Escondido staff and Climate Tech present $50–70M preliminary citywide energy roadmap; no action taken

Escondido City Council received an informational presentation on a proposed citywide energy roadmap from Deputy City Manager and Director of Development Services Jan Escobedo and consultants from Climate Tech, who outlined a prioritized scope of projects intended to modernize aging systems, reduce utility spending and provide backup power for critical facilities. There was no required action at the meeting.

The roadmap matters because the city currently spends about $9,000,000 annually on SDG&E utility charges and staff told the council those costs have risen more than 40% over five years; presenters said that trend—combined with regulatory and insurance pressures—could continue and increase long-term operating and capital pressure on the general fund and enterprise funds.

Climate Tech and staff presented a two-stage, design-build approach: (1) finalize a detailed assessment and scope based on the pilot and staff input, then (2) implement prioritized projects. The consultant said the prioritized scope the city heard that night is preliminarily estimated at $50–70 million and represents roughly a third of a broader assessed need of about $150 million across eight categories including HVAC and building automation, lighting, roofing, water and wastewater process improvements, solar and EV charging, and microgrid/backup power. "The city will recoup its investment with guaranteed savings over the life of the new equipment," Jan Escobedo said during her introduction.

Climate Tech described financing and contract protections the firm proposes. The company said the RFP required a guaranteed-savings structure and a not-to-exceed turnkey price: "We have to provide a guarantee—not to exceed price and guaranteed savings," a presenter said. The firm described financing options that use equipment or real property as collateral (including green energy bonds or municipal lease-purchase structures), and said cities commonly select terms from 10 to 20 years (some up to 30 years for long-lived assets, though the presenter cautioned not to exceed the useful life of assets).

Council and staff questions focused on timeline, savings realization, resilience and technical details. Presenters said construction would be completed in roughly two to three years if the council approved an implementation package and that the city would begin seeing construction-period savings as individual measures (for example, lighting upgrades) came online; guaranteed, contractually measured savings would be tracked after the project closeout and turnover to city operations. On backup power, presenters described microgrid installations (generators with automatic transfer switches) sized to run full building loads at key facilities including City Hall, the EVCC building and public works; the presenters said natural-gas generators remain the most reliable option for continuous emergency operation at municipal scale.

Presenters said LED retrofits remain a significant near-term opportunity—about 4,500 fixtures remain to be modernized—and that many HVAC and control systems are more than 20 years old; some rooftop refrigerants in older units are banned and require full replacement. They noted long lead times for electrical equipment (transformers, inverters, generators) that can approach a year, and argued a front‑loaded, consolidated approach would lock current prices and avoid higher future construction costs. Climate Tech also said it maintains third-party measurement and verification under International Measurement and Verification Protocol Option C and is accredited by the National Association of Energy Service Companies and the U.S. Department of Energy.

Funding sources presented include grants and incentives, traditional CIP allocations, Measure I revenues and low‑interest financing. The consultant said its fee on a turnkey implementation is 5% of the project amount; the firm said there are no exit fees if the city decides not to implement. Staff stressed that no formal council action was required that night; they asked council members to consider priorities and provide direction at an upcoming council retreat so the city can decide whether to pursue financing proposals and return with firm implementation terms.

The presentation incorporated a decade-old pilot the city ran with the same contractor; presenters said that pilot produced guaranteed savings that exceeded the original guarantee and that the firm typically writes a check for any shortfall between guaranteed and measured savings. Councilmembers expressed interest in the outreach and community-education elements Climate Tech offers as part of longer-term contracts.

Next steps identified by staff and the consultant include a detailed engineering assessment (no additional development fee from the consultant for that phase), solicitation of financing proposals if the council directs staff to proceed, and returning to council with final scope, guaranteed savings estimates and contract terms for approval.

Votes at this meeting: none. No motion or vote was taken on the roadmap; the presentation was informational only.