TUHSD June 14, 2011 Making Sustainability Work Jonathan Schwartz Manager, Asset Optimization Kris Waters, CMIR Investment Recovery Manager.

TUHSDJune 14, 2011

Making Sustainability Work

Jonathan SchwartzManager, Asset Optimization

Kris Waters, CMIRInvestment Recovery Manager

COX Operating Companies

Cox Conserves Commitment

• Reduce our annual companywide carbon footprint, or greenhouse gas emissions, by 20% by 2017

• Save 172,000 tons of greenhouse gas emissions annually - equivalent to the pollution produced by providing power to 26,000 homes

Sustainability

Three pillars of truly sustainable privatesector initiatives:

• Social: Community growth, non-profit support, job creation, education

• Economic: Financial return, cost savings, revenue generation,

return on investment, long term financial viability, risk management/mitigation, financial impact of climate change

• Environmental: Minimizing or offsetting waste, reducing carbon dioxide emissions, reducing non-renewable resource consumption

Private Sector Sustainability Drivers

• Primary business-driven motivators:– Reduce Risk– Reduce Costs– Increase or Preserve Revenue– Build Brand Value– Impact Local Markets– Increase Employee Engagement

Local Cox Conserves InitiativesSolar parking structures

• Currently installed at six Arizona facilities.

Sustainable facilities initiatives

• Reduce water, energy, and

natural resource consumption– Lighting– HVAC– Water fixtures– Print services

Fleet optimization • Home start• Vehicle size reduction

Sustainable Sourcing

• Sustainable business practices a consideration in sourcing events.

Telecommuting / Home Start

• Call center program where employees work from home.• Field program where employees start from home to reduce unneeded carbon impact

Investment Recovery • An end-of-life asset management program dedicated to reuse, resale, and recycling to optimize assets’ return on investment

• Redeploy or sell assets for reuse wherever possible• Sustainably recycle unusable assets to recover material value• Highlights asset’s value throughout its life cycle

Local Cox Conserves Initiatives: Investment Recovery

Local Cox Conserves Initiatives

• Office and field operations waste recycling– Paper– Plastic– Cardboard– Coaxial cable

• Reduced waste disposal costs• Proceeds reinvested in K-12 education

programs through Cox Charities

Sustainable Private Sector Jobs

• Facilities Management• Supply Chain Management• Investment Recovery Management• Network Operations / Engineering• Information Technology• Business Analysis• Finance

Digital Ballasts in Call Center

• Installed 800 new digital ballasts in our call center building• Enhanced dimming capabilities and “smart technology”

- Integration of occupancy and lighting schedules • Saves maintenance costs due to increased lifespan of lamps and ballasts

Business Case Analysis: Call Center Ballasts

Purchase and Installation Costs $140,000

Annual Savings 200,000 KwH ($0.11 / KwH)

APS Rebate $25,000

Annual savings in maintenance / replacement

costs$10,000

Project Timeline 10 Years

Business Case Analysis: Call Center Ballasts

Business Case Analysis: Call Center Ballasts

Simple Payback 3+ yrs

NPV (8% Discount Rate) $99K

IRR 34%

Additional Considerations

• Employee comfort

• Reduced carbon footprint

• Promote development and manufacturing of energy-saving technologies

10 Year Investment Analysis

ANALYSIS SUPPORTS A SUSTAINABLE STRATEGY!

Activity – Solar Power Purchase Agreements

Activity – SPPA

Project Timeline 20 Years

Annual Production 520,000 KwH

Power Cost Increase $0.06 per KwH

Rebates $0 (PPA provider retains)

Maintenance Savings $2,000 annually

Future Energy Cost Savings

$5,000 with 1% annual growth

Discount Rate 8%

Activity – SPPA

• With no extra revenue or benefit, what is the cumulative cash flow? What is the Net Present Value (NPV) at an 8% discount rate? – Formula:

• t - the time of the cash flow• i - the discount rate• Rt - the net cash flow at time t.

• How much revenue or benefit is needed to have a positive NPV?

• If a positive NPV is not achievable, what other considerations must be taken into account?

Activity – Solar PPA

Cumulative Cash Flow • ($474K)

Net Present Value (NPV) • ($234K)

Project Payback • No Payback

Environmental Considerations • Reduced carbon footprint

Social Considerations • Example to other private businesses

Non-Quantifiable Economic Considerations

• Public relations• Builds brand value• Local job creation

1. Sustainable practices often make business sense2. Don’t have to work in a traditional “green job” to

make a career of sustainability3. The field of sustainability is rapidly evolving4. Every waste stream has some level of value5. Creativity is critical to success in the sustainability

arena

Environmental, social, and economic sustainabilityis optimized by aligning personal values andbusiness drivers.

Curriculum Recommendations

?Questions?

Jonathan SchwartzManager, Asset Optimization623.328.3281 – [email protected]

Kris Waters, CMIRInvestment Recovery Manager623.328.3274 – [email protected]