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Agreements with Powerlux Corporation, for LED Streetlight Improvements June 17, 2014 Page 3 Staff recommends awarding the contract to design and construct the street lighting upgrades to California Professional Engineering, Inc., the lowest bidder, in an amount not to exceed $512,450. Staff is also recommending purchasing the 231 post top LED streetlights needed for this project directly from Powerlux Corporation, at a 30 percent savings, through an amendment to the existing agreement in the amount of $78,506. The estimated total project cost is $610,956, which includes a $20,000 contingency (Exhibit 2). Modernizing these high - voltage circuits is a complex and costly undertaking. To supplement and leverage City funds, staff has applied for the OBF financing successfully used in previous LED replacement projects. Because of its energy efficiency components, this project is eligible and has received preliminary SCE approval for funding totaling $202,349: $183,919 in OBF financing; and $18,430 in energy efficiency cash incentives, a benefit of the City's participation in the SCE Energy Leader Partnership. Due to the high cost of rewiring the North Park circuit, a ten -year payback period is projected for the OBF- financed portion of the project cost. All SCE funding amounts are preliminary estimates. Final SCE funding will be based on actual energy savings measured after the project is completed. In anticipation of greater energy savings than expected, staff is recommending recognizing up to $230,000 in SCE funding. Funding for the remaining $408,607 is budgeted in the General Fund Street Lighting account (Exhibit 2). Replacement of the incandescent lamps with energy - efficient LED streetlights will reduce the City's estimated annual energy consumption by over 67,000 kWh. At the end of the OBF payback period, this project is estimated to reduce General Fund energy costs by approximately $10,590 annually. ENVIRONMENTAL IMPACT A Categorical Exemption (ER- 2014 -26) has been filed for this project, FISCAL IMPACT Loan proceeds received through the SCE On -Bill Financing Program will be deposited into the SCE Energy Efficient Street Lighting revenue account (16217002 - 57384) and appropriated into the SCE Energy Efficient Street Lighting expenditure account (16217630- 62300). Funds for the balance of the project are available in Account 01117630- 66220. Loan repayments are available in Account 01117630- 62000. � a_d2 Edwin "William" 'G vez, P.E. Interim Executive Director Public Works Agency EWG /KW APPROVED AS TO FUNDS AND ACCOUNTS: Francisco Gutierrez Executive Director Finance & Management Services Agency - 2501-21