Minnesota Statutes §216C.42 and §216C.43 grant the Department of Commerce authority to provide local units of government with technical services in completing energy project studies and a standard project financing agreement.
The Local Energy Efficiency Program (LEEP) provides a master contract with qualified engineering firms (Contractors) along with the technical and contractual assistance to complete investment grade audits (IGA) for local units of government.
The intent of this program is to maximize energy and operational cost savings through investment in public facilities, contributing to statewide energy use reduction goals while creating jobs across the state.
Promote awareness and implementation of energy efficiency and renewable energy measures in public facilities at local units of governments by completing investment grade audits (IGA). By focusing on studying technically and economically feasible energy conservation measures, the program will encourage local governments to implement projects that reduce annual facility energy costs, create jobs across the state, improve facility infrastructure, and reduce carbon emissions.
Pre-qualify Contractors through a standard State RFP process to participate in LEEP and administer a master contract of these Contractors.
Develop and administer master contract for use by local units of government, defined as a Minnesota:
Statutory or home rule charter city
Park district, or
Any combination of those units operating under an agreement to exercise powers jointly.
Provide technical and contractual assistance to local governments seeking to utilize LEEP to complete IGAs.
Assist local units of government with:
Evaluating their facilities for potential energy efficiency investment opportunities and the best program fit with the Department of Commerce to achieve those goals.
Soliciting and awarding Site-Specific Request for Proposals from pre-qualified Contractors to perform an IGA.
Evaluating the technical and financial feasibility in both the preliminary and final energy audit reports.
Analyzing the available financing options if the local unit of government decides to pursue energy project implementation.
Commerce issued an RFP in 2016 to firms providing investment grade audits to pre-qualify to provide these services to local units of government. The following 10 contractors were qualified and have entered into a master contract with the Minnesota Department of Commerce to provide services as part of LEEP:
Amec Foster Wheeler Environment & Infrastructure, Inc.
Center for Energy & Environment (CEE)
Gausman & Moore
H&H Energy Services, Inc.
Hammel, Green and Abrahamson, Inc.
Karges-Faulconbridge, Inc. (KFI)
Sustainable Engineering Group, LLC
LEEP Process Overview
LEEP is primarily a tool to complete an investment grade audit (IGA), and can be broken down into three main stages. Since the goal of LEEP is to not only complete IGAs, but also implement the recommended energy conservation measures, LEEP stages fit into a broader process of project management, including procuring project design and construction bids, financing, project implementation, and ongoing facility operation and maintenance.
Commerce staff work with the local unit of government to review goals, site and building information, past studies and projects, and utility data. With Commerce’s assistance, local units of government determine which of our programs, including other energy savings programs such as GESP, may be the best fit. A joint powers agreement with the Department of Commerce is required move forward with LEEP to access the program’s master contract, work order contracts, and other program tools.
LEEP provides local units of government with standard tools and documents to release a Site-Specific Request for Proposals (RFP) to our pool of pre-qualified contractors in the master contract. Once this is released, a site walk-through may be completed with all interested Contractors to provide information in an open meeting format. Contractors who respond to the Site-Specific RFP will be evaluated by the local unit of government.
The local unit of government will notify the selected Contractor and encumber the funds necessary to move forward with an IGA.
The Investigation phase of LEEP is broken down into two major stages: a Preliminary Assessment and Analysis and a Detailed Investment Grade Audit.
The Preliminary Assessment and Analysis includes the Contractor meeting with the local unit of government to:
Establish work plans, schedules and milestones, and communication procedures.
Collect data and background information from the local unit of government concerning facilities operation and energy use.
Perform a preliminary walk-through of the facilities.
Establish base year consumption for use in comparing projected energy savings against.
Present preliminary findings and recommendations, and to establish agreement on measures to include in the detailed analysis and audit report.
Once the measures to be studied in detail are agreed upon between the Contractor and local unit of government, the work order contract will be amended to include tasks and fees to complete a detailed IGA. The primary deliverable of the second stage is a Final Investment Grade Audit Report, which details potential energy savings and an estimated project implementation costs by energy conservation measure.
Post-LEEP Project Implementation
Once a final IGA is complete, a LEEP project is technically done. However, the goal of LEEP is to find viable, cost-effective projects at local units of government. Should LEEP provide a viable energy project, the local government would then move to Design and Construction Bid phases, using standard procurement practices.
Local units of government have access to many financing options to implement an energy project, including standard methods such as bonds, capital expenditures, and tax levies, and lease-purchase financing.
Once a project is implemented, Commerce reviews the LEEP program and Contractor experience in order to continually improve LEEP moving forward.
Energy Savings Partnership
Administered by the Saint Paul Port Authority, this program offers lease purchase agreement financing for local units of government and K-12 school districts. It provides access to low-cost lease purchase financing for energy efficiency and/or renewable energy systems in existing properties. More information can be found on the Commerce Financial Assistance page.
The Public Entity Energy Audit and Renewable Energy Feasibility Study Loan Program
For local units of government that find it challenging to encumber funds for a LEEP Investment Grade Audit due to budget cycles or other issues, Commerce offers a short-term, low-interest loan specifically for energy audits and renewable feasibility studies. The loan may be up to $25,000 and can be rolled into a project’s implementation cost should the local government choose to do so. More information can be found on the loan program’s page.
Exhibit A includes a Sample Work Order Contract, detailing the Contractor’s duties, along with the Work Order Contract’s Sample Exhibit A and Sample Exhibit B.
Exhibit B – Sample Amended Work Order Contract
Exhibit B includes a Sample Amended Work Order Contract, detailing the updated Contractor’s duties, along with the Work Order Contract’s Sample Amended Exhibit A and Sample Amended Exhibit B.
Exhibit C – Contractor’s Fee Schedule
These are the maximum costs, markups and fees applicable to the performance of the Contractor’s Duties as specified in Exhibit A: Sample Work Order Contract and Exhibit B: Sample Amended Work Order Contract. The markup and fee values were included in each Contractor’s response to pre-qualify for the LEEP, and may not be exceeded on any individual project.
The LEEP Site-Specific RFP is issued by the local unit of government for the purpose of selecting one pre-qualified Contractor from the pool of ten master contract holders. The local unit of government
LEEP Site-Specific RFP document template provided by the Minnesota Department of Commerce. Site-specific data is added by the local unit of government.
Parties to Site-Specific RFP
The local unit of government will issue the Site-Specific RFP to all contractors in the LEEP Master Contract.
The Work Order Contract is issued by the local unit of government to the selected Contractor for the purpose of conducting an Investment Grade Audit (IGA). This Work Order enables the Contractor to perform engineering services detailed in the Contractor’s Duties at prices agreed to in Contractor’s Fee Schedule.
Exhibit A –Contractor’s Duties for Investment Grade Audit
The Work Order Contract directs the Contractor to perform data collection, do a site walk-through, and provide a Preliminary Analysis and Recommendations Report of energy conservation measures to study in detail.
Exhibit B – Contractor’s Fee Schedule
These are the fees applicable to the performance of the Contractor’s Duties as specified in Exhibit A. These fees will be determined by the response to the local government’s Site-Specific Request for Proposals, and may be equal or less than the Contractor’s fee in their Master Contract with the Department of Commerce.
The Amended Work Order Contract is issued by the local unit of government to the selected Contractor upon acceptance of the Preliminary Findings and Recommendations Report as detailed in the original Work Order Contract. The Contractor will then perform duties as amended to complete a full Investment Grade Audit.
Exhibit A-1 –Contractor’s Duties for Investment Grade Audit
Exhibit A is amended to Exhibit A-1. A-1 adds the full Investment Grade Audit tasks as agreed upon acceptance of the preliminary recommendations. The final deliverable is a Final Investment Grade Audit Report.
Exhibit B-1 – Contractor’s Fee Schedule
Exhibit B is amended to Exhibit B-1. B-1 adds markups and fees applicable to the performance of the Contractor’s Duties as specified in Exhibit A-1. These fees and markups will be determined by the response to the local government’s Site-Specific Request for Proposals, and may be equal or less than the Contractor’s fee in their Master Contract with the Department of Commerce.