A NOTE FROM KEN
Downtown Saint Paul and its community have always been at the forefront of the District Energy St. Paul service model and value system. Our partners and community members continue to set a tone of quality, longevity, and loyalty for our service to customers. My favorite part about looking back on each year of service is recognizing that even as we grow and expand our technology, District Energy has always stayed true to its original values. I know that the District Energy team will continue to find innovative solutions to new challenges using the same foundational principles of reliable service and customer care that established this system as a leader in the industry as well as a true asset to the Saint Paul community.
From its inception, District Energy has integrated fuel flexibility with the idea that the energy industry will continue to shift and evolve. In 2022, we saw a shift in conversations around global energy availability. This year, District Energy was able to leverage our biomass resources to ease the rising costs of natural gas for our Saint Paul customers. Additional efforts this year included distribution system maintenance projects and renewed in person customer engagement. As the broader energy system transformation continues, District Energy has the ability to adapt and find creative solutions that best serve our customers, partnerships, and community.
As I look back at 2022 and into the future of the system, I am continuously reminded of the foundations put into place in 1983, and how they still serve as the guiding principles for our dynamic system today. The adaptability of the system that we have today is a direct reflection of the forward-thinking ideas that were incorporated into its design 39 years ago. I look forward to continuing to build on the foundation we have to envision an even brighter energy future for Saint Paul.
President and CEO
Our customers are core to the work that we do every day. We were eager to bring customers back together and show them how much we value them. At our Customer Appreciation event in Rice Park we gathered with customers to enjoy ice cream and lovely weather. It was great to see the customer contacts that we work with regularly as well as downtown employees.
This year we also returned to our in-person Operating Engineers Seminar in November, which provided our customers with information on distribution projects, engineering support, and resources available to help with energy efficiency and energy usage tracking. In addition to in-person events and seminars, this year our team offered online Customer Portal trainings to help customers with energy benchmarking as well as the opportunity to apply for our Energy Efficiency Program to receive financial and engineering assistance with projects designed to increase building efficiency
The 2022 Customer Appreciation event took place in Rice Park downtown where customers and community members were invited to enjoy ice-cream and conversation with the District Energy team.
Hot Water Pipeline Project
At District Energy, a key to our long-standing quality service is proactive and preventative maintenance. Our team prioritizes keeping our systems in top working order to support reliable service and optimize efficiency. This approach extends beyond our boilers, chillers, and pumps to our hot water and chilled water distribution system. This year District Energy worked on several distribution projects that focused on connecting new customers and implementing new technology to improve the system. In addition, the team also identified pipe repair and replacement to maintain our high reliability for customers and to minimize disruption to the downtown community.
District Energy work in 2022 included reconstruction of service vaults and replacement of over 900 feet of hot water pipe on 6th Street between Cedar Street and Wabasha. This project is a part of the ongoing effort to monitor pipe conditions and analyze specific areas for issues. Based on that analysis and isolation points in the network, our team determined which areas would benefit from pipe replacement or repair and at what time that work should be prioritized. Proactively identifying and replacing these pipes allow time for our team to organize a planned service outage, reducing cost and customer impacts while allowing construction to be done in the summer months when it is less disruptive to businesses in downtown.
Gerry Gubash, Distribution Services Manager noted, “We have been completing projects that are firsts in District Energy’s history, such as vault reconstruction, vault conversions to direct bury, and now proactively replacing larger sections of sections of pipe in the hot water network.” Looking forward, this pipeline project along with other system upgrade plans will continue to be a priority for District Energy with the goal of maintaining and bettering the system so that it can continue to reliably serve the Saint Paul community for many years to come.
Before and after photos of a N10:1 vault conversion in downtown Saint Paul.
“We have been completing projects that are firsts in District Energy’s history, such as vault reconstruction, vault conversions to direct bury, and now proactively replacing larger sections of sections of pipe in the hot water network.”
Gerry Gubash, Distribution Services Manager
District Energy welcomed Education Minnesota to the system this summer. Education Minnesota advocates for public education by supporting more than 80,000 teachers and support staff serving students from kindergarten through college. The organization is located north of the capital and the building was previously heated with a natural gas fired boiler. Connecting Education Minnesota to the system in 2022 provided an economically competitive opportunity to replace aging equipment. Additionally, the Education Minnesota offices now benefit from a more sustainable and reliable network for all of their heating requirements
We are excited to welcome Education Minnesota to the District Energy system. Our team is committed to providing high-quality service to all of our customers, and we are proud to be able to extend our services to this important institution.
Named Director Emeritus
Over the last 39 years, community leaders and energy system experts from around the world have reached out to our team to learn about the success and challenges from District Energy St. Paul’s experiences. A key piece of advice that we have always shared is that to build big and innovative projects, you need local champions. Champions are the ones driving the bandwagon. The people that make things happen. The development of District Energy was made possible by several key people, and one of those champions is Bill Buth.
In December 2022, the District Energy Board of Directors recognized Bill’s many contributions by naming him a Director Emeritus. Bill served on the original District Energy board of directors from 1978 until 1982. He then returned to serve a second term, representing small customer on the board from 2007 until 2012. Bill was an instrumental contributor to establishing District Energy’s heating and cooling services.
As the longest serving President of Greater Saint Paul BOMA, Bill was a vital link to the business community in the public private partnership that was fundamental in developing the energy system. He helped to educate business leaders about the advantages of hot water services. Bill was already integrated into the downtown business community. He understood the priorities of downtown business leaders and had earned their respect. Bill contributed significantly to this complex endeavor by sharing the important voice of the building owners throughout the energy system development process. He also invested his time to learn about the technical aspects of the innovative new system that was being proposed and how it would be different than the existing steam services.
President and CEO, Ken Smith, describes Bill’s work, “Bill contributed mightily. It was a major undertaking to try to develop a new community energy system that would be a model for the nation, and Bill was a vital connector between all of the parties at the table. Bill has clearly earned the honor of Emeritus at District Energy. We are forever grateful for his service to downtown Saint Paul and our company.”
Bill believes in the adage, “Lead, follow, or get out of my way.” He describes working on the development of the district energy system as a great opportunity to lead and expand his professional capabilities and relationships. He has great recollections of visiting other district energy systems, learning from technical experts, and ultimately watching the energy system provide service. He never passed up an opportunity to connect with team members working in the streets or down a manhole. He said, “Everyone involved was working together. As a group, we built a community heating system and then a community cooling system for Saint Paul.” Regarding becoming Director Emeritus, Bill noted, “Working on this project and serving on the Board of Directors was humbling for me. Now, I feel so fortunate that in perpetuity my name will be regarded alongside the great collaborators that I had the pleasure to work with and know.”
Thank you, Bill, for being our champion for Saint Paul.
Annual Report 2022
Rates & Unit Sales
|Demand rate ($/kW/mo)||$5.80||$5.63|
|Energy charge ($$/MWh)||$30.55||$21.83|
|Overall rate ($/MMBtu, 1700 Util hrs)||$20.95||$18.04|
|Energy sales (MWh)||368,323||330,313|
|Demand rate ($/ton/mo)||$30.85||$30.02|
|Energy charge ($/ton-hour)||0.097||0.081|
|Overall rate ($/ton-hour, 1200 Util hrs)||$0.406||$0.382|
|Energy sales (ton-hours)||38,318,975||36,400,165|
Revenues & Expenses
|Fuel and energy||$15,188,184||$10,839,984|
|Non-fuel operating expenses||$13,367,097||$12,634,830|
|Total operating expenses||$28,555,281||$23,474,814|
|Operating Income Before Depreciation||$10,576,998||$10,858,638|
Board of Directors
Kris Taylor, Chairperson
Vice-President of Community Relations, Ecolab
Assistant Commissioner, Minnesota Department of Agriculture
Large-sized customer representative
Vice President & Chief Financial Officer, Regions Hospital
Executive Director, Securian Financial
Medium-sized customer representative
Beverly Jones Heydinger
Retired Chair, Minnesota Public Utilities Commission
Attorney and former Commissioner, MN Department of Labor and Industry
President, Commercial Real Estate Services
Small-sized customer representative
President, Minnesota Pipe Trades Association
Ken Smith, Ex Officio
President & CEO, District Energy Saint Paul