, very rapidly to general lighting. To give you a little bit of background, we have another company, sister company, called Electronic Fabrication Services. We have for 15 years built very high reliability 16 electronic systems for heavy equipment, 17 for automated pharmacy equipment. We've 18 done -- in fact, I noticed some parking 19 meters here in the City of Philadelphia 20 that I probably built that are probably 21 being aged right now, because they've 22 been built for a long time, but computer 23 equipment, things of that nature we've 24 done. 25 And we recognize that the LED 6 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 technology in lighting was more of an electronic issue than a lighting issue. There are certain things that have to be done properly to make this thing work like it should and last like it should. So we've got kind of a presentation here about our design philosophy and how to build this. We've also been in this business probably as long as anybody in the LED business. We started this project five years ago. So we've made a lot of the mistakes. We've seen the pitfalls. We know where all the problem areas are that a lot of even larger companies now are just now beginning to recognize. The issues to be addressed in building something like this are basically fourfold. You have to have the proper optics to use all of the available light to you. Currently, most of the lighting is not energy efficient. It never was intended to be energy efficient. Energy used to be cheap, so 7 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 you just put enough power into it, you make enough light, you spray light out there and you did the job. Today people are much, much more conscious about that energy usage. So what we do is, we take the LEDs and we -- by their nature, they help us, but we focus that light where we want the light. We put all the available light where it belongs. That way, we become very much more efficient and we use much less power than even just the LED alone spraying light out. Thermals are a huge issue. LEDs do not radiate heat like a bulb. It has to be conducted away from the LED. That's the reason you see a lot of heat fans and things like that. If you could back up just a little bit, Ed, and I'll go into more detail on some of this. The electronics, again, it's not a bulb in a box. There is electronic circuits here involved. And the 8 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 mechanics of it, it all has to fit together and work properly and mount on your poles properly and everything has got to have kind of a symphony of things working together to make it work properly. I'm trying to read this also. They are small directional points of light, and what that enables us to do is, like this fixture here, is to build a much smaller fixture than what you're doing and control the light much better. A typical HPS fixture, if you were to control the light the same way, you would have to have a five-foot reflector. So the small points let us in a small package take care of that issue. This is kind of a part of our patent application here. This lighting reflector system is now patented and its method of manufacture is patented. It's got a sharp optical cutoff also. This particular design -- and we can vary it, the reflectors, for 9 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 different designs, but this particular design is made to put all of the light in the street and not in your windows. So we got a sharp cutoff at the sidewalks. That way, we're not making yard lights.
We're trying to make streetlights, in other words. Here is a comparison of our pattern versus a typical HPS pattern. You can see that it is much more controlled and does have that cutoff that we're talking about. The HPS has a lot of light that goes back behind the light on what we call the house side of the light. )
The stenographer won't be able to hear you, so as he points out, could you explain what he's pointing to.
That right there is the HPS fixture, and where he's pointing is basically right under the fixture. 10 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Notice that the lines that come down below, that's light that's coming behind the fixture, and they are very far apart, which means there's a lot of light levels back there, where ours is much closer, the lines are closer together, which means that the light is dropping off much more rapidly back behind the fixture itself. So an HPS may have more lumens in the total fixture, but we are much more controlled. We put the light where it belongs. This is also some of the things that we can do with different patterns. We can put the light in different places with different reflectors. Thermals are a huge issue in this business. Again, they can't effectively radiate the heat. So we have to design a heat reduction system that will work and maintain the life of the LED. There's a lot of LED solutions out there today. There's a lot of junk out 11 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 there, but a lot of it is because they are not managing the thermals properly. Something that a lot of these people haven't thought of yet is the solar loading of an LED. LEDs can be damaged due to high temperature even when they're not on.
Can, if not properly maintained. If you look at our heat sync design, this is a profile on the thing of our actual heat sync here on the light. We have fins not only on the top that radiate the heat when it's on, that becomes a solar collector during the daytime, but we have heat fins on the bottom that will radiate that heat away from the LED during those sunlight loading times, and we have proven that that does work, and we do have a patent on that now also. We do have LM-79 testing, which is third-party testing that gives 12 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 performance specs on our light. We are ETL for safety. A lot of this stuff is not going to mean anything to you. It's high power factor. The engineers and all that can get into the discussion of the technical part of it, but we do have quite a bit of third-party testing that's totally independent of our own tests. The mechanics of it, everything external here is either anodized aluminum or stainless steel. We decided we want to build a fixture that's going to outlast the LEDs. All of the infrastructure and everything has to withstand that test of time also. The lenses are polycarbonate UV stabilized so that sunlight doesn't degrade this for many years. It's a very low, what we call, an effective projected area as far as wind loading. We have tested this in a wind tunnel at 150 miles an hour, with no movement whatsoever. We didn't go past 150 miles an hour, so we thought 13 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 that was sufficient. In fact, it's hard to find a wind tunnel that will go past that, but... The reflectors are made of highly polished anodized aluminum. The reflector itself material has a 20-year warranty on it that the manufacturer gives us. Everything is sealed as far as the light engine is concerned. That is very important, because LEDs can be affected by moisture, so we make sure everything is totally sealed for moisture. We've submerged these things. We've done testing like that to make sure that we don't have that. That means that unlike a typical fixture, we're not sucking dirt up inside the lenses. We're not losing our efficiency on the first few months just from automotive fumes, dust, dirt, that kind of thing. And it's very lightweight compared to a typical fixture. A typical HPS fixture is around 30 pounds. This is 15 pounds. 14 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 The mounting mechanism is proprietary to us. As you see, it fits up inside the arm or pipe, and basically -- I don't know if you can point to it, Ed. There's a knob that gets turned and there's an expansion joint that then expands inside the pipe and locks it in place, and that was part of our wind tunnel testing also, that that mechanism will withstand that kind of loads.
On the typical streetlight that we have now, what would need to be changed in addition to the fixture itself? What would it plug into?
You can extend it out on the existing pipe, typically is what happens. You take the old fixture down, you put this one in and attach three wires. 15 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
There's only three Councilmembers here, so if they want to jump in and get some illumination on your -- illumination. I did not mean that.
-- (continued) on what you're saying or some clarification, that would be helpful.
Thank you, Mr. Chairman. This is the first time I've heard you give a joke, so I'm -- really good. Listen, I'm impressed. Couple of quick points. Have you done comparisons per unit cost versus our existing units? What are the cost comparisons?
I don't have that 16 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 necessarily with me as far as your exact lights. I don't have that information yet, but we can do that for you.
We'll probably get that from the Commissioner, if indeed she's going to testify.
Typically the initial cost is more expensive, but the payback is very quick also.
By way of maintenance, have you done any maintenance comparisons to what our existing light fixtures are?
Not your existing fixture again, but once we know more about your systems here, we can do those comparisons for you, and we probably 17 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 would need data from you also to do that properly.
So we have not gotten to the point where we've done apples to apples comparisons of these? This is early in the process.
This is the beginning, okay. So by way of maintenance, what has been your experience? Are you in other cities at this point?
We've done tests in Los Angeles. We've done tests in Houston. And these are progressing on also. Sitka, Alaska; Oakland, 18 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 California. Do we have some in the City, Tom? Stanford. We're doing a deal with Stanford now, Connecticut. So we've got quite a few out there. We've got about 4,000 fixtures in the field right now.
This is incredibly interesting. Thank you very much. Councilman Jones touched on a few questions. One is your experience in other municipalities. So we will look with interest to the yield of those potential contracts. The break-even point would be 19 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 very, very useful. We recognize, most of us on this committee, that when you're looking for energy efficiency, thinking about going green, the output on the front end is what it is, but given the long-term implications make it indeed worthwhile and beneficial. So you say you have something pending in Stanford, and you've named a number of municipalities. Are those opportunities at different stages of development?
They are at different stages. I didn't mention North Little Rock, which is one of our local ones also that has done a lot of testing for us.
So talk that through. You say they're doing testing. What does that mean?
They're basically putting up fixtures from a lot of different people, even other technologies, and just trying to evaluate 20 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 the whole setup right now.
One of the things that we've done, though, we adopted this early, so that, again, we've gotten a long way down the road compared to a lot of people, and we've developed a unique technology, we think. What we've done is started at the LED and the physics of the light and the LED and worked our way outward to build a fixture that works properly. A lot of people in here now are just throwing LEDs on something and trying to make it work. Time will tell as to how those will work. We can predict it, but to the general public, time will tell.
And of those potential opportunities, which one is close to closure, an actual contract?
Stanford, Connecticut is probably the closest. Behind it, North Little Rock, Arkansas. We think maybe Houston. I'm talking to 21 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 my national sales manager here.
And when you look at the Stanford, Connecticut opportunity, how much lead time, planning time went into the ultimate hopeful culmination of the deal? UNIDENTIFIED SPEAKER: Over 13 months. 14
Just real 17 quick followup. Is there a solar 18 component to this?
There can be. Solar is difficult in that you have to deal with more than just solar. You have to have battery systems that back that up 22 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 or work in conjunction with it.
So you got to charge the batteries during the daytime, use the batteries at night. The battery technology is the key component there. It's just not quite there yet as far as being affordable. The batteries that we've looked at that would power this light properly are about twice as expensive as the light itself.
We're working on a project right now for solar and wind, but it's for Haiti where you're in the equator zone with lots of wind, lots of sunlight.
You can 23 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 proceed with your testimony as you were giving it, continue with the presentation.
Okay. Basically we're getting into our current products here. We have different outputs of the streetlights. We build parking garage lights. That's probably our biggest installations right now, is in parking garages. We've done several medical centers. Can I mention some of those, Tom? (Witness speaking without microphone.)
Albany Med has just signed on with us. Berkshire Medical, we've done all of their parking garages to date. Albany, New York Airport, Albany Airport, we're going to do the roofs and the parking lots. The parking lots are basically the streetlight. 24 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Con-Ed is working specifically with garages right now, towards that anyway.
We build also a wall pack unit, which is this unit here. That would work well in parking garages, stairwells. It also works well in tunnels. And I understand you have a lot of tunnels in this area that we could light up that way.
One of the questions offline before we started our official hearing was the color combination that might indicate an Amber Alert or indicate danger or indicate directional patterns that pedestrians and vehicles needed to go in cases of emergency. Has there been some thought given --
There hasn't been anything done yet there, but it's all very technically feasible to do. It's not that difficult. You can add some colors into this thing to give you what 25 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 you're talking about as far as pathways or emergency exit routes. It's possible to also network these via RF, radio frequency type networks, so that you can have a command and control type situation over your lighting to turn the lights on and off. In fact, we discussed this with North Little Rock in some of their parks. They have a park that is the second largest land area park in the U.S. under Central Park, New York where they want -- we're talking about doing that kind of thing. They wanted to modulate the lights slightly at park closure time to let everybody know the park is going to close, and then they wanted to dim the lights down in the off hours to save more energy yet, but incorporate -- you can incorporate a lot of things if the numbers are there to do it, but technically it's feasible to do all of those things. It's a matter of numbers and cost. General characteristics and 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 benefits, again, life expectancy of LEDs if they're done properly -- I'll say that if the thermals are done properly and everything is done like it should be are 50,000 hours or greater now, and that's based on what we call a 70 percent lumen maintenance. That means at 50,000 hours we'll still have 70 percent of the output we started with. Energy usage is basically cut in half or better now. LEDs are getting better, so we're getting even better with that. We've seen a lot of good reports on that. City of North Little Rock did a test for us. They put up one of our 5,000 lumen SL 50-watt lights up against a 250-watt HPS. They metered both individually, and apparently the meters don't work unless you get up to a certain level real well and they said, Well, the meter with the LED is broke. It's not working, because it's not registering enough. So the head of the Streets said, 27 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Go out there and change that meter. Well, the guy went out there. He didn't change the meter. He swapped the two. Now the other meter is broke. So basically they couldn't register it. They were saying about one-fourth in that particular test. Not all LEDs will meet that, but it's 50 percent or greater. I don't know where I was, Ed, on that. Light quality of an LED in this case is a white color rather than the orange glow that you see from an HPS. That in itself gives you much better visibility under the light. Even though the lumens are not there, just due to the white lights, you can see colors properly. It works excellent under security cameras, and I think we may have some slides of some before and after's. Security people love it because they can see under their security cameras the colors of cars, the clothing that people are wearing. It's actually visible now. 28 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 This is kind of a comparison chart that -- it's probably a year old comparing efficiencies of LEDs with other technologies, and there has been a report that was just put out by the DOE that says that on average, LEDs are percent 8 more efficient than any other 9 high-intensity discharge lighting on the 10 market today, and they did a comparison 11 of average of a lot of different lights. 12 And that's coming directly from the 13 Department of Energy. 14 This is a typical graph of 15 savings of HPS over LED, and basically we 16 have a calculator where you can plug in 17 your electric rates. You can plug in 18 your maintenance costs, the cost of the 19 fixtures, all of this kind of stuff, and 20 it will actually give you the payback in years of what it takes to pay back and actually pay for the lights.
This is a similar concept to an individual residence or business that does an energy 29 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 audit and determines what needs to be done to improve the energy efficiency of the building and then uses those savings to finance the work itself.
And are all of the subcomponent parts pretty much American?
Pretty much they are. We do meet the Made in America Act requirements, and we're moving more and more in that direction as time goes on. Some of the things we are getting now are overseas, but some of the parts, electronic parts, up until recently weren't available except from overseas, but we are now working with more and more American companies as they become available.
Perhaps if 30 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 it's part of your testimony to discuss, I don't know if this is the appropriate time or not, the potential manufacturing opportunities in the event that there is a source of need in this region that maybe you could --
We are in discussion right now with Anaconda Enterprises about doing a final assembly plant in the local area if the numbers make it reasonable to do so.
If the demand is there, then you can manufacture them here?
And also the workforce that would potentially be working there, this is a process that people can be trained to do?
Yes. As far as final assembly, yes. We would maintain as far as the technical aspect of the light engine, because that's our expertise and keeping the quality where 31 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 we want, but as far as taking those pieces then and producing it into various forms, we don't have a serious problem with that at all.
And one of the initial discussions that I had with the rest of the folks when we first met was that there would be no problem or would it be encouraged to consider people who are reentering the workforce after incarceration that that's the kind of a position or manufacturing job that's very trainable and that folks could do and make a decent living. So the potential down the road would be not only increased street lighting -- better street lighting, a savings on electric, manufacturing it here and employing people that are difficult to employ and getting them back on their feet. So that's all -- they're all doable issues?
Yeah. These are things that Ed and his team are working on here locally. 32 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
Mr. Chairman, that sounds like a stimulus package to me.
This is a photograph of a street in North Little Rock that we did. These poles are actually higher than what we recommend, but you can kind of see the color rendering underneath. You can actually see the colors in the flag and the car and clothing, things like that. Under an HPS fixture, you would see yellows and browns basically and not the other colors. It's got a very low profile once you get it on a pole. It looks strange and all that up close, but when you get it 35 feet in the air, it virtually disappears. This is a parking garage. This particular garage is in Pittsfield, Massachusetts at Berkshire Medical Center. They're spaced a little bit 33 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 further than we liked, but that was their requirement and the customer was happy, so we were very happy with it. This is the wall pack in a stairwell. And I don't know if you can tell from this slide, but concrete stairwells are kind of bland, but there is a fire alarm thing there that's red. You can kind of see how the red color actually shows up in this. These are various things here. On the -- see, that's a before of AMRI. That's AMRI in Rensselaer, New York. That's a parking lot with high-pressure sodium, and then on the right is the same parking lot with our fixtures. And you notice how the trees in the background all the sudden show up green and all of the colors start coming out where you can actually see. The security people loved it after that. They said this is the first time they've ever actually seen anything in their security cameras. 34 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 That one I believe is in North Little Rock. That's one Tom put up somewhere else. On the right is a university parking lot, Oleana.
Do the elevation of the actual poles that they're attached to, do the tests still bear out at varying heights?
You can -- with the electronic data and files that we have, you can predict what you will get at various heights. That's very easy to do. It will affect the spread. That's one thing I didn't mention about our streetlight versus probably 99 percent of everybody else out there doing LED. You notice our LEDs are pointing outwards, not straight down. The hardest part to light is the longest distance, and so what we did was, we pointed the LEDs at the hardest place to light up and then we used the reflector system to fill in underneath. So we get a much broader spread. We're not as bright right under 35 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 the pole as everybody else, but we've evened that light out where you get a more even light throughout the whole area that you're trying to light up. We're putting light out 60 to 80 feet, depending on height, away from the pole, usable light. So we're not building flashlights. We're not trying to just light a spot. We're trying to light an area with this. These are some -- one of the things that we can do in parking garages, tunnels, indoor things especially, is actually predict what it's going to look like before we ever do anything. We'll take the third-party files, electronic files that have been made, not by us but by a testing laboratory, and put that into a computer program and actually predict what all the light levels are going to be before we ever put a system in. We can verify that the system is going to work before we ever put the first light up. 36 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 That's the computer-generated model right there of what we were going to see at Berkshire Medical. And if you back up, Ed, there's the actual photo. So it's very, very close to real world when we do a simulation.
Would you be willing, with the cooperation of the Streets Department, to maybe pilot a street or two in the City --
I guess we'll have to have something in the 4th Councilmanic District.
We're At-Large Councilmembers, he's a District Councilperson, so we're not going to get away with not doing something in the 4th, that's for sure. Correct?
Correct. 37 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
We're done then. The other issue is one of installation. We had had initial discussions relative to how they would be installed and by whom, and the team had agreed that in the event that this thing or something move forward, that you guys would be willing to train our District Council 33 folks on how to do it, how to take it apart, install it and maintain it, so that we don't have any feelings amongst our workforce that somehow we're trying to replace them in this process.
We can train the installation in less than 15 minutes. It's very simple.
Okay. Any other questions for this particular witness? (No response.) 38 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
Anyone else who is going to testify? Please, if there's anything else that you have to offer or --
Peter Wernsdorfer, Municipal Streetlight Services. In briefly speaking to Mr. Neely before we came down today, a couple of things about the cost return and your return on your investment in these lights. First, when you assess your costs and you decide -- or you assess the cost of operating the system and the installation and everything else, there are more than just the simple components of people putting the lights on the poles and then turning the switch back on. One is, we're in an era of de-regulated electricity and, as you 39 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 know, PECO's rate caps expire on January 1st, and so you have a whole new scenario emerging I don't know that anybody has addressed, recognizing that no one has really seen where the market will go, but I'll give you some examples, and one of them I'll address in my former capacity as the Director of Public Works in the City of Allentown. And I'm not really sure whether I should be offended that you guys didn't bring up the fact that I tested lights for you, but I'll let it go.
Because here in Pennsylvania we like to pretend we're parochial and the laws of the universe only apply to us. So I just want to make sure we know there is a Pennsylvania firm.
In Allentown, were the lights tested in a residential or a commercial street setting or were they tested in --
Actually in both. We did on the Susquehanna Street Bridge, and I actually have some electric bills and I think Ed has some copies that he obtained officially through the Open Records Act as well, but -- and we also tested them in the Theatre District, and I will say that that occurred after I left the city, but the ones on the Susquehanna Street Bridge is actually one of the last work orders I authorized for anybody to do. But if you take a look at them, there are two components to it. One is that we've significantly reduced the demand -- the actual demand in kilowatts and reduced the number of kilowatt hours burned, and as you'll see, the bill 24 dropped considerably. And it's just a matter of three lights, mind you, but 41 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 it's pretty significant. We're going back to that issue, though. Where the market is going to go in terms of the cost of electricity is actually completely unknown, except that we know it's going to go up. And I think my understanding of it is is that the current costs that you have are modeled on current rates, and I think there's a need to model based just on some projected rates, and I give you some examples. In Allentown, in PPL's region, mind you, on the SE tariff, streetlights, we were buying energy, energy only, the energy component of the bill, at a half a cent a kilowatt hour. After de-regulation, it jumped to 10.12 cents per kilowatt hour. It's a pretty significant change. So when you discuss the issue of cost avoidance being savings, think about where that's going to go and how you model that appropriately, because that's really an 42 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 issue. The other --
I think on top of that -- and I'm not sure. I think the Streets Department can correct me if I'm wrong, but I do not believe we have meters. I think it's kind of an estimated agreement with PECO as to the number of lights, the power that's needed to power them, but I don't think there's any spinning --
There's no 19 spinning meter, so it makes it even a little more subjective. Not subjective, but a little less understandable what's going on.
You're absolutely correct, and even though it's un-metered, though, there are models that 43 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 you can use to address that issue. The other thing is is that as MSS and our affiliated companies, we operate about 70,000 streetlights in the State of Pennsylvania. We have experience in configuration probably that nobody else has. Utilities typically haven't versed themselves in that, because they just went out and put up lights where people wanted them. We were targeting that as a means of cost avoidance. So our belief is that it makes it -- through configuration, we can make LED economically feasible, and we'd be happy to work with the City of Philadelphia and do that.
I think in addition to the City of Philadelphia, I think we need to work with PECO, because they would have to -- in any scenario of cost savings, they would have to buy in to the model and to the number that ultimately comes about, because that's 44 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 either a negotiation or discussion between the City and PECO now. So what I would like at some point in time, if I can get the Streets Department after their testimony to maybe arrange some kind of meeting or discussion of it with PECO to see whether or not based on the number of streetlights we have in every street in the City, what's that number to run it a year under the current rates, what will it be under the new rates and what would they agree to would be savings in the event that theoretically every one of these lights were replaced with LED.
That's correct on a straight calculation basis, but there's also other things you can do in terms of configuration of getting lighting onto the street that allow you to reconfigure how you do that that yield additional cost savings. We know from our experience in doing that that that leads to economic benefit that make LEDs feasible now. 45 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
And it's a multiple-part problem, I agree. That said, I think ideally -- and I think you just expressed it -- that you put the tools into place to give people those means to do that, you can reach a solution that seems not just equitable, that it seems accurate and that gives you those cost savings, and that becomes a method by which because of the cost of LEDs, you can use your cost savings, your cost avoidance as a means of funding the implementation. And we think we have a model that we can assist you with in doing that.
Edward Neely, Anaconda Enterprises. When Anaconda was originally approached, Councilman Kenney, what our approach was then and still our approach 46 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 now is to negotiate a deal with the City to replace the streetlights, and in doing so, if we can get such a portion of the lights that it makes it feasible for everyone, we would be willing to open up an assembly factory here, could possibly be in the Navy Yard, could be one of these type sites where we can reutilize some of that underutilized space, and we're also looking at using ex-offenders, people coming out of incarceration, helping them get back on track and on their feet. We're looking to pay them a very favorable wage and also giving them medical benefits as well. In conjunction with that, we'd also be willing to provide them with training annually in various different fields to help them get their lives back where they need to be so they can help join back into a productive part of society. If the City decided to do a streetlight program with LED, on average 47 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 with our fixture, you're looking at reducing your street lighting carbon emissions footprint by about 60 percent. That's a major reduction in your carbon emissions right now. And on top of that, that 60 percent is also based on the power savings that you'd use. So if you're paying $12 million a year right now for streetlights on power, just on the power side or piece of that alone, you're looking at 60 percent reduction. So this is a win-win for the City and us, we feel, and we feel like we can all get together and make a program that would work for the City as well as for us to make this happen.
Is it your contention as the company who manufactures that there is enough patented items that -- who would be a comparable competitor?
Right now we don't have any comparable competitors that we're aware of, and we're continually 48 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 trying to stay ahead of that game. We have on just this one fixture, we have four patents right now.
And what you had testified earlier to is that the other LED-producing companies or manufacturing companies don't have -- that it's not the same technology?
It is not the same. It's the same LEDs. It's in how we package those LEDs and how we apply those LEDs that is different in this case. From the optic side to the thermal management, even the mechanics, we've done -- again, we started from the LED and taken the physics of what's given us and worked outward to come up with this light that we feel is superior to everyone that's out there right now.
I'm struck by your knowledge base of this, so tell us a little bit about your background. 49 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
My background is basically years in electronics 4 manufacturing and design. There have 5 been other people helped with the design, 6 other engineers. We've got some back-up 7 people right now, but my background 8 specifically is in electrical 9 engineering, design and manufacturing. 10
Thank you 12 very much for your testimony. I would 13 like you to please stay by so that if 14 something is raised during the 15 Administration's testimony, that we could 16 have a discussion about it before we 17 leave. 18
You can 22 just spread out in these chairs here. 23 Mr. Doyle. 24 Right now we've had 25 Mr. Wernsdorfer, Mr. Bruck, Mr. Neely. 50 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Is there a Mr. Masur here? (No response.)
Please. Commissioner, I'm sorry. I didn't realize you were testifying. I just had Mr. Doyle's name. Good afternoon. Please identify yourself. COMMISSIONER TOLSON: Good afternoon. Clarena Tolson, Commissioner of the Streets Department. Councilman, I know that you did not know I was going to be here today.
Nice to see you, though. COMMISSIONER TOLSON: But given the importance of this issue, I felt it was important to be here along with Joseph Doyle, who is more than competent to handle this, as he's a street lighting engineer for a number of years and now 51 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 also our Chief Traffic and Street Lighting Engineer. This issue in terms of innovation is important to the Streets Department. As you know, we have used LED technology for a number of years in our traffic signals, and we've been in the process of converting or just began the conversion of all of our red, yellow and green in our traffic signals. So we find that staying ahead of or with technology is important, not only to our budget but also to our environment. Technology is critical and key to all that we do. I would say that relative to LEDs for streetlights, over the last two years we've probably met with a handful of firms, approximately a half a dozen of firms, to discuss their technology. This is ever-evolving technology, and we certainly would look forward to the opportunity to meet with IntenCity as well. We have not met with them to date, 52 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 but we'd love to meet with them as well to discuss their approach and some of the assumptions that they made within their documentation. Joseph Doyle is going to offer some testimony that probably will delve into more of the technical aspects of some of the issues that are at hand, but we both remain here to answer any questions that you may have. You did offer in your earlier commentary about doing a pilot with IntenCity. We are presently doing a pilot with one company, but we would be more than happy to pilot, do some work with IntenCity as well. This is a very competitive arena, and to the extent that they'd be willing to donate any equipment so that we can test it in the field and work with them on performance and any other issues, we will gladly do that. Thank you.
Thank you. 53 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Please identify yourself for the record.
Joseph M. Doyle, Chief Street Lighting and Traffic Engineer. Councilman, I have some prepared testimony, if I can just read that into the record.
Good afternoon. I'm Joseph M. Doyle, Chief Traffic and Street Lighting Engineer for the Philadelphia Streets Department. The Philadelphia Streets Department owns and maintains approximately 108,000 street and alley lights that currently use high-pressure sodium fixtures. Currently, the City pays approximately $15 million to operate the street lighting system each year. The development of LED technology has steadily progressed from residential lighting to commercial and 54 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 industrial lighting equipment and has now reached the point where roadway lighting illumination has become practical. The marketplace is currently inundated with new products from old and new manufacturers aimed at the municipal and utility owners of street lighting. Each product must be evaluated on its own merits of efficiency and illumination characteristics when being considered for use in street lighting. It is our opinion that this is a promising technology, but still nevertheless still in its infancy. The Streets Department is actively monitoring the development of LED streetlights. We have met with over a half dozen vendors and have even installed several LED fixtures that were provided by a vendor free of charge to test their performance. These devices are located just outside of the windows of City Council Chambers. Several factors work against 55 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 the economic merits of using LED streetlights in Philadelphia at the present time. First, the initial cost of purchasing new LED luminaires is relatively high when compared to our current high-pressure sodium system. Second, the expected useful life of LED luminaires is roughly half of a standard HPS luminaire at this time. Third, the normal range of energy reduction for LEDs tends to be in the to 50 percent range 13 of an equivalent HPS fixture. However, a 14 50 percent reduction in consumption does 15 not equal a 50 percent reduction in 16 energy cost under the City's current rate 17 structure. Presently, PECO rates include 18 a fixed connection charge that is not 19 subject to a reduction if energy 20 consumption is reduced. 21 The Streets Department 22 continues to analyze the possibility of 23 migrating to an LED streetlight system. 24 When considering costs, we must consider 25 not only power cost savings but capital 56 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 costs, maintenance costs and the loss of value if we migrate to a new system before the existing system reaches the end of its useful life. Under various swap-out scenarios, the annualized costs for the total of power, maintenance and capital would be on the order of several million dollars more per year than the City currently pays. There are several key variables that may change as the technology evolves and matures. Certain changes could make the economics work for the City of Philadelphia. These include the cost of or useful life of the LED luminaires and our electricity rate structure. In summary, the Streets Department is open to considering new technology for street lighting and we are monitoring these issues. However, we would like to see the industry mature before we make significant investments that will likely be in the tens of millions of dollars. A recent article in 57 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 the magazine of the Illuminating Engineering Society, entitled "Lessons from the Field," by James Broderick, Program Manager for the U.S. Department of Energy's Building Technologies Program, reinforces our conclusion. In this article, Mr. Broderick concludes his review of potential LEDs for street lighting with the following quote: "Three U.S. Department of Energy gateway installations, one of which was for street lighting, illustrate that a go-slow approach with LEDs still makes the most sense." Thank you for your time and opportunity to testify. I would be happy to take any questions that you may have now.
Thank you very much. It seems in a couple areas there seems to be a real disagreement relative to your view of the lifespan of an LED light and what's been testified to 58 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 already, because they're polar opposites. The folks that have testified today relative to their product contend that the LED lasts longer than the current fixtures, and you're saying in your testimony it lasts for half the life.
I think what happens, Councilman, I think our agreement on the life expectancy of the LED is somewhat similar. Where we disagree on is the life of the current system. Our current lamps that we are purchasing for use in our streetlights have a rated life of 40,000 hours.
High-pressure sodium. They're using a number much less than that, and I think that's where the disagreement occurs.
The 40,000 hour lamp that the industry is now 59 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 manufacturing provides an obviously much longer life expectancy than I think was possibly used in their analysis.
Why would the City ever -- and you didn't enter into this agreement, so I'm asking it rhetorically. Why would the City ever enter into an agreement with PECO that said that if we reduce our energy consumption, we don't realize the savings?
Let me explain than, Councilman. The rate structure that we're presently using has been approved by the Public Utility Commission. It's a longstanding system of rates and tariffs, as you know. The connection fees that the utility charges 60 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 us are significant. The energy costs are relatively low. As long as we have the same number of streetlights, in the range of 100,000, we are still going to pay a connection fee to PECO regardless of the energy consumption.
So of the $15 million it costs to power the system, what percentage are connection charges and what percentage is energy?
It's in the ball park of about two-thirds is the cost for connection fees and one-third is for the cost of energy. And that's where the savings do not accumulate as significantly as if it was all energy charges.
Again -- and you might not have the answer to this -- historically why would we negotiate a deal with PECO that requires two-thirds of our costs go to a connection fee and one-third go to energy consumption? 61 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
Well, Councilman, it's not a negotiation, I mean, in a sense that these rates are approved and have been promulgated by the Public Utility Commission for use for both the City streetlight system and for other streetlight systems.
The current rate structure has been in place since the '90s and then preceding that back decades.
So, again, rhetorically, are we bound by this forever? I mean, if we're bound by this structure for the next ten years, there's no incentive to reduce energy costs.
First of all, Councilman, these rates are consistent across the board for all street lighting systems both in the City and outside the City. This is an issue that we have been raising in our conversations with PECO 62 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 with the rate changes when the rate caps come off next year. I know our Law Department and others within the Administration are trying to find a better way to reduce this imbalance of cost, but for the present time, that's the system under which we are operating.
But testimony has been today that in other cities where things are moving forward, there's an 18-month period of RFQ, RFP, selection, negotiation. So in that timeframe, the energy rates are going to change. Isn't this the opportune time to have something ready to go or have at least two or three, four vendors ready to go with a new construct while these new rates are being determined? I mean, to me it makes no sense to have a structure -- and, again, this is a PUC structure, it's not your structure -- that says regardless of what you save in energy, you're still going to pay these fixed costs. There's no 63 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 incentive to reduce consumption, to reduce carbon footprint and to reduce costs to the taxpayer. COMMISSIONER TOLSON: Councilman, I think we would agree with you, and it is our intention to intervene with the PUC relative to this rate case and the changes that are going to be coming about. The rates that are set by the PUC impact, as Joe was saying, the entire state. They're not individually negotiated for Philadelphia or some other community or some other business. So we are living within a rate structure that is determined for us. We do agree with you that given the present structure, it does challenge us with regard to an incentive to do something differently with our system. However, that has not been the thing that incents us. Our incentive has been to be prepared for whatever may come along relative to rates or otherwise and also environmental stewardship. So even 64 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 absent, say, a rate benefit, we are trying to do the right thing with regard to the system. Other things that impact our decision-making are not just the rates, but also the useful life of the system that we have in place.
What's the oldest -- I don't know how you divide up your districts from a street lighting perspective, but what's the oldest set of equipment that's out there now in a particular designated area?
Do we do it in locations or are they interspersed? There's old ones and new ones and not so old ones? COMMISSIONER TOLSON: It does move around the entire City, but I think the oldest we have --
And what's the life? 65 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
So the oldest is 15. And what percentage of our stock is, if you know -- if you don't know, you can get back to us. What percentage of that stock is years old 8 based on the 108,000? 9
So you 12 could potentially do this in a phased 13 effort. 14
Plus not taking into account -- not at this point taking into account all the other benefits to having an LED system in more safety and more light direction and the ability to light up areas from a public safety standpoint.
So that's a subjective issue that you can't really put a number, a financial number, on. 66 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
Would it make -- COMMISSIONER TOLSON: Into the capital costs that go along with it.
Right. But my point is, in the next year while we're having this discussion, intervening, doing whatever we're doing, PUC, PECO, if we were to be able to get a construct that allowed us to take advantage of energy cost savings, to be able to utilize that energy cost savings to capitalize that money to buy the new lights and it was not this tens of millions of dollars in capital up-front costs, would that be something that's appealable or appealing to the Department? COMMISSIONER TOLSON: I think we are certainly looking forward to all opportunities. So, yes, we would gladly look at all of our options. But just to be clear, I'm not sure about the exact 67 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 cost of this fixture per se, but in our system of 100,000 lights -- it's in excess of 100,000 lights -- if you're talking about a capital cost of $800 to $1,000, we're now talking about $80 to $100 million in our capital costs.
But my point is, hypothetically, if the rate structure allows for the benefit of energy cost savings and that money could be dedicated to be capitalized to buy the lights, it wouldn't be the out-of-whack capital expenditures that you anticipate. COMMISSIONER TOLSON: As long as the payback --
If we had a $4 million, $5 million energy savings that we can't take advantage of now, only a third of it, but if we could take advantage of the energy savings and that 4, 5 million can be capitalized annually to purchase the lights we need, without having to go into the --
Councilman, one 68 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 thing when you're running the numbers, when you're talking about the full amount of 4 to million, that's if the entire 5 system has been converted over.
So obviously in any kind of staged implementation, there's going to be a much smaller initial savings to therefore capitalize on.
Unless the City determines it's appropriate to put more capital money up front, a $5 million capital expenditure to start, and then reap the benefits of the energy savings going forward. That's something -- I mean, I don't expect 108,000 lights to be turned over in one year. I mean, the manufacturing of it is impossible to begin with. This probably has to be a five to seven, if it happened, a five- to seven-year kind of roll-out, I would think. And I was wondering, and I'm wondering out loud, whether PECO would be even interested in potentially, because 69 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 of their energy -- their environmental concerns and environmental activities, to partner somehow with this whole thing. So before I recognize Councilman Jones, what I would like to see is not an RFP but how about an RFQ that just goes out based -- anyone can respond, based on what we anticipate, on what the responders anticipate happening in the rate changes and what's going on in the next year. I'd be interested to see what people have to say or what they think. I can't see just being married to this high-pressure sodium forever, because -- for whatever reason. I think we need to look at changing the way in which we look at street lighting and in energy use, and we're never going to change it if we don't change it or don't look to see whether it's changeable. COMMISSIONER TOLSON: Councilman, I think that we agree with you in the concept. What we've been 70 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 challenged with so far, what the vendors have been challenged so far is just working out the costing, because the high-pressure sodium system, the change to LED is not so dramatic.
In what way? COMMISSIONER TOLSON: In terms of the advancement in technology, in terms of the benefit. The decrease in life expectancy, in turn the energy savings, all that together is not so dramatic, which is why we've been challenged so far, which is why we suggested that maybe this is still in its infancy and it's going to evolve more. We're with it. We're going to continue to evaluate that as it comes along, because we are not married to high-pressure sodium.
I don't mean this as a criticism to the Department, because I think you guys do a good job, but the problem with 71 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Philadelphia, in my experience in the 50 years or so I've been living here, is we never get up front on the infancy. We're always trying -- I mean, the stuff that we're dealing with now in environmental concerns and environmental issues, cities have been doing for and 30 years. I 9 mean, we just started five, six years ago 10 in dealing with our environment. I mean, 11 rather than wait -- we tend to wait and 12 see what's going to happen 15, 20 years 13 from now than getting in on the ground 14 floor and being a model as opposed to 15 being reactive to it. That's my -- I 16 don't mean it specifically in this area, 17 but in lots of areas. We just wait ten, 18 15, 20 years that cities have been doing 19 things and now all the sudden we're going 20 to get on board. I'd rather try to get 21 at the forefront of something than -- 22 because we'd probably be one of the major 23 cities -- only major city in the country 24 moving -- not moving -- not thinking 25 about it, but actually moving in that 72 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 direction, unless there's some other city that's way ahead of where we are now in the discussion. COMMISSIONER TOLSON: I think that you have heard that there aren't other cities that are doing it as yet, and there may be a reason for that, Councilman. It's just not quite there yet for this application. I think that some applications that are smaller in scale, they're great and I think at some point it's going to be ready for the curbside, but it's just not there yet.
Plus the other issue that I think is very important to look in a forward-thinking way is creating manufacturing opportunities for our residents, which don't come around all the time, and I don't know of any other companies you're talking to that are making the offer to manufacture the items here in the City, which is something that doesn't happen all the time. So I would ask you to 73 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 think about that, take that into consideration, and really not just wait to see what happens, but maybe we can be more proactive in seeing how we get there. COMMISSIONER TOLSON: We can certainly do that, Councilman.
Also, Councilman, the Department of Energy does have an extensive testing program in place for LED street lighting, and that information is kind of feeding back into the industry as well, and there's a lot to be learned from that. And so there are clearly other cities and test sites going on where information is already being gathered, and we can utilize that in our planning as well.
And you're willing to make a test site -- allow the City to be a test site for this particular product?
Given certain considerations in it, yes. The material 74 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 being donated to the City would then allow us to do that.
First of all, thank you for bringing this illumination to Council. I think it's important, because as we start to cite energy costs as a factor in our budgeting, $15 million worth of street lighting juxtaposing about 1,500 PECO accounts, which equates to about $64 million we spend annually with PECO as a municipality, it doesn't take a CPA to understand it starts adding up, and if we don't start the process of evaluation, selection and then replacement -- the sooner we get started, the sooner we start to save. Even if it's ten percent, even if the estimates are off, even if it's ten percent, that's a chunk of change that keeps a recreation center open. The other thing that I will 75 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 agree with the Chairman about is, we cannot be afraid to kind of look and make -- we can be ahead of New York on some things, God forbid, or LA or other major municipalities and come up with innovations. Where do we currently get our streetlights from?
We purchase them at -- the Cobra fixtures, that's the standard streetlight in Philadelphia, is purchased from GE Lighting Systems.
We have a GE headquarters who used to be at 30th Street.
They're located in North Carolina. The factory that 76 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 manufactures -- they have one factory in the United States and it's located in North Carolina.
That's not quite Philadelphia, nor the 4th District, but okay. My point being that it's important that we try to use our procurement prowess, power, purchasing power, to stimulate local entrepreneurship and create jobs here, which is a powerful incentive for me. So any demonstration, any beta testing that we can do now to start this process -- and I trust you to determine what is the best product, but I do remember when PECO came in here and told us that these 583 bulbs here would last ten years, I think we have at least half a dozen or so that are out now, and it's not been ten years.
I assume they're under warranty, too. Some of them just don't function, may be a defect.
But the 77 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 point is that you're going to have this kind of beta testing process, and I think the sooner we start, the better, and why not be first as opposed to last as a municipality.
Just one question about the Cobra lights. What's the length of the contract? Is there a lifespan of that contract?
Well, we currently have the -- it's a one-year contract renewable for three years, and I think currently it's about halfway through the time period.
How old is the contract overall? Not the current term of the contract. Was this a renewal?
It's a 78 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 one-year contract with three year options.
The Procurement Department bids this on a four-year cycle. It's gone back several cycles that -- we've been purchasing GE equipment for the past years. 9
So it's 13 not -- okay. So it's a one-year contract 14 with three one-year options? 15
There's other vendors who have bid. Procurement 79 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 actually runs the process, so we'd have to check with them exactly to see who the alternative bidders have been. But it's bid through a local supply house, so it's not bid directly from GE. The current contract is actually with Rumsey Electric, who provides the material.
What is your interface with the Department of Sustainability? And I guess the broader question is, what is the Mayor's practice, if you will, for department heads to interface with the Department of Sustainability as it relates to keeping up with technology? COMMISSIONER TOLSON: We work hand in glove.
So in the early part of your testimony you talked about how the Department does just that, try to stay ahead of or keep up with technology as it relates to the 80 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 efficiencies in your department? COMMISSIONER TOLSON: That's correct, Councilwoman.
Provide a couple of recent examples where as a result of your involvement with the Office of Sustainability, there have been clear management changes in efficiencies in the Streets Department. COMMISSIONER TOLSON: Surely. One big example is happening right now. We're going to have a fairly significant event around it. Is a conversion of our traffic signals to LED. Some years ago the Streets Department on the front end of technology but saw that it was going to be doable and successful converted reds to LED. In the intervening years, we were unable to convert the balance. Through work with the Office of Sustainability, their support with securing a grant and also a leadership in insight in terms of helping us press the issue, we're able to secure support to 81 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 get the greens and yellows converted as well as the reds to LEDs.
By "support," you mean financial support? COMMISSIONER TOLSON: Financial support.
Through grants that that office wrote, that the Office of Sustainability wrote? COMMISSIONER TOLSON: Yes. They helped us secure that, yes.
To better the efficiencies in your department? COMMISSIONER TOLSON: Yes.
So a model already exists. So fast forward to the discussion that we're having here today. Has your office and the Office of Sustainability looked at how eventually the capital improvement can or should be made to modernize our streetlights? COMMISSIONER TOLSON: I think that what's happening now is that we're staying on top of the LED streetlight 82 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 issue. As I mentioned, it even predates the Sustainability Office, but even now we developed a close relationship in working on the LEDs for the traffic signals. But we stay on top of this issue, but because of our present rate structure, we know what that is and we offer some advice to potential vendors about how things could work with that. But even still, with our future rates, as the Councilman noted, we don't know what that's going to be, and neither do our vendors. We could make some assumptions and build models around that, but there is some risk we're trying to build assumptions around that, but it's just understanding in our environment how can we make it work. We presently have a tap that clarifies some of the numbers. The utility costs are about 13 million total per year for utility costs. Of that, ten to 11 is what we call the tap, the connection fee, and the balance is actual electric usage. 83 6/14/10 - ENVIRONMENT/STREETS - RES. 100291
I see. COMMISSIONER TOLSON: So we've done some innovative things to try to reduce our tap costs, but we are working with what we are working with, and so is every other municipality. We're working in -- we use our energy in off-peak hours and we are currently negotiating what we are going to be paying for future energy. We're looking for what we're going to pay for our energy uses in the future.
I'm sorry. Negotiating with who? COMMISSIONER TOLSON: We're negotiating with potentially other vendors.
Other vendors of electricity? COMMISSIONER TOLSON: Yes.
How many are there? COMMISSIONER TOLSON: I don't know that answer. I can get it for you. What the world looks like, I don't know 84 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 what the world looks like, but I can find that out for you. And as I mentioned earlier, we do intend to intervene on the rate case. So we are trying to do what we can in terms of the structure, and then also trying to be innovative and just staying out front. Our concern whenever we build any system is to try to build it so that it can be successful. We do test some things, but we don't like to test things if we know that there's significant amount of risk. It may be profitable for a business, but it may not be profitable for the City.
Sure. COMMISSIONER TOLSON: So we just try to get a little bit more assurance about where the technology is going and whether it's going to work, and right now this infrastructure is fairly expensive for what we may be getting. This is not a switch-out of a bulb. They used the example this is not a bulb 85 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 replacement. It is not. There was some comment that this is a proprietary system or parts of it were proprietary, which means that you can only buy it from one place. You can't bid it like we bid right now for a Cobra head with various people.
But there's a downside of being able to bid it also, because you can't negotiate it. If it's sole source, you can negotiate it at least and get other benefits from it. The fear I have based on their testimony and what you know about the technology is that particular system may be LED and if you compare it to three or four other LED systems, they may not all be apples and apples. COMMISSIONER TOLSON: That's correct.
It might be apples and peaches, but the problem is is that then where does -- the argument then comes, is it in fact sole source. 86 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Because if there are six or seven patented bells and whistles on this that don't exist on any other competitor, you could argue -- whether or not the Law Department would agree or we would be sued by some of the other vendors -- whether or not that in fact is sole source, if they have a technology that the other companies do not have or employ and can't employ it because they don't have the patent on it. COMMISSIONER TOLSON: Councilman, as I mentioned, I have not met with this company, so I don't know what this offers, but we'd be more than glad to hear that, to understand what is so different about them versus the other competitors in the field.
Does your department have -- we are government. We're not major corporations, but it sounds like to me this falls under research and development. So does that exist any place in government or in the 87 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Office of Sustainability? I'm asking. I don't know. COMMISSIONER TOLSON: Our research and development comes about through the knowledge of some of the people that we have in our department. For example, Joe Doyle, who is well-versed technically, research-wise, technically in the field of energy usage, streetlight energy, is well-versed, actually teaches courses in this industry. We have people like that. In traffic we have a guy named Charlie Denny. Similarly, these are -- I call them technicians -- people who are well-knowledged in the field.
Sure. COMMISSIONER TOLSON: So we depend on those type of people who are engineers with experience and who know the industry --
Sure. COMMISSIONER TOLSON: -- to stay ahead of things. It's my job as the 88 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Commissioner to encourage them to engage new technology, innovation as a forefront of where we want to go as an organization, and that is important to us.
Let me just sum up a little bit relative to the purpose today. I wanted to start this public conversation, which we've done and will continue to do. I would appreciate -- and I know you've offered already to do so. I would appreciate it if you would agree to meet with -- and you have agreed -- to meet with this company to see what's different about this particular product as opposed to the others that you've looked at already. And I also would like you to look at the possibility of doing something with an RFQ that would get responses from companies around the country on what it is -- how they see what's coming, both 89 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 from a technological advancement standpoint, from a rate cap removal standpoint, and have them put their best feet forward and see if we can't get at least a database of information to begin to expand the discussion a little bit, because I think an RFP certainly has other implications, but an RFQ is something you can gather information. Of course, the response won't be as in-depth as responding to an RFP or an RFI, but either RFQ or RFI would be an interesting process to see what kind of responses you get based on citywide phase-ins, what they feel they can save in the way of energy costs in the event that we have a different PUC construct. All those things I think would be interesting to start now, because within the next year, two years, 18 months is when everything is going to shift, and I'd rather be prepared -- and I know you are preparing to be prepared, but I would like to see what the private sector responds to in 90 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 the way of just an RFI or RFQ. COMMISSIONER TOLSON: Surely.
Thanks. Is there anything that was put out there in the City Administration's testimony that you'd like to talk about or get back on the record? So, Commissioner and Mr. Doyle, I appreciate your testimony. Again, we want to continue to have this public conversation, but I would like to get them on the record again as to a couple things they may want to respond to so we have a clear record back and forth, not that one assertion is right and one is wrong. I just want to make sure that we have a clear record so we can have a discussion. But thank you for your attendance and your testimony. Gentlemen, if you want to come back. (Witnesses approached witness table.)
Again, it's 91 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 tedious, but please identify yourself for the record again.
It's easier to respond here. I know you feel rude having your back to them, but the most important person in the room that needs to hear you is right up here.
Okay. Is the longevity of LEDs versus the high-pressure sodium. One thing you have to look at is not just the bulb itself, but the system as a whole. The LEDs we've designed are basically more of a system. The LEDs will last 50,000 hours or more, again, designed properly around that with the technology. One thing that wasn't mentioned in this versus high-pressure sodium is 92 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 how temperature affects those things versus the LED. Typically very cold winters will shorten the life of an HPS bulb, vibration, those kinds of things. Those go away with LED technology. These things love the cold weather. In fact, the colder it is, the longer they last and the brighter they get.
Right, Commissioner, we don't like the cold weather, do we, especially when it's got snow in it? We had a bad winter.
So there's variables there. Also is a system -- again, we're a totally sealed unit as far as the lighting system itself, so we're not getting the dirt and all that. We're not having the degradation of light as 93 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 time goes on just due to dirt and fume infiltration into the system. Also, one thing I didn't mention, which is also patented technology, is the photo control in these. Typically a Cobra head photo control is a twist-lock device that just sits on top, and that is one of the main failure points of a Cobra head system today. I don't know how you do it here, but a lot of cities, when they go out to work on a light, they will automatically change that photo control because it's fairly cheap and they know it's going to fail, so they just change it while they're there. Ours is a downward-looking solid-state photo control that is not sitting on top. We don't have the water intrusion problems with that. From a technical standpoint, it looks at a narrow band of infrared light rather than visible light to trigger it, which is a component of sunlight. Therefore, the 94 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 light itself does not turn itself back off. So it's looking at a totally different component of sunlight than we're emitting. And being as part of this sealed unit, we don't have bird problems, dirt problems, again, water intrusion, those kinds of things.
It's going to be. It depends on the size and velocity of the bullet.
Basically. BB guns, no problem. It will withstand it without a problem at all. Twenty-two's most likely will withstand. You go up above that and it's going to be where you hit it kind of thing.
Right. I 95 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 understand.
Vibration, with this being all solid state, is not an issue at all.
Okay. Anything else you want to add just to finish up or are there any other items that you want to touch on that were touched on by the Streets Department?
One of the issues that we'd like to talk about is in the documentation that we prepared for you, we did some comparisons. Those are based off of assumptions that we had off of very limited documents just to get this whole thing going. So those numbers we can sharpen up as we move into further discussion and have more access to that information. The other side of it is that the biggest thing that we have to all remember here is that we're talking about apples and oranges. It couldn't be more different than the two technologies. 96 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 They're all meant to do the same job. The technologies are incredibly night and day different. The benefits of each are great. Some are greater than others, and the LED is definitely the way that we are moving forward. I've worked personally with PP&L over the last three and a half years to get them to commit to a rate structure that allowed for LED lighting to their municipalities. That was just filed on March 31st with the PUC. The PUC had no problems with it. The rate case itself did go back, not relevant to the LED portion, but the rate case itself did go back for further discussion, and July 1, I believe, is the next vote date on that. January of the following year would be the --
I was not aware until the testimony of the Streets Department that two-thirds of the $15 million is the privilege of plugging into the system. So, I mean, again, that's something maybe I don't know if you knew 97 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 in your calculations on energy savings, which again cuts it down to a third right now. It doesn't mean that won't change. With the PP&L one, was that a similar situation?
Where they weren't giving the municipality credit for energy savings?
PP&L's agreement with their municipalities by sound of the testimony today -- and I haven't looked at your agreement with PECO, but PP&L's agreement is quite a bit different than that scenario. If you don't mind, I'd like to let Peter answer that. He's a little more versed in that.
Right, restate my name. Peter Wernsdorfer, Municipal Streetlight Services. There were a couple of things, Councilman Kenney, if I can go back to 98 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 it. One of the things I brought up is this issue of configuration. What's germane to the discussion is that while there may be 108,000 area lights inside the City, I don't think anybody is advocating replacing every one of them. I mean, there's some applications where LEDs aren't going to be applicable, and I don't think anybody is thinking about that. But the issue of configuration comes to mind, because specifically because of the -- and, yes, I was aware of that. That's one of the reasons we ran our model the way we did. We work in a number of the different utility territories in the state and we're quite familiar with how the utility companies approach it. So the issue of configuration leads you to the point where you can use appropriate lighting to use the cost of removing fixtures. Just say you took 10,000 -- you have 108,000. Say you took 10,000 of them and you had $7 a month. Right there you're saving -- 99 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 that leads you to some serious capital to put into LED. And when I said it yields immediate results, that's specifically what I was trying to address.
So I appreciate the chance to just clarify that for the record.
So your testimony was with knowledge of the current rate structure?
And -- I'm sorry, not to interrupt, but we do look forward to having the discussions with the Commissioner and Mr. Doyle to move that forward.
I guess the 100 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 two things I would ask you guys to do -- and you've heard this, but just formally, is to again meet with them and also try to determine what is the best kind of demonstration street that you could help us with in taking a look at.
Yes. We'd like to look at some of your worst-case scenarios actually and see what we can do to make those. If we can make your worst-case scenarios much better, then we're very confident --
I think we'll have to bring the Police Department in for some advice on that one. So that might be helpful if they could give us an idea of what their needs are, too. So that's an agreement, and then we can move forward from here and hopefully we can have either another hearing or some other discussions on 101 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 this.
Is there anyone else to testify on this resolution? (No response.)
Is there anything you gentlemen need to add? (No response.)
Thank you very much. We enjoy having hearings we actually learn something, which there's a number of issues that both from you guys and the Streets Department this Committee was illuminated and it will be in the forefront going forward. So we do appreciate your time and your testimony and for coming in and everybody's attendance. Thank you. That will conclude the business of the Committee on Environment and Streets and Services.
Thank you. (Joint Committees on the 102 6/14/10 - ENVIRONMENT/STREETS - RES. 100291 Environment and Streets and Services concluded at 3:45 p.m.) - - - 103 CERTIFICATE I HEREBY CERTIFY that the proceedings, evidence and objections are contained fully and accurately in the stenographic notes taken by me upon the foregoing matter on June 14, 2010, and that this is a true and correct transcript of same. -------------------- MICHELE L. MURPHY RPR-Notary Public (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)