GENERAL ASSEMBLY OF NORTH CAROLINA
1993 SESSION

CHAPTER 334
HOUSE BILL 101

AN ACT TO EXPAND THE CURRENT ENERGY POLICY FOR STATE GOVERNMENT TO APPLY TO THE CONSTRUCTION, OPERATION, AND RENOVATION OF STATE FACILITIES AND TO THE PURCHASE, OPERATION, AND MAINTENANCE OF EQUIPMENT FOR SUCH FACILITIES.

The General Assembly of North Carolina enacts:

Section 1.  The title of Article 3B of Chapter 143 of the General Statutes reads as rewritten:
"Energy Policy for State 
Government."
Sec. 2.  G.S. 143-64.10 reads as rewritten:
"§ 143-64.10.  Findings; policy.
(a)	The General Assembly hereby finds:
(1)	That the State should take a leadership role in aggressively undertaking energy conservation in North Carolina;
(2)	That State facilities have a significant impact on the State's consumption of energy;
(3)	That energy conservation practices adopted for the design, construction, operation, maintenance, and renovation of these facilities and for the purchase, operation, and maintenance of equipment for these facilities will have a beneficial effect on the State's overall supply of energy;
(4)	That the cost of the energy consumed by these facilities and the equipment for these facilities over the life of the facilities must be considered, in addition to the initial cost;
(5)	That the cost of energy is significant and facility designs must take into consideration the total life-cycle cost, including the initial construction cost, and the cost, over the economic life of the facility, of the energy consumed, and of operation and maintenance of the facility as it affects energy consumption; and
(6)	That State government should undertake a program to reduce energy use in State facilities and equipment in those facilities in order to provide its citizens with an example of energy-use efficiency.
(b)	It is the policy of the State of North Carolina to ensure that energy conservation practices are employed in the design, construction, operation, maintenance, and renovation of State facilities and in the purchase, operation, and maintenance of equipment for State facilities."
Sec. 3.  G.S. 143-64.11 reads as rewritten:
"§ 143-64.11.  Definitions.
For purposes of this Article:
(1)	'Economic life' means the projected or anticipated useful life of a facility.
(2)	'Energy-consumption analysis' means the evaluation of all energy-consuming systems and components by demand and type of energy, including the internal energy load imposed on a facility by its occupants, equipment and components, and the external energy load imposed on the facility by climatic conditions.
(2a)	'Energy Division' means the Energy Division of the Department of Commerce.
(2b)	'Energy-consuming system' includes but is not limited to the following equipment or measures:
a.	Equipment used to heat, cool, or ventilate the facility;
b.	Equipment used to heat water in the facility;
c.	Lighting systems;
d.	On-site equipment used to generate electricity for the facility;
e.	On-site equipment that uses the sun, wind, oil, natural gas, liquid propane gas, coal, or electricity as a power source; and
f.	Energy conservation measures in the facility design and construction that decrease the energy requirements of the facility.
(3)	'Facility' means a building or a group of buildings served by a central energy distribution system or components of a central energy distribution system.
(4)	'Initial cost' means the required cost necessary to construct or renovate a facility.
(5)	'Life-cycle cost analysis' means an analytical technique that considers certain costs of owning, using, and operating a facility over its economic life, including but not limited to:
a.	Initial costs;
b.	System repair and replacement costs;
c.	Maintenance costs;
d.	Operating costs, including energy costs; and
e.	Salvage value.
	(7)	'State agency' means the State of North Carolina or any board, bureau, commission, department, institution, or agency of the State.
(8)	 'State-assisted facility' means a facility constructed or renovated in whole or in part with State funds or with funds guaranteed or insured by a State agency.
(9) 	'State facility' means a facility constructed or renovated, by a State agency."
Sec. 4.  G.S. 143-64.12 reads as rewritten:
"§ 143-64.12.  Authority and duties of State agencies. 
(a)	The General Assembly authorizes and directs that State agencies shall carry out the construction and renovation of State facilities, under their jurisdiction in such a manner as to further the policy declared herein, insuring that life-cycle cost analyses and energy-conservation practices are considered and are employed whenever feasible and practicable.
(b)	The Department of Administration, in consultation with the Energy Division, shall, to the extent feasible and practicable, develop and implement policies, procedures, and standards to ensure that State purchasing practices improve energy efficiency and take the cost of the product over the economic life of the product into consideration.  The Department of Administration, in consultation with the Energy Division, shall adopt and implement Building Energy Design Guidelines.  These guidelines shall include energy-use goals and standards, economic assumptions for life-cycle cost analysis, and other criteria on building systems and technologies.  The Department of Administration shall modify the design criteria for construction and renovation of facilities to require that a life-cycle cost analysis be conducted pursuant to G.S. 143-64.15.  The Department of Administration, as part of the Facilities Condition and Assessment Program, shall identify and recommend energy conservation maintenance and operating procedures that are designed to reduce energy consumption within the facility and that require no significant expenditure of funds. State departments, institutions, or agencies shall implement these recommendations.  Where energy management equipment is proposed for State facilities, the maximum interchangeability and compatibility of equipment components shall be required.
The Energy Division shall develop a comprehensive energy management program for State government.  Each State agency shall develop and implement an energy management plan that is consistent with the State's comprehensive energy management program.
																		."
Sec. 5.  G.S. 143-64.13 is repealed.
Sec. 6.  Article 3B of Chapter 143 of the General Statutes is amended by adding a new section to read:
"§ 143-64.15.  Life-cycle cost analysis.
(a)	A life-cycle cost analysis shall include, but not be limited to, the following elements:
(1)	The coordination, orientation, and positioning of the facility on its physical site;
(2)	The amount and type of fenestration employed in the facility;
(3)	Thermal characteristics of materials and the amount of insulation incorporated into the facility design;
(4)	The variable occupancy and operating conditions of the facility, including illumination levels; and
(5)	Architectural features which affect energy consumption.
(b)	The life-cycle cost analysis performed for any State facility shall, in addition to the requirements set forth in subsection (a) of this section, include, but not be limited to, the following:
(1)	An energy-consumption analysis of the facility's energy-consuming systems in accordance with the provisions of subsection (g) of this section;
(2)	The initial estimated cost of each energy-consuming system being compared and evaluated;
(3)	The estimated annual operating cost of all utility requirements;
(4)	The estimated annual cost of maintaining each energy-consuming system; and
(5)	The average estimated replacement cost for each system expressed in annual terms for the economic life of the facility.
(c)	The General Assembly encourages any entity to conduct a life-cycle cost analysis pursuant to this section for the construction of any State-assisted facility or the renovation of any State-assisted facility of 40,000 or more gross square feet.
(d)	The life-cycle cost analysis shall be certified by a registered professional engineer or bear the seal of a North Carolina registered architect, or both.  The engineer or architect shall be particularly qualified by training and experience for the type of work involved, but shall not be employed directly or indirectly by a fuel provider, utility company, or group supported by fuel providers or utility funds. Plans and specifications for facilities involving public funds shall be designed in conformance with the provisions of G.S. 133-1.1.
(e)	In order to protect the integrity of historic buildings, no provision of this Article shall be interpreted to require the implementation of energy-cost measures that conflict with respect to any property eligible for, nominated to, or entered on the National Register of Historic Places, pursuant to the National Historic Preservation Act of 1966, P.L. 89-665; any historic building located within an historic district as provided in Chapters 160A or 153A of the General Statutes; any historic building listed, owned, or under the jurisdiction of an historic properties commission as provided in Chapter 160A or 153A; nor any historic property owned by the State or assisted by the State.
(f)	Selection of the optimum system or combination of systems to be incorporated into the design of the facility shall take into consideration the life-cycle cost analysis over the economic life of the facility.
(g)	The energy-consumption analysis of the operation of energy-consuming systems in a facility shall include, but not be limited to:
(1)	The comparison of two or more system alternatives;
(2)	The simulation or engineering evaluation of each system over the entire range of operation of the facility for a year's operating period; and
(3)	The engineering evaluation of the energy consumption of component equipment in each system considering the operation of such components at other than full or rated outputs."
Sec. 7.  G.S. 143-64.14 is recodified as G.S. 143-64.16.
Sec. 7.1.  G.S. 133-3 reads as rewritten:
"§ 133-3.  Specifications to carry competitive items; substitution of materials.
All architects, engineers, designers, or draftsmen, when providing design services, or writing specifications, directly or indirectly, for materials to be used in any city, county or State work, shall specify in their plans the required performance and design characteristics of such materials.  However, when it is impossible or impractical to specify the required performance and design characteristics for such materials, then the architect, engineer, designer or draftsman may use a brand name specification so long as they cite three or more examples of items of equal design or equivalent design, which would establish an acceptable range for items of equal or equivalent design.  The specifications shall state clearly that the cited examples are used only to denote the quality standard of product desired and that they do not restrict bidders to a specific brand, make, manufacturer or specific name; that they are used only to set forth and convey to bidders the general style, type, character and quality of product desired; and that equivalent products will be acceptable.  Where it is impossible to specify performance and design characteristics for such materials and impossible to cite three or more items due to the fact that there are not that many items of similar or equivalent design in competition, then as many items as are available shall be cited.  On all city, county or State works, the maximum interchangeability and compatibility of cited items shall be required.  The brand of product used on a city, county or State work shall not limit competitive bidding on future works.  If an architect, engineer, designer, draftsman or owner prefers a particular brand of material, then such brand shall be bid as an alternate to the base bid and in such case the base bid shall cite three or more examples of items of equal or equivalent design, which would establish an acceptable range for items of equal or equivalent design.  Substitution of materials, items, or equipment of equal or equivalent design shall be submitted to the architect or engineer for approval or disapproval; such approval or disapproval shall be made by the architect or engineer prior to the opening of bids.  The purpose of this statute is to mandate and encourage free and open competition on public contracts."
Sec. 8.  Sections 1 through 7 of this act are effective upon ratification and apply to all construction and renovation projects for State works that start the design process on or after that date.  Section 7.1 of this act is effective upon ratification and applies to all construction and renovation projects for any city, county or State works that start the design process on or after that date.
In the General Assembly read three times and ratified this the 13th day of July, 1993.

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Dennis A. Wicker
President of the Senate

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Daniel Blue, Jr.
Speaker of the House of Representatives