Good day, everyone, and welcome to today's webinar, "Energy as a Service: A New Paradigm for Energy Solutions Procurement," hosted by the Industrial Internet Consortium as part of our Industry Day program of webinars. We are pleased to welcome our IIC members and guests from around the world for this informative webinar. Before we begin, I want to draw your attention to the Attachments tab on the dashboard. There you'll find a PDF of today's slides available for download. We've also included links that you can use to connect to our panelists on LinkedIn and Twitter. As well, there are links to other exclusive programs being offered to the public this week by the Industrial Internet Consortium. We hope that you'll join us at all of them. This webinar will be available on demand at the conclusion of the session, and a link will be emailed to you.
We will be dedicating time to your questions today, so please submit yours by typing into the Questions tab on your dashboard. Now it is my pleasure to introduce our panel leader for today's discussion, Leila Dillon, VP of Marketing and Communications at Ameresco. Leila, welcome.
Thank you so much, Bonnie. Thank you. Good morning, everybody. We're just delighted to be here today to talk about Energy as a Service, a big buzzword anyone in the energy infrastructure has been hearing so much lately, and really how we're seeing a new paradigm in energy solutions procurement. Before we jump into the slides, I want to take a minute to introduce our great guest today. We have Dr. Richard Bailey, who is the president of Northern New Mexico College, as well as Tim Farkas, who is the director of finance at Ameresco. Before we jump in, I'm actually going to toggle out and let each of you introduce yourselves. Rick, would you be kind enough to start with yourself?
Sure. Good morning, everyone. Thank you so much, Leila. And honored to be here. As Leila said, my name is Rick Bailey. I'm the president at Northern New Mexico College. I've been here for about four years. And obviously, I'm super excited to be a part of this discussion and to share our experiences and my personal experience as a chief executive in this endeavor. So honored to be here. Thanks very much.
Thanks so much, Rick. Terrific. Tim, how about you?
Good morning. Thank you, Leila. Yeah, I'm Tim. I'm the finance director. I've been with Ameresco for eight years and working directly getting financing for green energy projects for about 10 years. And before that, I was a public finance banker working here in Nevada to get money for all kinds of projects and kind of had a strong interest in green energy. And so here I am, here we are 10 years later. It's been a great time. So thank you.
Great. Terrific. Well, thanks so much. I'm excited for this session today. I'm going to jump back into the slides if we can here. Okay, so let's dive in. Energy as a Service. What do we mean by this? Really, we're seeing that so many large energy consumers out there. Today, we're going to be hearing from Northern New Mexico College, but it's colleges, it's universities, it's the municipalities, it's the federal government, manufacturers. They're really all tasked with trying to address their energy consumption needs with diminishing budgets, especially in this challenging time that we're having with COVID. So as such, we're. But tackle some of the financial barriers that often stand in the way of progress. So that's really what we're going to talk about today.
How are you able to address your energy efficiency and your energy upgrade needs, and yet also recognize that budgets are hard to come by these days and capital dollars are not necessarily there? So we're really looking forward to diving into this topic with you all today. Before I dive into that, I do want to just take a minute to talk about Ameresco and give you a little bit of background on why we are here today. Ameresco is a leading energy services company. We have a comprehensive portfolio of energy efficiency and renewable energy solutions. We really work with colleges and universities, as we'll see today, but also with the federal and municipal governments, with the C&I markets, with K-12, public housing, healthcare, airports, you name it. And we really try to address both efficiency and energy generation.
So typically, when we work with our customers, we start by trying to help determine how to reduce the demand with advanced energy technologies that we have. And then oftentimes, we'll look at the generation side and what do those customers need. We have distributed energy generation capabilities, solar, storage, microgrids, and more. So we really try to handle all sides of the energy equation, starting by analytics, which we'll hear about, and really understanding what the needs are, and then all the way through the generation capabilities. We are a public company. We have over 70 offices across the U.S., the U.K., and Canada. And I'm very pleased to say that in 2019 alone, our customer projects and our own assets delivered a carbon offset that's equivalent to over 11 million metric tons of carbon dioxide. That's something that's super important to us.
You'll hear more about that as we go. Let's dive in. Energy as a Service. That's why we're all here today. Now that we've introduced everyone and hopefully you have a snapshot of Ameresco, who we are, and what we do, we really want to transition now to what we like to call a new paradigm in energy procurement, and that's Energy as a Service. So Tim, can I turn it over to you now? Would you be kind enough to really talk through some of the characteristics of Energy as a Service?
Absolutely. Thank you, Leila, again. This term, Energy as a Service, can mean a lot of different things to different folks. We're going to kind of drill down on what it means in our market and then give you some perspective on the entire spectrum of what Energy as a Service might entail. First of all, there are a few here we have eight sort of goals. These aren't necessarily equal. They are dependent upon the goals of the customer and what they want to get out of Energy as a Service. There is a factor of this that is customizable. It's not the same solution for everyone. The main driver, though, is, as Leila already mentioned, that there's no capital required.
The project will generate some form of energy savings, sometimes operational savings, and sometimes capital savings, and that we can help develop a project that is budget neutral or maybe budget neutral, but it's definitely not financing, and it might be off balance sheet depending upon how the payments are structured and how we structure the agreement. So those are really the drivers. No capital upfront. It can be off balance sheet. Your auditor has a say in that, so we don't just make a blanket statement about that. Then we can tailor the solution to what we find, what your goals are, what the customer's goals are, and what we find as far as energy improvements that are necessary. So the solution is as comprehensive as our customer wants it to be. You'll see a lot of energy service offerings around lighting.
That's a pretty straightforward one, right? Energy savings through lighting. It's a factor of runtime and wattage saved in usually a new LED light. But this can go all the way into much more complicated solutions such as central plants, microgrids, of course, solar, and different energy supply solutions. So this isn't just lighting for us. For Ameresco, because we have 20 years of experience developing comprehensive energy projects, we're comfortable delivering a broad array of solutions. And then on the accounting side, it's interesting to think about if a customer really wants something off balance sheet and then you kind of get into asking a few questions, sometimes they realize they just really want it to be off credit. They don't want it to look like they don't want it to be financing a project.
Sometimes when you really achieve off balance sheet treatment, you might have done things to the payment structure or the structure of the agreement that are more costly than you imagined, truly variable payments and things like that. And so it's a we have to understand the goals on both of these spectrums and figure out exactly what the customer wants. And we're capable of meeting the needs on both of them. And then this is, again, as I described at the beginning, this is kind of where Energy as a Service fits into what you might hear about. Energy as a Service can mean really different things to different companies, even in our industry.
It can be as simple as a company who really just wants to focus on lighting as a service and then all the way go all the way to a complete outsource privatization type of structure or a concession agreement or the things you see there. And then within that, Energy as a Service also fits into what's called P3, when there's a public entity, as there is in the example we're going to talk about today with Northern New Mexico College. This is absolutely a P3 solution, public-private partnership, right? We are going to be taking some risk, taking some of the responsibility away from our customer to help them meet their needs in a way that they appreciate, right? They are much more interested in educating young adults than they are in being experts in all the things we're expert in.
What we see right now in the market is really very encouraging. There's this Guidehouse Insights sort of data point about the market growing extremely large in just a few years. We are seeing that in the market. We are seeing a strong interest for this type of solution. The addition of this terrible pandemic that we're in is having a deleterious effect on tax revenues all over the place. So for public entities, the idea of using precious capital or going out to the markets for typical financing is much less attractive, even though interest rates are as low as they are. The idea of going and getting a debt rating might be a bad idea. The idea of tying up capital when we don't know how this is going to end might be a bad idea.
So if they can get these capital improvements done in a way that really is truly not financing, then that's great. So how do we approach this process? It's really a very interesting development that Ameresco has applied to this that combines energy analytics and asset management. We have an asset management tool, a software tool, that can combine the energy output and utilization and monitoring and submetering in such a way that they become two different tools that help customers in two distinctly different ways. But we are able to capture the information in very similar ways and then have that data managed for our customers so that on an ongoing basis, they can understand where every energy and utility dollar is spent and the condition of their assets that we're tracking that either use energy and water or not.
They can be just regular assets in the portfolio of assets they. So to have those two things together, we're hearing from the market is a very valuable solution. Of course, when you go around this wheel, the energy efficiency side we are experts in. The Department of Energy determined from all the customers who do work for the federal government that we provide the most value per dollar. On the infrastructure side, we can absolutely get more into infrastructure than just energy and water improvements. And on the distributed energy side, we do a lot of solar, distributed solar. We have built significant microgrids at military bases, for instance.
And all of that leads to our ability to own and operate those things, leads to a real risk transfer from our customer who may not want to operate some of those more complex things and take over O&M on any of those types of improvements that they may not have expertise in. So, on benefits of Energy as a Service, there is no, as we talked about, the key points again, no capital outlay. The financing is handled on our side if there is financing needed. We provide these services that are outlined in an agreement and developed as a partnership. The risk transfer is customizable. It can be what you need it to be. We have an experienced team of people who are, of the 1,000 people we employ, 1,100, I believe, about 70% are engineers.
Everything we do meets sustainability goals or moves our customers towards their sustainability goals. It's just a sort of a factor of everything we do. All we do are green energy projects. Of course, at the same time, these systems are being modernized. Technology and data management is being implemented. And with that, we help our customers manage the risk of operating the equipment and making sure they understand the condition of the equipment in case there is an event that could create a shutdown or something. We increase resiliency as well.
Great. Thanks so much, Tim. That's super helpful. Just a couple of questions that are coming in, and I'm so grateful. Please use that question panel to pose your questions, and we're going to be sure to try to get to them throughout this presentation. But Tim, you talked a little bit about sort of the spectrum of Energy as a Service. And is it true that it can be as simple as something like lighting as a service where we would come in and provide the energy efficiency, energy-efficient lights as well as the replacements and things like that over a period of time to something really as complex as sort of a master energy services agreement where we would come in and build a power plant and do the solar and do the microgrid or a battery storage or what have you?
So, can it really span the spectrum of Energy as a Service really be all things, and is it dependent really on what the customer wants and what level of risk they want to transfer?
Yeah. Thank you, Leila. That's as the finance guy, I get to walk into a room and address these exact questions, and I don't have to check back with the home office or anything. We have the ability to contract however the customer sees the best value in that type of solution. And so when you think about their goals and our understanding of those solutions and the different incentives that come into play, certain incentives only go to taxpaying entities. Probably a lot of listeners today are familiar with the tax credits that come with solar. There are all sorts of other grants and things that pop up from time to time, state grants, utility rebates. And so we have to look at that. Who is the best owner for this? Where is the best value?
Where does this project live and live on in a place that gives the most benefit and meets the goals of our customer? So it's a combination of those two things. And it really can be as simple as a lighting project. We do those all the time. We do a lot of street lighting projects, large street lighting projects. And then we absolutely do build and own and operate large, complex solutions such as the 91st Avenue Treatment Plant, right? It's a sewage plant in the Phoenix area where the water goes to cool a nuclear plant. So they don't tolerate any shutdowns, or there's no potential for us to ask for some concession on when we operate or when we kind of get in there to do what we do.
We built a plant that takes out the methane of the sewage and turns it into pipeline quality gas and sells that gas into a market where oil companies need those green energy credits, those green gas credits. And so there, you look at that and you say, "Well, why don't they use the gas on-site? It's not nearly as valuable to the city and to the entities that own that plant than it is to those oil companies who need those green energy credits." So that's a great example of where we're actually willing to write a check and make that happen.
Great. Great. Okay. Terrific. A couple more questions, but I want to get to the meat of this program, and then hopefully, we'll have time to get back to some of those questions. So we've heard a little bit about sort of our approach and our structure to Energy as a Service. But now, let's hear about Energy as a Service in practice. And so I'm very excited at this point to ask Rick to jump in. Rick, I'm going to put some slides back up if that's okay with you. Again, just for everyone's reminder, Rick Bailey is the president of Northern New Mexico College. And he's going to talk to us a little bit about their procurement process with Energy as a Service.
Rick, before we do that, would you be kind enough just to give us a snapshot of Northern New Mexico College for any of us that haven't been lucky enough to be there as of yet?
Absolutely. Thanks, Leila. And again, just an honor to be with all of you. It's a real pleasure to be at Northern New Mexico College. As I said, I've been the president now for four years. And before that, I was 24 years in the U.S. Air Force. So this is my first job after the military, and it's been really, really wonderful and challenging at the same time. The college is a beautiful place. It got its start in 1909, three years before New Mexico even became a state. We have two campuses, one in Española, which is about 30 minutes north of Santa Fe. And then the original campus is in a village called El Rito, which is about an hour north of Santa Fe. Our student body almost perfectly reflects the landscape here, the personnel landscape. Our student body is 74% Hispanic, 12%-13% Native American.
Most are the first people in their family to go to college. 70% are Pell-eligible, meaning Title IV funding from the Department of Education, so low-income students. And so for me, in my opinion, what the college does, the real magic of the college, is that it's not just educational. It's transformative because what our college does is really help not only students but their families and ultimately entire communities lift themselves out of poverty. And that's really, really exciting. We're a four-year school, so we offer certificates, associates, and bachelor's degrees, fully accredited. Our programs, they're fantastic. And I hope everyone is sitting down for this next part. We are committed to providing really low-cost, high-quality education. And this is the sitting-down part. For a full-time student at Northern New Mexico College, tuition, fees, everything for a full-time student for an entire year, it's less than $5,000.
That's why we do what we do. We're committed to that. We're the only college in New Mexico that for the last 3 years, we have not raised tuition, not a penny. And it's because we're committed to doing what we do, and we recognize who we serve. I think we're being rewarded for that. We're the only educational institution in New Mexico, actually in the region, that had an increase in enrollment over the last year, even in the midst of the largest economic and social and health challenge that we faced in our 111-year existence. And we did that not by pulling people away from other schools. We compete, I always say publicly. We don't compete with other colleges for students. We compete with the decision about whether or not to go to college. And so we're definitely on the right track.
Wow. That is so impressive. You have me with the $5,000 tuition fee. To be honest, that is.
Yeah. If any of you have students who are interested, please reach out to me after. I'm happy to recruit.
That is just great. Not to mention the increase in enrollment, which in these times is really quite phenomenal. So congratulations. That is just terrific. So Rick, now that we've gotten a really good idea of Northern New Mexico College and all of the great things that you're doing there, would you be kind enough to share with us some of the challenges that you've been facing in terms of your energy procurement and your energy issues and give us a little bit more color around that?
Sure. Sure. So Northern is a public institution. I mean, we're partly funded by the state of New Mexico. And so because of that, our college, like every other public college in the state, we are tied to the ups and downs of our state economy. Now, New Mexico and I'm not going to make a political statement here, but the economy is very tied to one specific industry, the oil and gas industry. And while we are working as a state to diversify long-term, in the interim, we are tied to the vagaries of that market. And when that market has ups and downs, the college is on that same budget roller coaster, which makes things very, very difficult for long-term planning.
So when I got to the college in 2016, I really wanted to start looking at a different model for how we run our fiscal health and how we stop looking at what was right in front of us and start planning for 10, 20, 30, 50-year projections for the college. That's the way we make a difference, I think, with an institution like this. So I went to there's an office within the Department of Environment at the state called the Energy, Minerals, and Natural Resources Department. And I went to them saying, "Hey, I want to think about building solar and doing some other things and really transforming our infrastructure." And they notified me that there is a program where energy service companies will do an energy audit of your institution.
And if they can discover potential savings through some green energy transformations, well, then the future savings from that transformation actually goes to pay for the actual infrastructure improvements. To me, it's genius. And I think any public institution that doesn't take advantage of that is truly missing out because you can put your organization on a long-term, healthy fiscal trajectory. So there are energy service companies that are actually already pre-approved by the state. That is how I got connected to Ameresco. Ameresco won the bid for our institution. And so for both campuses, we've been working with Ameresco on how to do that. So to me, what we discovered, this is a long answer, Leila. It's your question. I apologize.
No, it's great.
What we discovered, though, at Northern and I'm guessing that a lot of the participants in this meeting, you probably will agree with this, when times are tough with budgets, infrastructure seems to be the thing that gets put on hold, right? "You know what? We'll just put another Band-Aid on it and some Scotch tape and bubblegum, and we'll figure it out next year or five years from now." Well, at some point, that check comes due. And for an institution like ours, I recognized early on that the infrastructure challenges that we had had been that can have been kicked down the road for just too long, and we couldn't ignore that anymore. So this comes to the question that one of the participants asked Tim about whether we can do lighting and some other things.
Lighting, for sure, worked for Northern, but we also had huge aging HVAC facilities and other things that really needed to be replaced. So at that point, the simple savings, future savings, wasn't enough to justify kind of the biggest or to pay for the big changes that we needed to make. And that's why we had to get creative. And I give a lot of credit to Tim and to Ameresco for exploring how else we could make this work.
Great. That's so great. And some good questions that are coming in here. I'd like to just pause for a second and come back so that we could chat. You talked about future savings actually being able to pay for the upgrades. And that's definitely something that we do a lot of. We see that more and more. And what's shocking is that so many colleges, universities, and municipalities. They don't know that those programs exist. So there's no capital outlay that the long-term plan basically enables that to fund that new infrastructure that's needed. And everybody benefits, really. It's kind of a win-win. But you talked a little bit about this sort of phased approach and your long-term vision to revitalize the sort of energy footprint on the campus.
If my understanding is correct, it's starting with something simple like lighting across all of your buildings, indoor and outdoor, and upgrading the HVAC system. We're hearing so much about air quality right now and how important it is to have that good air quality in place. But then the longer-term lens is that you wanted to bring in some renewables and things like that, which is very much what we see. It's just sort of where do we begin? How do we become as efficient as possible? And then how can we add renewables into the portfolio? Then you add to it, if I'm correct, and I'll jump back into the slides, you have a whole nother campus to consider, if I can jump back in. Is that correct?
Yeah. And so let me take a look into this. So I'm an educator. That's what I do. And Tim said something in the last section that was really important. I'm not an energy expert. I'm just not. Just like I'm not a cafeteria expert. I'm not an apartment manager. So dormitories and food service and energy projects, if the college can partner with entities who do this for a living and who are super passionate about it, and I can articulate the vision, "Hey, this is what I'd like to do," then it allows me the bandwidth to trust those partners to do that work while I can focus on what we need to do for students. So let me draw the other analogy here.
When I first got to Northern in 2016, I looked at our annual budget, and we spend roughly about $800,000 a year in utilities, $800,000, one for a campus up here in El Rito that is barely used. So the writing on the wall was, "Let's not do this just for the environment. I mean, clearly, we want to do that. Second, let's leverage the assets that we have." If there are two things well, I'm going to say three because there's amazing food too. If there's two things that we have here in New Mexico in abundance, it's land and sun. We have 335 days of sunshine here. So why are we not leveraging what we can do and what we have in a way that frees up capital for us to do the things that really matter for us?
My long-term vision is if I can take that $800,000 and move that to $400,000, right, and eventually to zero, which would be fantastic. Well, then that's every dollar now that I have to put into student success and food pantry and student housing and scholarships and all these other things that are going to help students get to the finish line, which is really what I'm here to do.
That's great. That's great. And you raise a good point, Tim. You might want to weigh in on this. I think that oftentimes, we see, whether it be college campuses or municipalities, what have you, there are things that they focus on every day in terms of doing business, but there are, as you said, things that they don't necessarily want to become experts on. Maybe they don't want to know everything about a power plant and how to make it run perfectly day after day. So Tim, do you see that oftentimes, the more complex these projects get, the more often we're sort of operating and maintaining them and really trying to help get the most out of them that we can for the customers?
Absolutely, Leila. We see that all the time. But when a customer also has an expertise, people who are in the organization currently who they like and they want to keep, we're not displacing anybody, right? We don't come in and make things so great that the maintenance folks get to go somewhere else. We're letting them do their day jobs, right? All this maintenance stuff is not their primary function. And so even when we find a place that's well-staffed with maintenance people, by coming and doing what we do, we're allowing them to focus on the things they were hired to do, not going around making sure everything is not failing, right? That turns into some people's jobs, keep this not failing. And so that is an incredible risk transfer that we come in just by bringing in new stuff.
And if they have the expertise to do on them, that's great. They can. If they want us to do it, we can. We don't dictate those terms. The other quick point I would like to make is that everything we do in our industry, we're doing a sort of cost-benefit analysis of, right, through these utility savings and different savings. Going green does not cost you money, and it does create jobs. And so there's a popular misnomer out there that to go green, you're going to somehow be a burden on something, and you're not. All of this stuff that we do has to make financial sense as well, right? And it has to have a source of repayment, and it has to be in many cases, it has to pay for itself through utility savings. And so.
Yeah. And, oh, I'm sorry, Tim.
No, go ahead, Rick.
The only thing I'd add to that is that for poor communities like ours, the fiscal reality is actually the driver. In many cases, that's the driver, right? We clearly, here in New Mexico, we embrace green technology. We're excited about doing our part for the environment. But in poor communities, a lot of times, the decision calculus for a lot of these projects is actually driven by fiscal realities. And at the point at which photovoltaics and everything else started to come, even in the ballpark of reaching some parity with traditional fossil fuel energies, well, then that becomes now a new reason, an extra reason to move in this direction.
Great. Terrific. Excellent. Okay. Thanks so much. I'm going to pop back into the slides. So you talked a little bit about the El Rito campus. Do you want to touch on that anymore, or shall we keep going there, Rick?
So just 15 seconds. The only thing I'd add about this is that in addition to the work we're doing with Ameresco, I also reached out to our local co-op up here in Taos, and we partnered on the construction of a 1.5-MW solar array that just went operational December 20th. The nice thing about that is not only is that going to add to the project that we're doing here with Ameresco and the EaaS, and not only is the college now going to see reduced electricity rates for the next 30 years and steady, but everyone in the community up here who is tied into the co-op is also going to see their electricity rates go down. So one, I end up being added to a lot more Christmas card lists. Fantastic.
But it really shows the college as a community partner in ways that can really make long-term benefits to the community.
Terrific. That's great. And now for all our listeners out there, probably the meat of it, right? Rick, would you be kind enough to kind of walk us through you have this big goal to revitalize the campus. You have a phased approach to doing it. But now let's get down to sort of nuts and bolts, right? How did you come to developing this Energy as a Service project? And can you give some recommendations, best practices, etc., on sort of how you went about this procurement methodology and how you brought it to life within the campus?
Sure, Leila. Yeah. So I do want to I do want to say at the outset that I want to make it very clear that I am not a visionary that kind of came up with this great solution. I think in many ways, I stumbled into this success, and so I have to stay humble about that and that I have the right partner in this and that that worked out. Ours was really driven by fiscal reality. And so in terms of this challenge of, "Okay, you have two campuses in a very, very poor community, one campus that hasn't been used in over a decade. Here are the two big wicked challenges that you have. One is to kind of revitalize this campus.
Two is to transform the infrastructure in ways so that you're not kicking the can down the road again." Well, then how do we do that? The dual-campus energy audit was the first step. Really having the engineers crawl into our buildings and understand really what the needs were was the first step. At that point, then, we looked at what our assets were, right? We had the partnership for the big solar array here. We had other things that were on the horizon. We're doing a partnership for a biochar energy project. There are all kinds of other things that are contributing. But in terms of a systems-thinking approach to this, what are the ways that we can leverage what we have?
That's really where, as I had said before, the savings plan for the energy audit would cover some of it, but it really wouldn't go the rest of the way. That's where we had to get creative in terms of how the funding works. Of course, it helped having Tim. Now, I will say this. When we started the dual-campus energy project, it was really the engineers at Ameresco that I was focused on because they were the ones telling me, "Okay, we can do this with the lights, and this with the water, and this with the heating." But once we knew that this was going to be a much bigger project than savings would account for, then Tim became my conduit. I mean, really, Tim and I then started having almost daily meetings about this. So that's really how this came about.
I will tell you the long-term vision is for both of these campuses to be energy net zero, not only for the educational value and for setting that role model for the rest of our community, but then it frees up, like I said, frees up very, very precious resources so that I can focus on doing what we're here to do.
Thanks, Rick.
Okay.
Leila?
Oh, Leila, I think we're better on mute.
Oops.
Okay. We can hear you now. We can hear you, Leila.
Oh, I don't know what happened. I must have paused for a moment. If we just jump back in here to the slides, just a couple of quick comments, and then I want to just ask a couple more questions that have come in. I'm delighted to see them here. So in wrapping up, Energy as a Service, if we're going to go ahead and sort of summarize it, I guess it's really all about when you need to upgrade your energy infrastructure, whether it be something as simple as lighting and HVAC to something much more complex than that, but you don't necessarily have upfront capital that you want to put towards that project, and you potentially want some ongoing support, whether that be in operation and maintenance or what have you over a long period of time.
And yet, sort of the final thing is you don't necessarily want to add this to your balance sheet. This is really a good option here. And I think we're seeing this more and more, not only in colleges and universities, we're so lucky to have you here with us, Rick, but also, as I said, in municipal governments, in the C&I markets, K-12 schools, you name it. So it's really become quite an exciting topic and I think a business model that's working. And I think it's especially ripe given the challenge of current economics with the pandemic. So I think that's terrific. So real fast, I'm going to switch back over here. A couple of good questions came in here. So let me end the slides, and let me point this back over to you, Rick.
Are there any sort of state requirements, some statutory requirements that come into play here? Is this something that you had to think about as you went through this process? And how much did that weigh in, and who are the right stakeholders to get involved? I assume that's a big piece of this.
It's a fantastic question. Remember I told you how, "Hey, I'm not an expert on cafeteria, and I'm not an expert on apartment buildings, and I'm not an expert on energy projects. I'm also not a lawyer." Sadly, in the chief executive world, a lot of what I do in running a public state institution is really making sure that we're within bounds in terms of statutory requirements by the state and the federal government. Yes, to answer the question, there were a lot of things that we had to consider, actually a lot of conversations and sleepless nights that Tim and I had trying to rack our brains, making sure that this fit within the state requirements. Yeah, there's a lot of things that we have to think about. I'll give you an example, and it's tangentially related to your question.
Taxpayers pay a portion of our budget. State taxpayers pay a portion of our budget. And so we have an anti-donation clause in the state constitution, meaning that if a nonprofit wanted to come and have a meeting, let's say post-COVID. If a nonprofit wanted to have a meeting here, and we offer the space, we can do that as long as I can make the argument that the college is receiving some benefit, right, if our students are receiving some benefit. Otherwise, it can be argued that I'm giving preferential treatment using taxpayer money for something that doesn't. So that's nothing I would have ever realized before this, right? It's just, "Hey, we have the space. If you want to use it, great." But there are very specific state requirements. So long answer to the question, but absolutely.
That's why we have to make sure that we're dotting the i's and crossing the t's.
Great. That's great. We're right.
That's good enough.
Oh, sorry. Go ahead, Tim.
No, I appreciate that. And the statute in New Mexico for what we do is quite rigorous, probably the most rigorous in the Southwest. But there was a bullet point on one of the previous slides that Dr. Bailey kind of didn't quite drill down on, and I think they deserve a ton of credit. Dr. Bailey, creating that taxing district and having taxpayers vote in this day and age when getting a bond pass is so difficult, can you talk a little bit about that process, please?
No, yeah. So thank you, Tim. So there were two big. I said two big wicked problems that I was asked to tackle when I came here. One was we had this institution, this campus that hadn't been used in 10 years. The other is that over the last decade, decade and a half, we had a lot of key career technical education programs that evaporated over time. And our community, especially in this region, that's where a lot of really high-paying jobs are. And so the community really wanted us to find a way to bring those back to life. So again, just like Tim and I did with the energy, we had to get creative and start thinking about how we could stay within the state boundaries but do something creative. And so we came up with the idea of creating a co-located branch community college.
It's the first of its kind in the history of New Mexico. We drafted a bill that the State Senate took up in 2019. Ultimately, they approved that unanimously in both houses. Democrats and Republicans approved it, which is a feat in itself here in New Mexico. Then we partnered with five local school districts to create the community college district, and that led to the ballot initiative that Tim talked about this past November. With over 62% of the vote, even in a really poor community, our citizens said, "Yes, this is worth us investing in." So this semester, we started with a plumbers and pipe fitters program and an electrician program that are going to be tied to jobs here in our community that will help raise the standard of living for everybody. So we're really excited about it.
That's great. That's great. In fact, the last question that we have here, and then we're probably out of time, is this big vision, this idea of really transforming the energy portfolio that you have, is this something you've got the students involved in or plan to have them involved in for the long run? I love that question.
Yes. Because of how my mind works, everything has to be tied into what it means for students. So when we did the solar array, for example, with Kit Carson, the very first question I asked them was, "Hey, can we put this on our El Rito campus?" The second question is, "Hey, can our students help build it?" So it's always figuring out. In fact, to the question, the electrician program that we're building and the plumbers program we're building, we're excited that some of the work that Ameresco is going to do in terms of this transformation, that's going to be a living laboratory for the students who are actually in these trade programs.
It's not set yet, but in my perfect world, we can actually the students would actually be participants or at least observers in the work that happens so that they're getting college credit for the projects that are happening.
So great. That's so great. We love that. This is something we do often, right, Tim? We get very involved in the curriculum. We actually have a solar curriculum that we have developed because we really like that engagement. It's so important that it really comes full circle like that.
Yeah. And for us to be in our industry, hiring subcontractors all the time, and seeing what a desperate need there is for trained professional people who are doing these trades, we see it in the markets for those types of services all the time, especially in New Mexico. But even some of our customers, we're wrapping up a project right now for the City of Santa Fe, and they have job postings for electricians and pipe fitters, and they're not getting qualified respondents.
Oh, and I know we're out of time. Let me say two quick things. One, if contractors have to hire the folks that Tim just talked about, if contractors have to hire them from out of state, then I have failed my job as a college president because we should be growing that talent. The second thing is, if we can grow that talent here, then contractors aren't having to pay per diem rates, housing, all that stuff for the folks they bring in, and that drives the cost down for construction projects around the state. So everybody wins if colleges can start growing that talent organically.
You can see how exciting it is for us to have a partner like Northern New Mexico College. It really is, on so many levels, it's just such a great partnership. We're really happy to be here. Thanks a lot.
Partner of the week, for sure.
Now, we're so grateful. Rick, thank you very much for your time. It was fun to hear more about Northern New Mexico College. So many exciting things going on there, and fun to see this next paradigm of energy as a service and really how it plays out. So thanks to everyone. We appreciate the questions and your participation, and we very much hope to do this again sometime. So thanks very much.
Thanks, everybody.
Thank you.