HomeMy WebLinkAboutE-11 Staff Report - Replacement of City Hall HVACCONSENT ITEM
E-11
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
VIA: STEPHAN E. HUNT, CHIEF OF POLICE/ACTING CITY MANAGER
FROM: DANIEL BOBADILLA, P.E., DIRECTOR OF PUBLIC WORKS/CITY ENGINEER
DATE: JULY 17, 2017
SUBJECT: APPROVAL OF A CONTRACT WITH ICE ENERGY HOLDINGS, INC. FOR THE
INSTALLATION OF AN ICE BEAR THERMAL ENERGY STORAGE SYSTEM AT
CITY HALL
SUMMARY:
City Hall is a heavily used public building and additionally houses City employees. The existing HVAC
system is over 25 years old and has had multiple maintenance and repair issues over the last several
months. This action waives the competitive bidding requirements per Azusa Municipal Code Section 2-
520(b) and approves a contract with Ice Energy Holdings, Inc. for the installation of an Ice Bear
Thermal Energy Storage System and associated HVAC equipment at City Hall.
RECOMMENDATION:
Staff recommends the City Council take the following actions:
1) Determine Ice Energy Holdings, Inc. to be a sole source vendor based on proprietary thermal
storage technology as authorized under Azusa Municipal Code Section 2-520(b); and
2) Approve a contract with Ice Energy Holdings, Inc. to install an Ice Bear Thermal Energy Storage
System and associated HVAC equipment at City Hall; and
3) Approve funding for a not-to-exceed contract amount of $132,275.
DISCUSSION:
Azusa City Hall is a heavily used public building and also houses several City departments. The current
HVAC system is over 25 years old and has been experiencing a high rate of repair and difficulty
maintaining cooling demands over the last several months. The HVAC system has reached the end of its
APPROVED
CITY COUNCIL
7/17/2017
Approval of Contract with Ice Energy Holdings, Inc.
July 17, 2017
Page 2
useful life based on the costs associated with keeping it functioning and the fact that the required repairs
are not guaranteed to keep it functioning long term.
The Ice Bear thermal storage unit produced by Ice Energy is a proprietary distributed thermal energy
storage technology system that delivers fully integrated, smart grid-ready intelligent distributed energy
storage solutions for peak demand management. The smart grid platform combines Ice Bear distributed
mature energy storage technology with an advanced software infrastructure and intelligent two -way
control to provide utilities with a fully controllable, centrally operated, dist ributed energy resource. The
system was developed specifically for small to mid-sized commercial buildings and the Ice Bear works
in concert with existing package air-conditioning units.
Under Section 2-520(b) in the Azusa Municipal Code, when the City determines that only one vendor
“with singular characteristics or performances capabilities” can provide “unique commodities or
services” to the City, the purchase of those commodities is deemed a “sole source” purchase and is
exempt from the City’s competitive bidding requirements.
Ice Energy is a sole proprietor of the Ice Bear Thermal Energy Storage product designed for direct
expansion air conditioning systems. Ice Energy holds patents for the thermal energy storage systems
prohibiting direct competition in the air conditioning market space. Therefore, Ice Energy can be
classified as a sole proprietorship and is the only provider in the USA that can convert commercial and
industrial air conditioning load into clean and flexible resource utilities. Staff believes that the Azusa
Municipal Code cited above is applicable and that a determination that Ice Energy is a “sole source”
provider of these commodities being sought is justifiable.
A Self-Generation Incentive rebate of up to $28,350 is available through the Southern California Gas
Company, which Staff will submit an application once the installation is complete.
This contract also includes a provision for HVAC rental equipment in the event the existing HVAC unit
fails prior to permit approval and subsequent installation.
FISCAL IMPACT:
The recommended actions award a contract to Ice Energy Holdings, Inc. in the amount of $120,250 and
further authorizes Staff to amend the contract up to 10%, or $12,025, for a total not -to-exceed contract
amount of $132,275. The project will be funded with Azusa Light and Water Public Benefit Fund
Account 24. Staff will prepare a FY2017-2018 budget amendment after council approval.
Prepared by: Fiscal Impact Reviewed by:
Daniel Bobadilla, P.E. Talika M. Johnson
Director of Public Works/City Engineer Director of Finance
Approval of Contract with Ice Energy Holdings, Inc.
July 17, 2017
Page 3
Reviewed and Approved: Reviewed and Approved:
Louie F. Lacasella Stephan E. Hunt
Management Analyst Chief of Police/Acting City Manager
Attachments:
1) Quotation from Ice Energy
2) Purchase Contract with Ice Energy
3) Sole Source Letter from Ice Energy