2015-03-31 Planning & Organisation Committee Agenda

PLANNING & ORGANISATION COMMITTEE MEETING AGENDA                                  31 MARCH 2015


 Future savings in network demand charges if the power factor improves to 0.95 and kVA is
   reduced,
 Indicative capital costs for the supply, installation and commissioning of PFC units (provided
   by Council’s current electricity retailer), and
 Expected Energex subsidies.

The analysis produced an NPV for each site. A positive NPV indicates a financially sound
investment opportunity. Several sites returned a negative NPV, either an indication that
investment in PFC is not suitable, or due to the site already trending a power factor of 0.95 or
greater with no reason to invest in improved efficiency. Five (5) sites produced a positive NPV
over three years, totalling $15,833.

The indicative capital cost for investment at these sites is $34,500, reduced to $29,383 by
proposed Energex subsidies totalling $5,117. The present value of cost savings from more
efficient use of electricity is $45,216, demonstrating that the cost savings achieved in the first
three years after installation fully fund, and exceed the upfront capital cost.

These sites are:
 The J – Lot 2 60 Noosa Drive, Noosa Heads;
 Noosaville Depot – Lot 902 183 Eumundi Noosa Road, Noosaville;
 Lock and Weir system – 2 Mill Street, Noosaville;
 Leisure Centre – Wallace Park, 2 Eumundi Noosa Road, Noosaville; and
 Aquatic Centre – Lot 1 6 Girraween Court, Noosa Heads.

It is noted that an overall capital cost of $45,000 (reduced to $39,833 after the application of the
proposed Energex subsidies) would still achieve an overall positive NPV at the selected sites.
Given that the capital costs are indicative at this stage, the recommendation is for capital
expenditure up to a total $45,000 if required (as a positive NPV would still be achieved at each
individual site).

With respect to the capital investment in PFC equipment at the Noosa Waters lock and weir
system, the current levy would be used as a funding source given the ongoing electricity cost
savings will directly benefit those properties utilising the lock in the Noosa Waters estate.

Cost Benefit Summary

Figure 1 summarises the findings of the cost benefit analysis, highlighting that annual cost
savings in the magnitude of $15k per year will continue even after the initial capital investment is
fully compensated by cost savings in the first 3 years.




Figure 1. Cost benefit summary




                                                                                     Page 12 of 53