City of Richmond sets up new company, revenue stream
An entirely new revenue stream will begin flowing into Richmond City Hall through a new city-owned corporation, council decided Monday.
The Lulu Island Energy Company will collect fees for heating and cooling as many as 3,100 homes and 1.1 million square feet of commercial space in a redeveloping area of West Cambie. The city will be the company’s sole shareholder.
The energy is being generated by a new geothermal system—the Alexandra District Energy Utility—created by the city and area builders.
“I believe this is on the leading edge of sustainability,” said Coun. Bill McNulty. “I think other communities in North America are going to see what we’re doing.”
Geothermal systems provide heating and cooling by capitalizing on the earth’s temperature through a series of liquid-filled underground pipes. The technology is employed in some new buildings, including the Hamilton fire hall and BCIT Aerospace Campus, but this is the first time it’s been used by an entire neighbourhood.
“This reduces greatly the energy that’s consumed in terms of natural gas and in terms of electricity for the homeowners and businesses in that area,” said Robert Gonzalez, general manager of engineering.
Gonzalez said Monday 380 geothermal wells have been drilled for the Alexandra utility, which has the ability to expand with the neighbourhood.
Council has already authorized spending $6 million on the project, cash expected to be paid back with interest from service fees. To power the entire neighbourhood—expected to be built out over the next 15 years—the system will require a total capital investment of $24.2 million. Staff have been authorized to explore the possibility of borrowing for future phases.
Coun. Evelina Halsey-Brandt said the governance model of a wholly owned city corporation is one that’s proved itself at the Richmond Olympic Oval.
Said Halsey-Brandt: “It transfers the risk away from the city, and yet we still have full control over it. And we will also be able to set the fees for the energy that’s being created.”