Op-Ed by: Kay Carroll, School Board Candidate and former Chairman of the Johnston County Board of Education
Education Energy was the name of a Texas based “energy management” company started in the early 1990’s that changed its name to Cenergistic in 2012.
The company tried for years to get a contract with the Johnston County Schools, first in the mid 90’s, then again around 2003, and then again around 2007. Each time, the district administrators turned them away. The business pitch sounded implausible.
Having served on the Johnston County Board of Education from 1992 to 2008, I was witness to many improvements in the schools, not the least of which was our new construction. We moved out of turn-of-the-century, three-story buildings and into modern educational facilities. Probably most impressive was the district’s determination to equip the new buildings with state-of-the-art energy saving systems that grew better and better as time went on.
When I left the board in December 2008, the 20 schools we had built that last decade and most of the ones we renovated, included the use of natural gas wherever possible and centralized computer control of all heat (boilers) and air conditioning (chillers). An energy calendar was available on the website so that schools could request heat/cooling for after-school events, because without a special request, at the end of the school day, the computers would automatically adjust temperatures to save energy at night.
In addition, the buildings had an array of other energy saving devices including ice storage, humidistats, sensors on outside building lights, etc. Moreover, our utility invoices were constantly monitored for anomalies that might indicate a water leak or excessive power or gas usage. Again, our systems were state-of-the-art and admired and visited by other maintenance groups in counties around us.
I am told that in 2012, Dr. Ed Croom, actually signed a contract with the Energy Education/Cenergistic, but it was pulled because allegedly, he was told by one of the district lawyers, that in the attorney’s opinion, the contract was not valid.
In 2015, there was, obviously, another attempt by Dr. Croom to get this group into the county. I am informed that the first thing he did was to direct Patrick (Jake) Jacobs, who was in charge of Facilities, to generate an energy savings report. Jacobs allegedly turned in a report that claimed about $1 million had been saved over some amount of time with the district’s own systems, but stated that level of savings was probably a “plateau.”
So armed with those representations (as unscientific as they may have been), Dr. Croom proceeded to move the project forward. (Keep in mind, all this time Larry Strickland was still Board Chair.) Former superintendent of Wilson County Schools, Dr. Larry Price, had been hired as a regional President of Cenergistic, to carry on the local sales work. With Dr. Croom’s knowledge and permission, Dr. Price flew Mr.Jacobs and another Facilities director in a private plane to Virginia to take a look at one of the operations.
At the end of that year, on December 8, 2015, Dr. Croom (on behalf of the school system) signed a contract with Cenergistic. Dr. Croom is the only one who signed on behalf of the district.
To date, we have received a copy of the contract, but we have not been given Board of Education meeting minutes where the Board approved the contract, as required by law. Also we have not been given any proof that other companies were also allowed to give proposals, as required by law.
The Johnston County School District was not some poor, isolated system characterized by a lack of technology or energy savings knowledge. Rather we had knowledgeable employees who could have fully evaluated Cenergistic’s proposal. Unfortunately the district did not even engage independent qualified, certified, licensed professionals to evaluate Cenergistic’s proposal.
Over the years, many stories have appeared on the internet from school districts that believe they have been scammed by Energy Education/Cenergistic. For example, in 2009, The Massachusetts Inspector General wrote an 18 page document warning school districts all over his state to pay attention to the law and to what they were agreeing to in these “energy saving” contracts. The Massachusetts Inspector General warned: “Do not enter into a contract unless you: 1) understand how you will be charged for services; 2) will be able to verify these charges: 3) will be able to verify any vendor savings estimates; and 4) understand all contract related costs.”
The contract Dr. Croom signed with Cenergistic required Johnston County Schools to:
√ Sign a 5 year contract which expires June 2021.
- It is very rigid with an OUTRAGEOUS cancellation fee.
- We are currently in the 4th year which would mean to cancel, we would have to pay an amount equal to the invoices for the past year – about $500,000.
- The District is STILL UNDER CONTRACT and paying out the nose.
√ Choose three people to be the “energy managers” – no knowledge of electricity, heating or air conditioning systems, KWHs, or energy management was required – just to be able to go to Texas and participate in a seminar and do what they were told to do. Three local people were chosen.
- The District had to agree to give them office space, an office phone, internet access, email address, on-campus parking, building keys, and alarm codes.
- They also had to be guaranteed a police escort (if requested) if they wanted to enter a building after hours.
- These people were to be paid by Cenergistic, but if the contract was cancelled in the first year, the District would have to reimburse Cenergistic $700 a day per person from start date to cancellation date.
- These people were also required to have access to OUR energy management system, and the authority to make changes to temperature settings, run times for HVAC, water, and heating and lighting systems and also to change any system that was not controlled by the District’s management system.
√ Choose a Program Liaison – one of the District’s senior-level business officials to serve as the primary point of contact. Patrick (Jake) Jacobs, the Assistant Superintendent of Facility Services was chosen. He too, was flown to Texas for indoctrination at least three times while he was the liaison.
√ Lease their software for $13,800 a year for the first 3 years and $5,382 for every year afterward. This is where all the magic happens. First the baseline year is established, but Cenergistic says they have the right to adjust the baseline even years later by “Adjustment Variables” like outside temperature, floor space, occupancy type, number of days in the billing period, energy rates, and estimated energy loads added or reduced. Everything seems to be a moving target in Cenergistic’s favor.
√ Pay Cenergistic’s monthly invoice which will be equal to 50% of what they call the Performance Fee or savings. This part of the contract is what districts eventually consider the main problem. There is generally no proof nor a reasonable explanation as to what they have saved. In fact, their invoices show “Cost Avoidance” which means that Cenergistic claims that if they had not taken certain actions, the District would have had to pay out more utility money. So since Cenergistic “saved” it, they are demanding half of the “savings.”
Based on information from current and former school system employees as well as publicly available data that we have received, it appears that Johnston County School System has paid upwards of $2,000,000 to Cenergistic between July 2016 and December 2019. And to date, we are still paying.
I have been told that many components of our cutting edge energy management system have been ignored, neglected and in some cases turned off, school buildings have been damaged, and occupants have been inconvenienced and subjected unnecessarily to unsafe conditions.
Trying to educate people to turn off classroom lights every time they leave the room is one thing, but pulling the disconnects on big equipment like chillers and leaving certain sections of our buildings without climate control in the summer is insane.
Mold is created with heat and water and stagnant air. So if we don’t have some cooling with air moving and the humidity gets too high, we will have mold in a heartbeat. We have had several problems that caused the district to have to call in their environmental consultant and orchestrate a “clean up” of mold. Outside cleaning services have been hired to clean carpets and other surfaces.
In addition, I am told that in one instance, when the Cenergistic people decided to turn the chillers back on, they had no idea what they were doing, and the district had to replace over $100,000 worth of compressors that crashed in one week because of the surge.
The list of problems and the stress that it has caused our maintenance workers and school people is really too long to list here, but suffice it to say, the decision to hire this company has not been in the public’s financial interest.
In February of 2016, only two months after Dr. Croom signed the contract (in December of 2015), HE LEFT and became (and as far as we know still is) a Vice President for Cenergistic. Thereafter, Patrick (Jake) Jacobs, left the district in 2017 and ALSO became, (and as far as we know still is), a Vice President of Cenergistic.
I urge the citizens of Johnston County to conduct their own independent investigation so that together we may develop all relevant facts. Only knowledgeable citizens will have the tools necessary to make an informed judgment as to what is best for the Johnston County Schools.
The NEXT article will explore the demise in the last ten years of, what was once, a District dedicated to educational excellence, student success and the ability to prove it on paper. The reason may also be tied to how the money has been used. We will see. Stay tuned.