Megaproject 900: Preferred bidder to manage Ohio University’s energy systems

Megaproject 900: Preferred bidder to manage Ohio University’s energy systems

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The Ohio State University has selected a preferred bidder for a 50-year concession and lease contract for energy management services.

The Comprehensive Energy Management Project would modernize the 485-building Columbus campus and create substantial academic benefits for our students, faculty and staff.

The consortium comprised of ENGIE North America and Axium Infrastructure would operate the systems that power, heat and cool the Columbus campus and install energy conservation measures campus-wide to meet the university’s sustainability goals.

In return for a 50-year lease, ENGIE-Axium would pay Ohio State a total value of US$1.165 billion includes a US$1.015 billion upfront payment to the university and a US$150 million commitment to support academics in specific areas requested by students, faculty and staff during the bidding process.

The proposal includes the establishment of a US$50 million Energy Advancement and Innovation Center for energy research and technology commercialization. The center would create a hub where faculty members, students, alumni, ENGIE researchers, local entrepreneurs and industry experts work together on the next generation of smart energy systems, renewable energy and green mobility solutions.

Ohio State would pay ENGIE-Axium an annual utility fee that includes three elements: an operating fee to cover costs (starting at US$9.2 million based on a three-year average of university costs), a fixed fee that starts at US$45 million and grows 1.5 percent a year, and a financial return for any capital investments it funds at the university.

The project encompasses four major components:

  • The operation and maintenance of the utility system
  • Procurement of the energy supply for Ohio State's primary campus
  • Implementation to achieve energy savings goals for the Columbus Campus, which could include for example energy conservation measures (ECM)
  • The development of an affinity relationship with Ohio State and its stakeholders

The utility system is composed by: electric supply management and distribution system, chilled water system, steam and condensate system, natural gas supply management and distribution system and geothermal system.

As we reported in late March, three teams submitted bids for the project. Aside from the above mentioned consortium, Brookfield Asset Management - Enwave District Energy and Macquarie Corporate Holdings - Veolia Energy Operating Services responded to the RFP.

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