Full steam ahead: UND breaks ground on new steam plant
UND and its private partner Johnson Controls are moving full steam ahead on a new utility plant for the university. The university held a groundbreaking for the new central utility plant Tuesday, with representatives from the university, Johnson ...
UND and its private partner Johnson Controls are moving full steam ahead on a new utility plant for the university.
The university held a groundbreaking for the new central utility plant Tuesday, with representatives from the university, Johnson Controls and other city and state representatives on hand to talk about the new plant and what it means for the school.
"It's a huge enhancement of the campus," UND President Mark Kennedy said.
The facility would cost $75 million in total, with $50 million of that for the plant itself and $25 million for the building's mechanical equipment. Kennedy said the ultimate investment value could be closer to $90 million. But, instead of going to the state for the extra money to fund the project, UND will be forming a public-private partnership while using the money that is already allocated to the school annually.
The facility will be operated and maintained by a third party, Johnson Controls, under a long-term capital lease agreement. The agreement will last around 40 years.
"My vision was that it was always a public-private partnership," Kennedy said. "My vision was that we're not in the steam plant business."
The new plant will be completed by spring 2020, with the old plant shut down by that fall, said Chuck McGinnis, performance infrastructure vice president of sales with Johnson Controls.
The current steam plant, which was built in 1909, is a critical support building and is in the worst condition of UND's buildings, facilities head Mike Pieper told the a state higher education committee earlier this year.
Sen. Ray Holmberg, R-Grand Forks, congratulated the university for finding a solution to the heating plant issue while staying in the school's current budget allocation and also tackling a large piece of their deferred maintenance costs.
"State resources should be focused on the classroom and the research, not on a project that private sector was willing to fund," Holmberg said.
The plant was identified in 2014 as being in need of major capital investments and rose as a priority through planning initiatives carried out in 2016. Those plans suggested a $20 million set of boiler repairs and replacements.
McGinnis said Johnson Controls got involved with the project after discussions with UND officials about the challenges of operating the old facility.
"The efforts by the existing staff at the University of North Dakota have been incredible that they've been able to operate this old plant as long as they have, but it's really on its last leg," he said. "The timing couldn't be better to be kicking off the groundbreaking to build a new, central steam plant."
He said the company has about 40 similar ongoing public-private partnerships with organizations across North America, which means it won't require any taxpayer-funded capital and lets organizations like UND to enter into a contract that will allow them to spend less money annually on what they already do.
"It's going to open up some new space on campus in a very critical area of campus and it will provide much more reliable steam service for many, many years to come," McGinnis said.
The new plant would be smaller than the old one by about 12,000 square feet. Additionally Kennedy said there would also be environmental benefits to a new plant.
The new facility would reduce the campus's carbon dioxide emissions by about 40,000 metric tons a year and would also reduce landfill space taken up by ash produced by the current plant, Kennedy said.
Kennedy says these reductions are the equivalent of taking 8,600 cars off the road and the carbon sequestration would equal about 74 square miles of forest, or the size of Grand Forks and Fargo combined.
The new plant will also help the university chip into the "mountain" of deferred maintenance on campus, as more energy-efficient infrastructure will also be introduced on campus.
Discussions about the plant have been ongoing for several years, including when Kennedy interviewed for the president's position and he questioned why the university had such a large steam plant on campus.
Kennedy said in order to continue being the flagship university of the state, the school needs to continue to focus on teaching, discovery and service, rather than things like a steam plant.