New London — The Coast Guard Academy is kicking off the largest energy savings project in the history of the Department of Homeland Security, designed to reduce the 85-year-old campus' energy consumption by 48 percent.

The project will involve the replacement of a fuel oil-fired boiler plant with a natural gas plant along with other energy efficiency upgrades such as the installation of solar panels that will generate about 450 kilowatts of power.

The academy is the third largest consumer of energy within the Coast Guard, which falls under DHS. After the project is finished, it will be out of the top 10, officials said. When finished, the academy is expected to save more than $2 million annually in energy costs. Its annual energy costs are about $3 million, according to Cmdr. Josh Fant, facilities engineer.

The project, "when completed and fully used," will pay for itself through energy savings, Superintendent Rear Adm. James Rendon, said Monday at an event marking the start of construction.

Rendon noted the presence of a shovel used in 1931 at the groundbreaking for the construction of the campus at its current location on the west bank of the Thames River. The academy was previously located at Fort Trumbull.

"It's going to be used today to really drive home the scope and the scale, the significance of this unity energy service contract. A contract that is the largest energy service contract in Coast Guard history, for that matter, in DHS history," said Rendon, referring to the $72.6 million contract between the Coast Guard and Eversource. "It's a big deal."

The project, which will involve nearly $40 million of capital utility repairs and improvements at the academy, is expected to take up to two years to complete. The upgrades will take place across 30 campus buildings such as cadet housing and academic labs.

The biggest aspect of the project will involve the boiler plant replacement. The new natural gas plant will be supplemented by a combined heat and power plant that will generate 1 megawatt of electricity onsite with a micro turbine generator.

Work to install a natural gas pipeline on academy grounds has already started outside the gates. The installation of the pipeline at the academy will begin on Monday.

The Coast Guard worked with Eversource, and its subcontractor Ameresco, which will manage the project, for several years to plan the project and to identify various areas where energy improvements could be made. The Coast Guard picked the ones it felt would lead to the greatest return on investments.

j.bergman@theday.com