SECURING ARMY INSTALLATIONS WITH ENERGY THAT IS
CLEAN, RELIABLE AND AFFORDABLE
Presentation by LTC Kevin J. Lovell, PMP
To Washington, DC SAME Post
March 21, 2012
Assistant Secretary of the Army (Installations, Energy & Environment)
Agenda
- Strategic Energy Situation
- Army’s Energy Needs and Performance
- Army’s Sustainable Focus on its Utility Needs
- Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
2
The Last 11 Years…
Assistant Secretary of the Army (Installations, Energy & Environment)
3
Army Energy Consumption
United States
Federal Government
1%


Facilities
Vehicles & Equipment
(Tactical & Non-tactical)
DoD
80%
23%
24%
35%
65%
U.S. Army
76%
42%
58%
FY10 Highlights
•$2.5+B Operational Energy Costs
U.S. = 98,079 Trillion Btu
•$1.2 B Facility Energy Costs
Fed Gov = 1,096 Trillion Btu (FY09)
•+64% fuel costs in Afghanistan - not counting cost to deliver and secure
DoD = 819 Trillion Btu
•+$400 million increase in fuel costs expected in FY11 across DoD in Afghanistan
U.S. Army = 189 Trillion Btu
Sources: Energy Information Agency, 2010 Monthly Energy Review; Agency Annual Energy Management Data Reports submitted to DOE's Federal Energy
Management Program (Preliminary FY2010)
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
UNCLASSIFIED
4
Army Energy Outlook
Path to 25% Renewable Energy by 2025 - Notional
Energy Efficiency
Traditional Energy
Reaching Army energy
goals will require significant
number of large scale
renewable energy projects
Renewable Energy
Major Issues for Army Large Scale
Renewable Energy Projects
• Declining Budgets/Incentive Leverage
Need for third party financing
• Specialized Expertise
Requires financial, regulatory,
environmental, and real estate expertise
• Enterprise Strategy
To define the most efficient path to
reach Army goals
Energy Initiatives Task Force
% Renewable Energy of Total Energy
NDAA 2010:
25% by 2025
Renewable Energy
EP Act 2005
7.5% by 2013
Army Progress: .5% in 2011 from
168 different projects
Assistant Secretary of the Army (Installations, Energy & Environment)
UNCLASSIFIED
5
5
Strategic Overlook
Key Strategic Documents
OE Campaign Plan
Army Campaign Plan
13 Jan09
29 Jul 11
Army Energy
Security
Implementation
Strategy (AESIS)
Operational Energy Initial Capabilities
Document (ICD)
Army Operational Energy
Campaign Plan
TBP Dec 11
CENTCOM
Operational Energy
Documents
Contingency Basing
Campaign Plan
Army Power and
Energy White Paper
24 Sep 10
Tactical Fuel and
Energy
Implementation
Plan
&
Draft v0.2, 30 Jul 11
1 Apr 10
CB Campaign Plan
Draft 16 Aug 11
ACP 2012 (Draft)
Campaign Objective 2.0
Provide Facilities, Programs &
Services to Support the Army
and Army Families
2-8 Institutionalize
Contingency Basing
Leader Development
And Training
Change Culture
22 Feb 11
19 Aug 10
19 Aug 10
13
13 Oct
Oct 10
10
DICR’s and Joint ICD
Campaign Objective 8.0
Improve Energy Security and
Sustainability
Major Objective 8-2
Enhance Operational Energy
Effectiveness & Operational
Sustainability
Assistant Secretary of the Army (Installations, Energy & Environment)
Operational Energy
6
Army Energy Initiatives Task Force
Energy Initiatives Task Force (EITF) established by the Secretary of the Army
on September 15, 2011.
EITF serves as the central management office for partnering with
Army installations to implement cost-effective, large-scale,
renewable energy projects, leveraging private sector financing.
• Projects greater than 10MW
• Will coordinate with installations for 1-10MW
opportunities
• Potential for projects that exceed Army requirements
• Solar, Wind, Biomass/WTE and Geothermal technologies
• Potential to support resource validation, environmental
permitting, regulatory approval and other project
requirements
• Will use DoD land-use and third-party financing authorities
Potentially over 1 GW of projects to satisfy Army
requirements.
Energy Initiatives Task Force
Secretary of the Army
John M. McHugh
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
7
EITF Organization
Executive Director
John Lushetsky
Heidi Hansen
Office of General Counsel
Planning Division
Execution Division
Outreach Division
Kathleen Ahsing, Director
Alan King, Director
Jon Powers, Director
Jeff Smith
Douglas Waters
LTC Kevin Lovell
Erich Kurre
Partnerships
U.S. Army Corp of Engineers
Defense Logistical Command
Department of Energy
National Renewable Energy Lab
Pacific Northwest National Lab
Department of Air Force
Department of Interior
Department of Navy
Note: The EITF reports to the DASA IE&E (E&S), Mr. Richard Kidd, IV
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
8
The EITF and the Army Campaign Plan
Achieve Energy
Security &
Sustainability
Objectives
ASA (IE&E)
Staff Coordination: ACSIM
Core Enterprise: SICE
8-1 Adapt / Execute
Installation Energy
Security and
Sustainability
Strategies
ACSIM
The EITF is
leading efforts
to deploy large
scale
renewable
energy projects
in fulfillment of
ACP Objective
8-1
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
9
EITF Enabling Authorities
The EITF will leverage existing Army authorities to meet
sustainability and renewable energy goals:
• Utility Energy Services Contracts (10 USC 2913)
• Enhanced-use Leasing (10 USC 2667)
• Easement authority (40 USC 1314)
• Acquisition of Utility Services (FAR Part 41)
• Power Purchase Agreements (10 USC 2922a)
• Energy Savings Performance Contracts (42 USC 8287 )
• Cooperative Agreements (31 USC 6305)
• Sale of electrical power from alternative energy and co-generation
facilities (10 USC 2916)
• Environment, Energy and Water Efficiency, Renewable Energy
Technologies, Occupational Safety, and Drug-Free Workplace (FAR Part
23)
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
10
Planning and Execution Process
The EITF is producing a process for developing large-scale renewable energy projects that is
clear, consistent and transparent. This process will be described in a Renewable Energy
Project Development Guide that will detail the five phases of project development.
Phase 1
Opportunity
Identification
“Identify and Prioritize
Opportunities”
Target: 90 Days
Phase 2
Project
Validation
Phase 3
Acquisition
“Developing an Opportunity
Into a Project”
Target: 90-180 Days
Current: 1-3 years
• Conduct GIS Screening to
ID installations w/ RE
potential
• Analyze maturity of effort
• Assess top level economics
• Identify sites on
installations w/ master
plans
• Visit installation and
confirm data on sites
• Assess Environmental and
Operational Issues
• Conduct Go/No Go
Assessment
• Prioritize sites in portfolio
on Army RE goals
• Sign MOU with
installations
• Conduct initial legal and
regulatory review
• Initiate NEPA assessments
• Provide full Economic Case
Analysis (ECA)
• Coordinate Off-Take and
other Stakeholder Input
• Define Real Estate strategy
• Define System Integration
approach
• Assess Mission Operation
and Security Impacts
• Obtain Required Approvals
and Clearances
• Define Acquisition
Approach
Energy Initiatives Task Force
Phase 4
Building
Infrastructure
Phase 5
O&M and
Closure
“Getting a Binding
Agreement”
Target: .5-1 Years
Current: 1-3 Years
“Constructing Assets;
Structuring Services”
Target: 1-3 Years
“Managing the Operation
and Transition to Closure”
Target: 10-30 years
• Develop Acquisition
Requirements and
Evaluation Criteria
• Solicit Proposals from
Industry
• Select “Highest Ranking
Offeror”
• Obtain Required Approvals
and Clearances
• Finalize Business
Arrangements
• Award Contract or Execute
Lease
• Monitor and Enforce
performance, quality,
schedule and warranty
commitments
• Structure and Implement
Support Service
Agreements to Developer
• Structure and Account for
Lease Payments or In-Kind
Consideration
• Structure and Account for
Power Purchase Payments
• Structure and Implement
Service Agreements with
Developer
• Structure REC transactions
and accounting
mechanisms
• Track PPA Payments
• Track REC management
• Conduct enforcement of
performance, quality, and
warranty commitments
with operator
• Conduct validation of
O&M activities vs O&M
plan/schedule (case by
case)
• Manage Counterparty Risk
(credit monitoring)
• Develop
transition/maintenance/d
e-commissioning plan
• Update installation energy
plan
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
11
Our Evaluation Process
In tandem with the “enterprise view”, we are constantly
responding to ideas coming from industry and installations
Phase 1
Opportunity
Identification
Phase 2 Project
Validation
Systematic
Enterprise
Approach
Previous
Studies
Prioritization &
Slotting
600 Projects
Phase 3
Acquisition
Process
Phase 4
Construction
Phase 5
O&M and
Closure
Phase 1
Opportunity
Identification
Screening and
Prioritization based on
Mission, Regulatory,
Legal, and Economic
Suitability
MOU
Signed
Phase 2
Project Validation
Intake
Process
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
12
A Balanced Approach
EITF seeks to create a balanced pipeline of opportunities that will
serve three driving principles
Energy Security
• Surety (access)
• Survivability (resilience)
• Supply (alternative sources)
• Sufficiency (adequacy for missions)
• Sustainability
24x7 supply
for critical
assets
Price Stability
Life Cycle Cost
Deployment Speed
Capacity Factor
Mandates
• NDAA – 25% by 2025
• EPAct – 7.5% renewable electricity
consumption by 2013
• EO 13514– 34% GHG reduction by 2020
Energy Initiatives Task Force
Economic Benefits
• In-kind revenue
• Reduced/stable energy bills
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
13
Systematic Enterprise Approach
We have screened the entire Army enterprise to
identify a strong bench of opportunities
Where is Energy
Security critical?
Where is best potential
for Large Scale RE?
96 Sites, 179 Opportunities
(180 Sites Total)
Where could RE be
cheaper than grid
power?
90 sites for wind
39 sites for solar
10 sites for biomass
Energy Initiatives Task Force
Security Tier
Where are other factors
to consider?
•
•
•
•
Additional off-take
Existing utility relationships
Access to transmission
Well defined environmental
issues
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
14
RE sites potentially below grid-price
PV Sites
Pohakuloa Training Area
Pupukea Paalaa Uka Mil Road
Fort De Russy
Makua Mil Reserve
Schofield Bks Military Reservation
Gerstle River Arctic Test Site
Aliamanu Military Reservation
Waianae-Kai Military Reservation
Kahuku Training Area
Fort Shafter
Tripler AMC
Kipapa Ammo Storage Site
USA Field Station Kunia
Wheeler Army Airfield
Helemano Military Reservation
Fort Hamilton
Fort Hunter Liggett
MTC-H Camp Roberts
MTA Camp Edwards
NTC and Fort Irwin
ITC Camp San Luis Obisbo
Sierra Army Depot
Defense Distribution Region West Tracy
Defense Distribution Region West Sharpe Site
Riverbank AAP
Parks Reserve Forces Training Area
Fort Ord
Hawthorne Army Depot
White Sands Missile Range
Presidio Of Monterey
Stones Ranch Military Reservation
Pinon Canyon
Fort Bliss
Watervliet Arsenal
Fort Drum
NG Camp Fogarty TS
Fort Huachuca
Fort Myer
HQBN Henderson Hall Arlington
Estimated
Grid Premium
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Estimated Grid
Premium
Biomass Sites
Tripler AMC
USA Field Station Kunia
Fort Hamilton
Kipapa Ammo Storage Site
MTA Camp Edwards
Fort Drum
Defense Distribution Region West Sharpe Site
Watervliet Arsenal
Parks Reserve Forces Training Area
Defense Distribution Region West Tracy
$
$
$
$
$
$
$
$
$
$
Estimated Grid
Premium
Wind Sites 1
Pupukea Paalaa Uka Mil Road
Pohakuloa Training Area
Makua Mil Reserve
Tripler AMC
Fort De Russy
Kahuku Training Area
Fort Hamilton
Fort Shafter
Waianae-Kai Military Reservation
MTA Camp Edwards
Aliamanu Military Reservation
Gerstle River Arctic Test Site
Black Rapids Training Area
NTC and Fort Irwin
Helemano Military Reservation
ITC Camp San Luis Obisbo
Stones Ranch Military Reservation
USA Field Station Kunia
Pinon Canyon
NG Camp Fogarty TS
Fort Drum
Wheeler Army Airfield
Schofield Bks Military Reservation
NG TS Ethan Allen Range
Defense Distribution Region West Sharpe Site
Fort Monmouth Main Post
Camp Perry TS (CTC)
Presidio Of Monterey
Kipapa Ammo Storage Site
HQBN Henderson Hall Arlington
Fort Bliss
Fort Myer
Riverbank AAP
Picatinny Arsenal
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(0.00)
$
$
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Estimated Grid
Premium
Wind Sites 2
Fort George G Meade
Defense Distribution Region West Tracy
Fort Dix
Tobyhanna Army Depot
Fort Lesley J McNair
MTC-H Camp Grayling
Fort Huachuca
Camp Grafton
Fort Bliss AAA Ranges
White Sands Missile Range
Fort Buchanan
Camp Dodge Johnston TS
Yakima Training Center
Fort Riley
Fort Ord
Fort Indiantown Gap
Fort Detrick
Iowa AAP
Walter Reed AMC Main Post
Charles E Kelly Support Facility
Fort Richardson
Camp Rapid
Detroit Arsenal
Lake City AAP
USA Adelphi Laboratory Ctr
Yuma Proving Ground
Military Ocean Tml Sunny Point
Fort A P Hill
NG Mead TS/FMS 06/UTES 02
MTA Fort Wm Henry Harrison
Hawthorne Army Depot
MTCH Camp Guernsey
Pueblo Chemical Depot
Carlisle Barracks
MTA Camp Rilea
Kansas AAP
Defense Distrib Depot Susq
Tooele Army Depot
Sierra Army Depot
Marseilles (MTA Training Area)
McAlester AAP
CTC Fort Custer Trng Center
US Army Joint Sys Mfg Ctr Lima
Umatilla Chem Depot
Blossom Point Research Facility
MTC-H Camp Roberts
Fort Pickett, ARNG MTC
Stewart Annex
Camp Ashland
Newport Chem Depot
MTA Camp Crowder Neosho
Ravenna Training and Log Site
$
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$
$
Assistant Secretary of the Army (Installations, Energy & Environment)
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Project Risk Assessment Template
Project Risk Assessment
Project Risk Factors are
reviewed on a weekly basis to
identify roadblocks and key
issues for successful project
development
Mission/
Security
Economics
•
•
•
•
•
•
What is the estimate of the baseline capital cost?
Have all other development costs been included?
What is the value of any REC’s?
Is resource validation required? What is the status?
What is existing utility rate and alternative tariffs?
Does Economic Case Analysis (ECA) show cost savings for Army
considering current and project utility rates?
Real Estate
• What is the approach and what authority is being used?
• What are issues to obtaining required BLM agreement?
Regulatory
(Legal)
• What are the regulatory limits for interconnection, net-metering?
• What is the status of getting required PUC approvals?
Off-Take
Integration
(Technical)
NEPA
Acquisition
Energy Initiatives Task Force
• How does project enhance energy security on Installation?
• What are the possible impacts to Installation operations?
• How much does installation use now and is this sufficient to consume all
electricity?
• If power is to be sold off the installation, have off-takers been identified?
• What is the status of state RPS to drive demand?
• What are the technical issues to connect to grid (e.g., substation, line
capacity, etc.)?
• What is the status of required interconnect or flow studies?
• What are the major NEPA issues?
• Who will implement NEPA and what is the timeline?
• What is acquisition strategy and timeline to implement?
• What performance risks are there with the developer or other partners?
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
Sample of Key Renewable Energy
Stakeholders, Their Relevance & Impact
ACSIM / IMCOM
 ACSIM: Review Reports of Availability
for consistency with DA requirements for
those outgrants on Army-controlled
military real property requiring approval
by higher authority. Approves distribution
of funds from EUL
 IMCOM: Coordinates and processes
EUL Actions. Ensures EULs are
recorded and documented in the RPI.
Recommends distribution of funds from
EUL
DASA (E&S) & (I&H)
 DASA (E&S): To determine Army
Facilities energy policy
 DASA (I&H): Chairs Real Estate Business
Clearance Process and provides policy,
programming and oversight for the full
lifecycle of real estate programs and
actions
USACE
 Through Chief Appraiser, establishes
appraisal standards, ensures certification
of DA appraisers, and reviews or
delegates review of contractor or staff
prepared appraisal of real property
 Contracts for Environmental Baseline
Surveys
 Oversees Report of Availability
 Administers lease compliance, in-kind
considerations, and REC/Utility bill
management
AEC
 Provides environmental expertise to
leaders, commands, Soldiers, and
communities
 Contracts for and oversees environmental
analyses
Renewable Energy
Project
 Provide our Soldiers a decisive advantage
in any mission by developing, acquiring,
fielding, and sustaining the world's best
equipment and services and leveraging
technologies and capabilities to meet
current and future Army needs
Army G-3/5/7
 Determines project compatibility with
mission requirements
DLA
 Leader in DoD’s efforts to supply the
military services with alternative fuel and
renewable energy solutions
Energy Initiatives Task Force
ASA (ALT)
MICC
 Plans, integrates, awards, and administers
contracts throughout the ARFORGEN
Cycle supporting the Army Commands
(ACOMs), Direct Reporting Units (DRUs),
USARNORTH and other organizations
ASA (FM&C)
 Formulate submit and defend the Army’s
budget to the American people; provide
timely, accurate and reliable information
to enable leaders and managers to
incorporate cost considerations into their
decision making
Assistant Secretary of the Army (Installations, Energy & Environment)
UNCLASSIFIED
17
Rapid Improvement Event
Accomplishments
• Validated the current state process
– Including documented DLA and USACE
acquisition timelines for ESPC, UESC, and PPA
awards
• Answered outstanding issues (use of
commander’s site license, RGB purview,
OMB scoring, DoD Siting Clearing House,
Phase 1 data sources
• Created dialogue amongst different
stakeholders and socialized the need to
centralize processes within the EITF to
generate 1 project per quarter
Assistant Secretary of the Army (Installations, Energy & Environment)
Rapid Improvement Event Next Steps
• Distribute Executive Summary and After
Action Report of Session
Recommendations
• Adjust process maps to reflect
recommendations
• Incorporate recommendations into draft of
Project Development Guide
• Distribute draft of Project Development
Guide to participants for review and
comment
Assistant Secretary of the Army (Installations, Energy & Environment)
EITF Acquisition Approach
Multi-Award Task Order Contract (MATOC)
•
•
•
The EITF will develop a multipronged acquisition strategy that
can provide required flexibility
beyond the Task Force term.
We expect to utilize multiple
contracting offices, potentially
including the Army Corp of
Engineers and Defense Logistics
Agency, as well as DOE
contracting authorities (WPA, BPA,
TVA).
The EITF anticipates leveraging a
Multi-Award Task Award Contract
(MATOC) for PPA’s being
developer through USACEHuntsville.
–
Draft RFP was issued for comment on
February 24, 2012
Energy Initiatives Task Force
Solar, Wind,
BioMass,
Geothermal
Companies
Qualification/
Downselect
•
•
•
•
•
Qualified
Developers
Qualified
Projects
Project Specific
Task PPA Order
•
•
EITF Due
Diligence
Qualification based on demonstrated
experience to develop and finance
RE projects
3-5 Companies per Technology
Initial 3 year contract with 1 year
options
On-Ramp and Off-Ramp Provisions
Target release of 3Q12
RE
Project
PPA
SBA and Unrestricted based on
Project Size
$5B total ceiling for 30 years’
payments
RE Project
Opportunities
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
20
Questions?
• If you have questions or want to do
business with the Army’s Energy Initiative
Task Force, please register at
• WWW.USARMYEITF.COM
Or contact:
LTC Kevin J. Lovell, PMP
Kevin.J.Lovell4.mil@mail.mil
(O):571-256-0509
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
Unclassified
21
AMERICA’S ARMY:
THE STRENGTH OF THE NATION
ARMY STRONG
Energy Initiatives Task Force
Assistant Secretary of the Army (Installations, Energy & Environment)
UNCLASSIFIED
22