BAE Plans $2 Million “No-Money-Down” Retrofit

by | Dec 15, 2010

Defense industry giant BAE Systems plans $2 million in energy efficiency investments at its Greenlawn, NY, facility. The project includes heating and cooling system upgrades, high-efficiency pumps, motors and controls, and measures that will reduce electric and natural gas consumption.

The upgrades, to be implemented by mid-2011 are expected to deliver an estimated $300,000 savings in annual energy and operating costs. Siemens’ Building Technologies Division will execute the project at the Greenlawn facility, and be responsible for the project design, installation and delivery of ongoing maintenance services.

The project uses a progressive financing solution offered by Metrus Energy. BAE pays nothing up-front of the $2-million price tag, but rather repays over time based on a calculation of verified energy savings, i.e. the kilowatt-hours and therms of natural gas not consumed.

Metrus pays and continues to own the equipment, and BAE avoids all upfront costs with quarterly payments to Metrus based on actual “negawatts.” So, rather than pocketing its energy-efficiency returns, BAE pays for the project, according to calculations of  output-based cost per avoided energy units which are set at-or-below current utility rates.

This Efficiency Services Agreement  is the second agreement between BAE and Metrus, following a similar $1-million retrofit project implemented at BAE’s Merrimack, N.H. facility. Both projects are backed by Bank of America’s 10-year, $20 billion business initiative aimed at funding solutions for climate change.

The global downturn has dealt its blows to the defense industry, and BAE is not immune, as government spending tightens in the US, the UK and Australia.

However, BAE is making efforts to say on track of its environmental sustainability goals. After implementing more accurate data collection methods as well as making a number of business acquisitions, energy use and CO2 emission jumped from 920 thousand tons of CO2 in 2007 to 1,190 in 2008.  In 2009 BAE transferred 21,830 tons of carbon.

Energy use and efficiency remain top priorities, according to BAE, as the company targets requirements of the UK Carbon Reduction Commitment and the Australian National Greenhouse & Energy Reporting Scheme.

BAE says that the Metrus ESA allows BAE to scale their sustainability program across multiple sites without redirecting capital from core business objectives.

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