Project 58

Project Name

Formal business case: commercialization of thermal energy services in the National Capital Region (stage III)

Client

Public Services and Procurement Canada (PSPC) – Energy Services Acquisition Program (ESAP)

Duration

April 2023 to March 2024 [Delivery Based]

The Energy Services Acquisition Program (ESAP) undertake a review of its business structure to addresses concern that current organisation structure partially delivers some business results or meet the government’s objectives. The purpose of this initiative is proactively response to an evolving environment:

o    The government is rationalizing its property holdings – Leading to an increase in building energy efficiency and a potential loss of connected buildings translating into a reduction ESAP’s revenue base

o    Buildings privately owned are under a push to decarbonize, partially in response to Federal GHG emission reduction targets for leased facilities and other tenant expectations

o    The government is focusing on building decarbonization expanding ESAP’s potential role and importance

Based on the feasibility study developed in 2019 (see mandate 52), authorization to proceed with the development of a formal business case was delay due Coronavirus disease pandemic and re-organisation at the senior management of PSPC.

Considering the favorable result of the previous assessment of the addressable market demand (see mandate 57), the purpose of the formal business case was to obtain an independent review from an external consultant and seek support from the central agencies being Privy Council Office, Treasury Board, Finance and Department of Justice

This business case is validating which organisation structure will fulfill the Political, Economic, Sociological, Technological, Legal and Environmental challenges to commercialized on a larger scale low-carbon thermal energy beyond the current market segment comprised of the federal government.

Based on 4 organizational structure options identified in the previous high-level feasibility pre-business case analysis (mandate 52):

1.      Status-Quo (currently a Departmental Organization)

2.      Subsidiary of Existing Crown Corporation (non-agent status)

3.      New Parent Crown Corporation (Agent Status)

4.      Joint Enterprise

•        Identify the business needs and desired outcomes taking into considering the existing strategic environment in term of strength, weaknesses, opportunities and threats (SWOT).

•        Participate to procurement of Professional Services to analyze short-listed options

•        Debriefing of Central Agencies consultation (Privy Council Office & Finance, Treasury Board Secretariat, Department of Justice)

•        Participate in industry sounding session with existing and prospective customers

•        Perform comparative analysis to assess DES contribution against LEED v4 or Green Globes life cycle assessment.

•        Participate and contribute to series of session touching the following topic:

•        Risk Assessment analysis

•        Value for Money analysis

•        Political, Economic, Sociological, Technological, Legal and Environmental (PESTLE) analysis

Lead the development of:

•        Update strength, weaknesses, opportunities and threats (SWOT) based on the business needs and desired outcomes.

•        Dynamic Rate Model for thermal energy for heating and cooling based on fixed rate tier system combine with a variable rate for low-carbon emission.

•        Financial modeling simulation tool to validate long-term the financial sustainability of ESAP District Energy through various network expansion scenarios.

•        Participate to the development of a generic Thermal Energy Service Agreement followed by specific schedule reflect specific building energy profile.

•        Review and establish data governance of Financial Modeling simulation tool and Thermal Energy Rate model

•        Facilitate the integration of Current and Prospective ESAP client’s energy profile in an existing Graphical Information System

•        Participate to official presentation to PSPC senior management

•        Lead preliminary due diligence exploration with Canada Lands Corporation as potential crown corporation subsidiary

Tomasz Smithy-Sowa

Senior Director

Telephone: 613-736-2644

email: tomasz.smetny-sowa@tpsgc-pwgsc.gc.ca

Patrick Girouard

Project Director

Telephone: 343-551-0990

email: Patrick.Girouard@tpsgc-pwgsc.gc.ca

Energy Services Acquisition Program (ESAP)

Public Services and Procurement Canada

2720 Riverside Drive

Ottawa, ON

K1A OS5

Technological platform leverage during this mandate