3. Staff briefing on the Austin Climate Revolving Fund — original pdf

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Climate Revolving Fund Update Joint Sustainability Committee | October 2 8, 2026 Agenda 1 Revolving Fund Background 2 Progress to Date 3 Organization & Operation 4 Roadmap for the Fund 5 Next Steps 2 Limited dedicated funds for climate action projects New opportunities in renewables + resilience Tight budgets increase the need to reduce operational costs Climate Projects as Investments 3 Climate Revolving Fund Directed by Council Resolution 20250813 - 022 City Manager Top 25 Goal for FY26 Pays for City projects that: 1) Reduce GHG emissions and 2) Create $ savings A virtuous cycle: savings are fed back into the Fund, which pays for more projects, and so on 4 Building Off Best Practices - An estimated 200+ Revolving Funds currently operate in the US - There are many well - established, successful models - We’re learning from them to get it right San Antonio Philadelphia Harris County Portland Seattle 5 Progress to Date Early 2026: Efforts to kick off the Fund begin (ACAR, AFM, ABOE) AFM hires Environmental Program Manager to partner on the June 2026: Fund ● CMO, ACAR, AFM, and ABOE align on a phased approach to establishing the Revolving Fund Adopted budget contains Revolving Fund seed money August 2026: ● $1 million in Certificates of Obligation and $500,000 in one ● Possible additional capital through energy efficiency rebates and AE (pending) ● Working to capture savings, revenue, and license payments from Solar on City Facilities - time cash (pending) September 2026: ● Revolving Fund Steering ● Progress update given Planning for early operations begins Committee forms , drafts SOP, develops project prioritization criteria to Climate, Water, Environment, Parks Committee 6 Revolving Fund Stakeholders Executive Advisors Awareness, project approval Steering Committee* Guide early operations, provide long - term strategic direction Council Committee on Climate, Water, Environment, Parks Buy - in, support, accountability AFM Parks Libraries Other Depts Implementing Departments In phase 2 and beyond, all departments contribute to the pipeline of Fund projects *Note: ACAR and AFM members will facilitate the Steering Committee, handle administrative workloads, and communicate with leadership and Council, with support from other members. 7 Climate Revolving Fund Steering Committee Climate Action & Resilience : • Phillip Duran, Braden Latham - Jones, Amanda Pfeil Facilities Management : , Sam Leonard , Jackson • Alison Baker Featherson Austin Energy : • Aiden Cohen , Greg Arcangeli Budget & Organizational Excellence : • Timothy Anderson The Committee will guide the launch and early operations of the Fund • Finalize Standard Operating Procedure • Set project prioritization criteria • Evaluate and select eligible projects • Review GHG and savings calculations • Coordinate across our departments to increase awareness and ensure ongoing Fund support • Facilitate long - term development of project pipeline • Explore additional funding opportunities 8 Standard Operating Procedure • • • • • • • Outlines financial management of the Revolving Fund Expenditure criteria, revenue generation, fund administration Establishes guidelines for measuring climate impacts and monetary savings Defines operational responsibilities, including the tasks and authorities delegated to the Steering Committee Sets Fund health and growth as the early priority Allows for revision as Fund operations mature Describes the annual report to CWEP Committee 9 Draft Project Selection Criteria Criteria What it measures Financial Value Payback period, annual savings, lifecycle savings, and ability to replenish the fund Climate & Environmental Impact Greenhouse gas and air pollution reduction and contribution to City climate goals Utility Efficiency Need & Readiness Reduction in electricity, gas, water, peak demand, or other utility use Clear operational need, scope, procurement path, and implementation schedule Community Benefit Benefits to essential services, historically underserved communities, staff, or community The Steering Committee will independently weigh and evaluate each project based on criteria, convene to review and finalize highest priority projects to support. 10 Simplified Steps for Projects Step 1: Develop Project Pipeline Step 2: Gather Details & Analysis Step 3: Evaluate & Select Projects Step 4: Fund & Execute Step 5: Capture Lifetime Savings Step 6: Revolve the Fund AFM Phase 1 Parks Libraries Other Depts Phase 2 & beyond Collect Project Details AFM, ACAR Independently Evaluate Projects Steering Committee Propose Projects To Steering Committee - Baseline Pre Project Energy Bills Convene to Select Projects Steering Committee Implement Project AFM, then Other Depts Estimate Savings, GHG Impact Consult Exec Advisors AFM, ACAR Leadership Capture Monthly Utility Savings* AFM Transfer Savings to Revolving Fund AFM *Utility budget or OpEx fee must stay at baseline level to capture savings Return to Step 1 11 Example Project: LED Light Retrofit $2,000,000 $300,000 $1,500,000 $150,000 $1,000,000 Annual Energy Savings Upfront Cost: $100,000 Estimated Annual Savings: Annual GHG reduction: Simple Payback Period: Lifetime of Asset: Total Return: $170,000 20 years $13,500 45 MT CO₂e 7.5 years Lifetime Project Cash Flow *As projects payback, utility budgets must remain stable, so extra savings accumulate for lifetime of asset full Project Cost $500,000 $0 $0 -$500,000 -$100,000 -$1,000,000 6 2 0 2 7 2 0 2 8 2 0 2 9 2 0 2 0 3 0 2 1 3 0 2 2 3 0 2 3 3 0 2 4 3 0 2 5 3 0 2 6 3 0 2 7 3 0 2 8 3 0 2 9 3 0 2 0 4 0 2 1 4 0 2 2 4 0 2 3 4 0 2 4 4 0 2 5 4 0 2 12 Plan for a Phased Approach Phase 1 Prove Concept Phase 2 Operational Expansion Phase 3 Long - term Aspirations Phase 1 (Years 1 - 2 ) Proof of concept phase Focus on Fund health and growth • • • Work at AFM facilities on energy efficiency upgrades • Refine and normalize Fund operations and processes • Work with all departments to develop a project pipeline Phase 2 • • • Expand fund operations to non Capture Solar on City Facilities Identify pilot projects outside of buildings - AFM facilities license payments Phase 3 • • Fund is healthy, supporting Pilot projects like fleet electrification or charging, nature - based solutions, and more high - value projects 13 FY27 - Phase 1 Timeline & Milestones September October 2026 - November – January 2027 2027 Planning & Prep First Projects Implement Pilots • Sept 23: Report to Council • Develop a list of potential • Construct initial projects CWEP on Progress projects • Finalize SOP • Finalize project selection criteria and process • Communicate with non AFM departments - • Collect data to evaluate potential projects • SC prioritizes and selects 3 projects to support • Monitor utility bills, capture savings in Fund • Refine and normalize Fund operations and processes 14 Takeaways • True interdepartmental collaboration and problem - solving • Very timely opportunity to reduce operating costs and improve facilities • Reframing of Climate Action as an investment with payback • We're planting a seed for the future , be patient 15 Thank you ! Phillip Duran Senior Climate Analys t phillip.duran@austintexas.gov austintexas.gov/climate