Environment Metro Louisville

In his first year, Louisville’s energy czar saved the city more than $700,000 in utility costs. Now, Metro Council wants the city to invest the savings back into green initiatives.

Council members unanimously approved creating the Energy Innovation Fund at their meeting Thursday night. The fund will finance projects that reduce Louisville Metro Government’s carbon footprint, resulting in energy cost savings. Eighty percent of those savings will then be put back into the fund for future projects, furthering the savings-into-investment cycle.

Zach Tyler, the city’s first energy manager, said the Energy Innovation Fund will essentially allow Louisville to finance green initiatives through the success of previous projects. Tyler said it will also help the city meet its goal of 100% clean energy for government operations by 2030.

“The advantage of this format is that it does not require any large, arbitrary investment up front, but instead establishes a process that will modernize our equipment in a way that is better than budget-neutral,” he said at a recent Metro Council Parks and Sustainability Committee meeting. “These are measures that produce immediate cost savings, as well as long-term cost savings that can gain momentum over time.”

The Energy Innovation Fund is expected to be up and running later this year. It will start out with around $550,000, or 80% of the energy savings Tyler helped Louisville create last year.

Tyler told WFPL News last month that he saved the city roughly $750,000 through some basic operational improvements like changing the automated schedules for boilers, chillers and pumps in the largest public buildings. He estimated the city owns between 200 and 300 buildings.

In addition to saving money, the changes amounted to energy savings equal to what it would take to power 700 homes for a year, Tyler said.

Under the resolution approved by Metro Council, 70% of the money in the Energy Innovation Fund will go toward projects that would pay for themselves within six years. That includes changes such as upgrading HVAC systems or swapping out a building’s traditional incandescent bulbs for LED lights.

The remaining 30% of funds would be split between longer-term, more expensive upgrades like solar panels, and studies or audits that help identify future projects.

Tyler estimated the city’s energy savings will grow quickly over the next few years as the city addresses “low-hanging fruit.”

“There’s a lot that needs to be done and the $700,000 [in 2021 savings] is really just scratching the surface,” he said.

But Tyler added that  as Louisville Metro makes new investments in reducing its carbon footprint, additional opportunities for easy energy savings will dry up. The fund is designed to be phased out as the city’s operations become more efficient, he said.

The resolution creating the Energy Innovation Fund was sponsored by District 9’s Bill Hollander and District 21’s Nicole George, both Democrats.

Hollander has called the city’s recent energy reduction efforts “a real success story,” and said the fund will help it do even more.

“You could just take those savings and spend it on something else, but we think it is so important that we need to keep investing in being more efficient and reducing our carbon footprint,” he said.

Hollander, who chairs the Council’s Budget Committee, said the fund should relieve some of the pressure on the city’s capital budget, which relies primarily on bonds and grants. The fund can pay for smaller efficiencies, while officials can use the capital budget to focus on costlier projects like weatherproofing buildings and installing solar panels.

A number of council members have publicly floated the idea that the city should invest in installing a renewable energy system on the AT&T building, which Louisville Metro recently purchased to house the police department’s headquarters.

Last year, Mayor Greg Fischer signed an executive order directing city departments to prioritize buying electric and hybrid vehicles to replace gas-powered vehicles. The order also required organizations with larger city contracts to commit to reducing their carbon footprint and provide officials with a plan for how they will do that.

On-road transportation accounts for nearly 13% of Louisville’s greenhouse gas emissions, according to a news release from Fischer’s office.

Roberto Roldan is the City Politics and Government Reporter for WFPL.