The Green Revolution: Is EO 13423 Your Opportunity to Win Big?

In spring of 2007, Executive Order 13423 “Strengthening Federal Environmental, Energy, and Transportation Management” (EO 13423) became law. This article analyzes some of the key provisions of EO 13423, and explains how the sweat and hard work that went into EO 13327 compliance reporting and asset planning can be played against the requirements of the new “mean and green” US government.

EO 13423 is sweeping legislation that changes the basic mindset and tenets of how government views and manages its overall operations. A “nexus” has been established that moves ongoing operations and planning from a consumption based approach, to one of sustainability and life cycles cost / benefit determinations.

The new Executive Order rescinds five previous EOs: 13101, 13123, 13124, 13148, and 13149 as well as two related memoranda to achieve a strong and consolidating focus. This EO requires the adoption of Environmental Management Systems (EMS) as the framework for managing the multiple aspects of this new legislation and tracking improvements in sustainability practices.

What are the significant EO 13423 goals and compliance dates that facility managers need to be aware of?

• Energy efficiency: Reduce energy intensity by three percent annually through 2015 or by 30 percent by 2015.
• Greenhouse gases: By reducing energy intensity by three percent annually or 30 percent by 2015, reduce greenhouse gas emissions.
• Renewable power: At least 50 percent of current renewable energy purchases must come from new renewable sources (in service after January 1, 1999).
• Building performance: Construct or renovate buildings in accordance with sustainability strategies, including resource conservation, reduction, and use; siting; and indoor environmental quality.
• Water conservation: Reduce water consumption intensity by two percent annually through 2015.

Many agencies are well prepared for these challenges since the organizational changes, inventory condition assessment programs, performance tracking and capital asset planning requirements, fostered by EO 13327, are now in place.

Additionally, facility management has planned for disposal of non-mission critical assets, moved to Leadership in Energy and Environmental Design (LEED) grade construction standards, and embraced enterprise-wide asset management reporting tools that provide solid justification for sustainment, recapitalization and operational funding against the capital plan.

Achieving the five primary EO 13423 goals detailed above requires planning and monies. Fortunately the majority of facility managers can reach out to their Agency’s Energy Coordinators and DOE’s Federal Energy Management Program (FEMP) to better understand the compliance issues and get started reviewing the potential of using IDIQ Energy Savings Performance Contracts (ESPCs) and Energy Services Companies (ESCOs) for projects.

As DOE states on its Web site, “An ESPC is a contracting vehicle that allows agencies to accomplish energy projects for their facilities without upfront capital costs and without special Congressional appropriations to pay for the improvements.” The key to using this program is that the generated energy savings must meet or exceed the cost of the project over the term of the contract – which can run up to 25 years – and the ESCO guarantees this savings rate or return.

The components of the ESPC program include 20 Technical Categories (TCs) that break out the types of project families into which fall, Energy Conservation Measures (ECMs), as subcategories. These are “place settings” that represent sample improvements so facility managers can simplify the evaluation process of what repairs may qualify under a given technical category type. Below is a summary of the available TCs. As you can see from this list, the five major goals identified above have corresponding technical categories. (The full TCs list, including all ECMs, is available from FEMP.)

TC.1	Boiler Plant Improvements
TC.2	Chiller Plant Improvements
TC.3	Building Automation Systems/Energy Management Control
TC.4	Heating, Ventilating, and Air Conditioning (HVAC, not including boilers, chillers, and Building Automation System (BAS)/Energy Monitoring/Management Control System (EMCS))
TC.5	Lighting Improvements
TC.6	Building Envelope Modifications
TC.7	Chilled Water, Hot Water, and Steam Distribution Systems
TC.8	Electric Motors and Drives
TC.9	Refrigeration
TC.10	Distributed Generation
TC.11	Renewable Energy Systems
TC.12	Energy/Utility Distribution Systems
TC.13	Water and Sewer Conservation Systems
TC.14	Electrical Peak Shaving/Load Shifting
TC.15	Energy Cost Reduction Through Rate Adjustments
TC.16	Energy Related Process Improvements
TC.17	Commissioning
TC.18	Advanced Metering Systems
TC.19	Appliance/Plug-load reductions
TC.20	Future ECMs

Here is how the work that went into EO 13327 compliance reporting and asset planning can now be played against the requirements of EO 13423. Facility managers can achieve their greatest wish: Funding much needed projects, first identified during EO 13327, outside of their normal capital budgeting sources, using properly balanced ESPC vehicles. The additional kicker is many of these EO 13327 projects can be structured to ALSO satisfy the compliance goals of EO 13423.

I want you to be the hero in your agency. Take the time to match up your already identified projects in your capital plan and stack them up against the EO 13423 goals; you will find that if done right, your agency can win big and still leave you with cash in hand.

Robert Hibschweiler has substantial federal account management experience. He has worked extensively with real property management solution providers and is now focused full-time on bringing EO 13423 “green” technologies to the federal marketplace. He is based in the Washington, DC metropolitan area.