Region: North America (NA)
Country: Canada
Sector: Energy and Power
Keywords: PPPs by Sector *, Energy and Power PPPs **, Canada, Street lighting
Document Link(s):
- Proven Delivery Models for LED Public Lighting: Joint Procurement Delivery Mode…
- Official Website of ESMAP
Document(s):
Document Details:
The Province of Ontario, in east-central Canada, consists of 444 municipalities and represents 13.6 million residents, or more than one-third of Canada’s population. Roughly two-thirds of these municipalities are small, containing fewer than 10,000 residents and fewer than 2,500 streetlights (luminaires); about 100 of the municipalities are mid-sized; and 41 are large municipalities of 50,000 residents or more. Almost all the province’s municipalities are dues-paying members of the nonprofit Association of Municipalities of Ontario (AMO), which helps to lobby the provincial and national government on behalf of municipalities. AMO has a wholly-owned nonprofit corporation, Local Authority Services, Inc. (LAS) that does bulk procurements of a number of commodities, products and services for AMO’s constituent municipalities, which comprise 360 of Ontario’s municipalities.
Several factors drove AMO to launch its LED lighting program. The high operating costs associated with Ontario’s public lighting—mostly high-pressure sodium (HPS) lamps, which consume a significant amount of electricity—were a key challenge. There are approximately 70 different utilities in Ontario, and each utility charges a different rate for electricity. Each rate is further divided into volumetric and fixed charges. In some small utilities’ coverage areas, volumetric charges are low and fixed charges are high, making it difficult for customers to save money by saving energy. In those towns, maintenance cost for old, HPS streetlights tend to be particularly high. For instance, in the municipality of Greenstone, in the remote northwest of Ontario, the nearest repair crews are at least three hours away by car, making it costly and slow to request service when lights break. The old infrastructure, which had not been updated for several years, only exacerbated the problem.
AMO and LAS were also driven by the activism of nonprofit groups such as LightSavers, an energy efficient street lighting advocacy organization. LightSavers secured the support of several key stakeholders such as Natural Resources Canada (Federal Ministry of Natural Resources), the Toronto Atmospheric Fund, and the Canadian Urban Institute. Together, they supported cities by offering training, publishing reports, and implementing pilots using funding from programs such as the Technology Development Fund.
Opportunities also encouraged AMO and LAS. For instance, as discussed in the next section, there were substantial federal incentives for energy efficiency, as well as provincial incentives established by the then Ontario Power Authority, now the Independent Electricity System Operator (IESO). Prices of LED lights were dropping steeply and cities were warming to the concept of joint procurement. After assessing their options, AMO and LAS chose to adopt the joint procurement model on behalf of their municipalities in order to (a) leverage their scale and buying power to secure lower prices and (b) relieve smaller municipalities of the burden of designing and managing a complex, two-stage procurement of energy services and luminaires. As of August 2015, 127 municipalities had participated in the LAS LED joint procurement, and more than 101,000 fixtures had been purchased. The first group of municipalities participating was virtually all small towns in northern Ontario, with an average of 300 luminaires per municipality. RealTerm Energy (RTE) had installed more than 25,000 fixtures in 40 municipalities, and expected to reach 75,000 by the end of the year. The remaining municipalities installing or expected to install by earlyto-mid 2016 will exceed 100,000 luminaires, for an average of nearly 1,000 luminaires per municipality.
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