AGENDA TITLE:
title
Adopt a Resolution Authorizing Interim City Manager to Execute Five-Year Professional Services Agreement with Efficiency Services Group, LLC of Hillsboro, OR for Energy Program Administration, Implementation and Support ($2,388,784) (EU)
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MEETING DATE:
June 3, 2026
PREPARED BY:
Melissa Price, Assistant Electric Utility Director
recommendation
RECOMMENDED ACTION:
Adopt a resolution authorizing the Interim City Manager to execute a five-year Professional Services Agreement with Efficiency Services Group, LLC of Hillsboro, OR for Energy Program Administration, Implementation and Support in an amount not-to-exceed $2,388,784.
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BACKGROUND INFORMATION:
Since 2014, Efficiency Services Group, LLC (ESG) has served as Lodi Electric Utility’s (LEU) third-party administrator of its public benefits energy efficiency (EE) program.
ESG continues to provide a number of turnkey services including energy audits, direct installation of energy efficient fixtures, customer rebate processing, energy savings analysis and consultation for commercial and industrial accounts, program development and training of customer service staff, monitoring of legislative and regulatory changes in the industry, review and processing of applications for low-income assistance under LEU’s CARE Program, representation at NCPA working groups, and energy efficiency and compliance reporting.
The current Professional Services Agreement (PSA) with ESG expires on June 30, 2026. For over 10 years, ESG has helped deliver $6.5 million in rebates to its customers. LEU programs administered by ESG have provided over 27.5 million kilowatt hours of energy savings - enough to power over four thousand homes in California for a year. In addition to continuing to provide EE program administration, ESG has helped LEU develop and expand its Electric Vehicle (EV) rebate program.
Funding for each year of the new PSA is provided below with an average annual cost of approximately $480,000 per year which includes on average $340,000 in direct customer rebate incentives. The proposed contract includes a small inflationary adjustment of 3% per year for program administration, increases to direct customer program payments for the DIY Commercial Install Program based on increasing demand, as well as additional programming dollars to help identify and develop eligible activities to support the Downtown Specific Plan and Economic Development Strategy.
|
Activity |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
|
Program Administration |
$115,296 |
$118,431 |
$121,660 |
$124,986 |
$128,411 |
|
CARE |
$6,000 |
$6,000 |
$6,000 |
$6,000 |
$6,000 |
|
Marketing/Expansion |
$11,000 |
$11,000 |
$11,000 |
$11,000 |
$11,000 |
|
Direct Install |
$500,000 |
$300,000 |
$300,000 |
$300,000 |
$300,000 |
|
Total |
$632,296 |
$435,431 |
$438,660 |
$441,986 |
$445,411 |
ESG provides many of these same services to other members of the Northern California Power Agency (NCPA), and as a result, members including LEU benefit from economies of scale where costs are shared. Equally important are the efficiencies realized in terms of mandatory State compliance reporting provided by ESG for NCPA member agencies. ESG has consistently demonstrated its effectiveness in the field, its ability to maintain confidential customer data, its expertise and resource availability in the energy industry, responsiveness to both the needs of LEU staff as well as its customers and continues to maintain an excellent working relationship with LEU as well as key commercial and industrial customers as it relates to both short- and long-term energy efficiency planning, projects and goals.
Therefore, in accordance with Lodi Municipal Code, Section 3.20.070, staff requests that City Council waive the bid process and authorize approval of the five-year PSA with ESG as LEU’s energy services administrator as outlined above.
FISCAL IMPACT:
Total five-year cost is not-to-exceed $2,388,784, approximately 70 percent of which is programmed as direct incentive payments to customers under direct install efforts.
FUNDING AVAILABLE:
Funding for this PSA will be included each year in the Public Benefits Fund 504 and Greenhouse Gas Fund 508 as part of the annual budget process starting in Fiscal Year 2026/27.