Eastern Michigan University enters innovative utilities partnership to support sustainability efforts, establish new revenue stream for academic, retention, and enrollment efforts

YPSILANTI, Mich., April 20, 2023 /PRNewswire/ -- Eastern Michigan University's Board of Regents today (April 20) gave approval to the University to finalize an innovative utilities and infrastructure partnership that will deliver significant and lasting enhancements to the overall campus experience for students, faculty and staff. The partnership will generate a multi-million-dollar influx of outside funds to the University to:

• Further support Eastern's strong sustainability efforts and energy conservation measures, while making the University even more "green";
• Provide immediate and long-term solutions to deferred maintenance of older buildings and modernize the aging utility infrastructure; and,
• Create a continuous income stream to support academic programs and strategic enrollment and retention initiatives, while including a distinctive opportunity for students, faculty and staff to develop projects to support enrollment and retention objectives.

"The higher education environment is as challenged as it has ever been in my 14 years as a university president," said Eastern Michigan University President James Smith. "Institutions must become nimbler and more creative than ever to identify new sources of revenue to invest in student and employee success.

"This innovative initiative will deliver significant and sustainable enhancements to the overall campus experience for students, faculty and staff. The University will immediately begin working to implement the full scope of projects under this partnership, with some of the enhancements taking place within a matter of months. Others will roll out over time in the months and years ahead and will benefit the University for decades in the future."

Similar partnerships have been formed at universities across the country, such as Ohio State University, University of Iowa, Georgetown University, University of Idaho, Louisiana State University.

How it works

Eastern Michigan University has entered into a 50-year partnership with Eagle Energy Partners, a consortium consisting of CenTrio Energy, Noresco, and Burns & McDonnell, all of which bring deep energy-sector expertise to modernize utility systems and improve sustainability efforts.

Eastern and Eagle Energy Partners have identified a series of projects that will result in reductions in energy use and in operating costs, while enhancing the redundancy and reliability of the University's electrical grid and its capacity.

Under the agreement, Eastern will receive approximately $115 million (final amount to be determined on financial close later this summer) to address the following needs:

• Reduce existing University debt by $25 million, which will generate approximately $1 million in annual debt service savings.
• Provide $90 million for the University to establish the Strategic Initiatives Fund, which is projected to generate $5 million annually in investment returns.

Other key elements of the partnership:

• Eagle Energy Partners will invest $20-25 million of its own funds in immediate infrastructure improvements, which will generate approximately $900,000 annually in utility and operations savings for the University.
• Eagle Energy Partners will invest $26 million of its own funds (pending final agreements) in energy conservation projects, which will generate $1-1.5 million in annual utility and operations savings for the University.
• Eastern will pay Eagle Energy Partners $5.3 million annually to manage, operate, maintain and improve the University's utility infrastructure.

Taking into account the investment returns, debt savings, utility and operational savings, and the University's payment to the partner, the overall annual net benefit to the University will be $2.7 - 3.2 million.

Eagle Energy Partners was selected for the project by Gilbane, EMU's master developer. Gilbane is the construction and development firm leading the University's new $200 million residential housing transformation, "Welcome Home 2025."

Strategic Initiatives Fund

The $2.7-3.2 million in annual net benefit to the University generated by the partnership will be used to support faculty and academic programs; student persistence and retention; and, enrollment and student recruitment efforts.

A portion of the $2.7-3.2 million will be dedicated to a campus-wide effort to seek proposals from departments and offices to fund initiatives that are designed to help accomplish goals outlined in the University's Strategic Plan and/or increase student enrollment.

The University's Budget Council offered suggestions for how such a proposal process could be designed and implemented. Once the process is further developed, which is expected to be finalized this fall, details will be communicated to campus.

Impact of energy efficiency and conservation measures

Under the partnership, Eastern will realize an estimated 217,000+ MMBtu reduction (MMBtu is an abbreviation for one million British thermal units). This projection is based on the approximate 35% reduction in natural gas and electrical consumption under the plan for the entire campus. This reduction is equivalent to the following:

• Greenhouse gas emissions from 2,500+ gasoline-powered vehicles for one year
• CO2 emissions from 1,340,000+ gallons of gasoline consumed
• CO2 emissions from 2,300+ homes' electricity use for one year

EMU expects to see, over time, an improvement to its STARS Rating (Sustainability Tracking Assessment & Rating System). EMU was awarded a Bronze rating in 2022, placing the University in the top 5% of colleges in the U.S. for sustainability efforts. Projections indicate that under the partnership there is a potential to improve the rating from Bronze to Gold, nearly doubling EMU's score.

Under the partnership, certain infrastructure improvements will begin immediately. For additional details and a list of benefits for students, please visit the University's utilities and sustainability partnership website.

The University's facilities team will continue to support the campus utility infrastructure and buildings as it currently does due to its deep understanding of the system. The six EMU employees who work in the Energy Center will have the opportunity to remain employed by EMU working in the Energy Center or begin working for the partner – the choice rests with each employee.

About Eastern Michigan University
Founded in 1849, Eastern is the second oldest public university in Michigan. It currently serves more than 14,000 students pursuing undergraduate, graduate, specialist, doctoral and certificate degrees in the arts, sciences and professions. In all, more than 300 majors, minors and concentrations are delivered through the University's Colleges of Arts and Sciences; Business; Education; Engineering and Technology; Health and Human Services; and its graduate school. National publications regularly recognize EMU for its excellence, diversity, and commitment to applied education. Visit the University's rankings and points of pride websites to learn more. For more information about Eastern Michigan University, visit the University's website. To stay up to date on University news, activities and announcements, visit EMU Today.

SOURCE Eastern Michigan University