An Introductory Proposal for Powering Town-owned Buildings with Photovoltaics (solar energy)

1
Solar Power for our Town

• An Introductory Proposal for Powering Town-owned
  Buildings with Photovoltaics (solar energy)

2
Purpose

• To introduce the concept of using solar energy to
  supplement the power supply for town buildings

3
Overview

• Photovoltaics
• What it is
• Why its important
• What it can do for our town
• Financial issues
• Typical savings
• Different ways of financing system
• Help from state and federal government
• Case study Yarmouth, MA
• Next steps
• Why we should take action now

4
What is Solar Photovoltaic Power?

• solar cells made of semiconducting materials
  sunlight liberates electrons from material to
  produce electricity
• rooftop, grid-tied or off-grid
• grid-tied can be 'net metered'
• payback time a function of upfront cost/avoided
  utility payments

5
Where's all the sun?

Map courtesy of National Renewable Energy
Laboratory, U.S. Department of Energy
6
Climate Security Why Solar is so Important

• Need to reduce emissions by 80 by 2050 to
  mitigate worst of climate change effects
• Phase out coal plants
• Replace with the optimum mix of non-emitting
  energy sources to accommodate
• all our current electricity demands
• the increased electricity demands of a growing
  population
• the increased electricity demands of new modes of
  transportation

7
What can a Municipal PV System do?

• Transfer part of municipal energy load to clean,
  zero-fuel, renewable power source
• Reduce monthly municipal expenditure on energy,
  including transmission costs
• Hedge against future fuel price increases and
  upward pressure on property taxes
• Employ local businesses in construction, etc.
• Create image of town as forward-looking,
  intelligent community suitable for business
  investment

8
Typical Savings with PV System
approx. rate in NY, NJ, CT, MA, CA in 08/08.
Rates have risen 30 since 2003.
9
Bottom Line Whats the Price Tag?

• Rule of thumb 10/Watt installed (so 10kW
  system 100,000)
• Deduct federal and/or state subsidies/rebates
  from this figure. It could cut upfront cost in
  half!(e.g. In 2008, Massachusetts
  ratepayer-funded program covered 50 of Yarmouth
  Town Hall installation)
• Assuming federal/state assistance and anticipated
  increases in electricity prices, system may break
  even in as little as 10 years(with 10-30 years
  life remaining)

10
Different Ways of Purchasing System (1)
With acknowledgement to the Customers Guide to
Solar Power Purchase Agreements (Rahus Institute)

11
Different Ways of Purchasing System (2)
With acknowledgement to the Customers Guide to
Solar Power Purchase Agreements (Rahus Institute)
12
Incentives/Rebates/Grants Available to Towns in
State of _______________

• (The citizen presenter should customize this
  slide to the town and state of residence. Data
  on federal and state assistance for renewables
  can be found at http//www.solar-nation.org/why-s
  olar/govt-incentives-for-renewable-energy/)

13
Alternative Financing Options (1)
Solar Power Purchase Agreement (SPPA)

• Outside investor (3rd Party) buys, installs
  owns system
• 3rd Party sells power to Town for set period (20
  yrs?) at agreed rate
• 3rd Party enjoys tax credits, incentives, etc.
  (which town govt. may be unable to do)
• At end of period, Town may buy system or renew
  PPA

14
Alternative Financing Options (2)
Flip Model (with Special Purpose Entity)

• Outside investor and Town jointly fund system
  thru Special Purpose Entity (SPE)--often an
  LLC--with investor as majority owner
• SPE sells power to Town for set period (20 yrs?)
  at agreed rate
• SPE enjoys tax credits, incentives, etc. (which
  Town may be unable to do)
• At agreed point (6 yrs. ?), Town becomes
  majority owner, may buy system at discount

15
Bottom Line for Spent

• State and/or federal govt. may significantly
  reduce initial outlay, irrespective of financing
  model used
• Lease-to-own or flip financing model may
  significantly reduce initial outlay, irrespective
  of government assistance
• One building generally too small for SPPA, but
  treat all municipal buildings as one project to
  attract investor. Even so, lease-to-own may be
  more realistic for small-to-medium size towns
• How do you quantify putting your town ahead of
  the curve of history!?

16
Case Study Yarmouth, MA
17
Never doubt that a small group of thoughtful,
committed citizens can change the world indeed,
its the only thing that ever has.

-Margaret Mead

• Peter White organized 10 residents of Yarmouth to
  put article on Town Meeting warrant for
  solarizing town hall
• MA Technology Collaboratives Small Renewables
  Initiative Grant offered to match towns
  contribution to cost

Peter White
18
Never doubt that a small group of thoughtful,
committed citizens can change the world indeed,
its the only thing that ever has.

-Margaret Mead

• Liz Argo of SolarWrights Inc. proposed 10.5kW
  system (60 panels)
• System produces 12,000kWh per year, saving 2400
  (based on existing rate of 0.20/kWh)
• Total system cost 100,000
• Town paid 50,000
• State paid 50,000

Liz Argo
19
Never doubt that a small group of thoughtful,
committed citizens can change the world indeed,
its the only thing that ever has.-Margaret Mead

• With predictable rise in electrical costs,
  payback should be lt13 yrs.
• 9 months after commissioning, total kW output is
  at least as much as forecast
• gt20,000lbs. of CO2, 31lbs. of NO, 94lbs. of SO2
  prevented from entering atmosphere every year
• Benefit equivalent to planting 3 acres of trees
• Town is now building 2nd installation at Chamber
  of Commerce/Rec. Dept.

completed town hall installation
20
Two Other Towns that Got the Message

• Lagunitas School District, San Geronimo, CA
  (49.3kW system)
• Water treatment plant, Pendleton, OR(100kW
  system)

21
Next Steps

• Define scope of project
• Identify possible installation locations
• Assess energy efficiency measures and costs
• Research more accurate installation costs
• Confirm rebate/subsidy entitlements from state
  and federal sources
• Decide on financing model to be used and find
  investors/partners/vendors appropriate to that
  model
• Negotiate contract

22
Resources and References
23
Why Should we Take Action Now?

• Electricity prices based on fossil fuels will
  continue to rise
• Need to reduce GHG emissions for climate security
  affects every part of the economy
• State and/or federal rebates/credits in force now
  (and may not be later)

24
Solar Power for our Town

• Any Questions?