Palo Alto Weekly

Spectrum - April 23, 2010

Editorial: Cost savings are part of greening Palo Alto

Staff report cites actual reduction in costs from implementing greenhouse-gas-reduction program — good news in a financially hard year

When Palo Alto city officials adopted a program to reduce "greenhouse-gas" emissions in late 2007, saving the Earth from potentially catastrophic climate change was the primary priority, not saving money. And they've taken flak from some who object to the city spending any resource on such a broad global issue.

But a new staff report — presented Monday night to the City Council, appropriate to Earth Day this week — discloses that significant cost savings of about $530,000 were achieved in 2009 (compared to a base year of 2005) in consumption of electricity, natural gas and paper and in generation of solid waste.

Sadly, the savings were mostly offset by increases in the city's use of gasoline, diesel, compressed natural gas and water, leaving a net savings of about $185,000.

Yet the larger figure shows that savings can be substantial. The city needs to investigate and correct why the cost increases occurred. Did someone not get the message about city priorities?

Cost of implementing the new programs were minimal except for several million dollars for new equipment, lighting and energy-efficiency upgrades, which have relatively quick payback in savings from reduced consumption of energy and materials.

Overall, the city more than doubled a 5 percent goal set for 2009, achieving a 10 percent savings, according to the report. The council voted to boost an earlier goal for emission reduction to a more ambitious 20 percent, also based on 2005 levels. Some council members wanted to go for 30 or 40 percent, perhaps pushing the limits of achievability and credibility.

In addition to cutting "greenhouse gas" emissions from municipal operations, officials hope to reduce such emissions citywide by 5 percent by 2012. This will entail creating an effective outreach and motivation program to engage schools, businesses, organizations and residents. Both the new city-operations goal of 20 percent by 2020 and citywide goal of 5 percent by 2012 will be significant challenges, according to the detail-laden staff report (CMR:194:10 on www.cityofpaloalto.org).

A major initial success is in the implementation of a computer-based monitoring system, from local vendor Hara Software, that enables tracking of usage levels, cost savings and progress on a monthly basis by department or section of the city. So a key tool is in place with which to build a manageable program.

Opportunities are immediate. The report cites a recent City Auditor's report that disclosed inefficient use of city vehicles allocated to departments, and recommends reorganizing the city fleet into a "pool" setup to maximize usage and reduce overhead costs of acquisition and maintenance. It is unsettling that it took an auditor's report to uncover such an obviously wasteful practice that has existed for years. Perhaps the city should auction off the underused vehicles to fund current reduction efforts.

Yet the real import of Monday night's staff update is not in the details but in the section that looks to the future — where some blunt conclusions are presented in carefully chosen words.

Based on the staff analysis, "several programs need to be reassessed in order to achieve the goals recommended in this report," while keeping the city's fiscal crisis in mind, the report states. The city must change "the business-as-usual practices with city operations while enhancing the incentives and rewards system to capture cost savings," it states.

The report urges "empowering employees" to implement changes by improving flexibility, recognition, funding and senior management support: "Many employees recognize changes in operations that could significantly cut costs," the report notes. But, it warns, "Implementing such changes faces bureaucratic impediments, lack of funding mechanism, and departmental silos. To continue to reduce costs, the City needs to help employees break through these barriers."

A key recommendation is to create a barrier-busting "cross-department team reporting directly to the City Manager's office with limited funding for high return-on-investment projects and the authority to implement actions that would achieve both objectives" of cutting emissions and reducing costs by supporting department-level initiatives from employees.

The observations about "departmental silos" and bureaucratic barriers deserve to be posted on the wall of the City Council chambers as a reminder that there is urgent work yet to be done, and that the council must provide both strong leadership and support for staff efforts to achieve meaningful results.

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