Largest Solar Installation In Alaska Is Forced To Take It Down Due To Red Tape
Categories: Energy, Education, Construction Methods, Zoning&Codes, News
Bristol Bay Borough Alaska is known as the "Red Salmon Capital of the World," with a small town of about 1000 year-round residents that bolsters during the Summer to about 10,000 including fishermen and processors. The local school district teaches about 120 students, and has about 90,000 square feet of building space to warm throughout the winter. The schools' annual electric bills reel at about $360,000 per year, as you can imagine under the frigid and dark winter season. The high recurring electric bills no doubt have lead to the search for greener pastures and lower cost alternatives. A comment by a local graduate on our Facebook page lead to some digging and this previously un-reported story:
Two years ago, according to Superintendent Bill Hill, after extensive research and communications over the possibilities, the district, strapped for budget under a shrinking student population sought out to install solar panels on the school. A number of options were explored, but some of those did not lead to saving money. The local legislature decided to retroactively cancel a debt-reimbursement program, and then also declined to fund the schools maintenance needs, and suggested where to find a loan.
Superintendent Hill suggests that going in debt is the last thing he wants to do. It's always better for everyone when bills are paid. And so.... they ended up with this package deal:
The district entered into a power-purchase agreement to install 50 Kilowatts of solar panels on the school. The high local costs of energy (about 54 cents per kwh) make the changeover a no-brainer, and the savings was to be extraordinary! A power purchase agreement is where the solar company of choice opts to pay for the panels and install them on the school with their own money, and then to recover the costs plus profits by a recurring monthly bill. This prevents the school from owing a debt for the installation, and keeps maintenance and ownership for the equipment in the hands of the third party.
The panels were installed about two years ago, and the school had the feel-good vibe of knowing they were producing power from the sunshine, and saving lots of money while doing it!
Here's where thinks got messy. The power company (NEA) just down the road is operated as a non profit co-op, where those who use power are co-members. As a part of their agreement, no entity in the co-op may buy energy from another energy company. Now had the school financed or bought the solar panels, there wouldn't be a problem here, but since an outside company installed the panels, the school is technically buying power from them, the school is in breach of their co-op agreement by installing the solar, and was forced to remove the equipment.
So as to say - "No Hard Feelings," the power co-op purchased the panels from the third-party supplier, and today those panels are sitting in the waste-water treatment area of the compound.
Today, the school still pays full price for electricity, and are still struggling to make ends meet. The beautifully installed solar panels are no longer showcasing for the community just what the sun can do. What turned out to be an internal conflict among co-op-ees has turned into a loss of natural energy for the school, the high costs stand, and in the end, the students are the ones who lose.
Living Off The Grid
(if some of my details are out of order, or you have better intel, please send additional info to firstname.lastname@example.org)
The following detail on the original project proposal sourced from this pdf
1050 Bristol Bay Borough School District Solar PV Project Proposer: Bristol Bay Borough School District Benefit/Cost Ratio: Applicant: 1.28 AEA: 0.96
This project consists of a 50 kW (d.c. rating) ground‐mounted photovoltaic (PV) system, to be installed next to the school building. The system will provide renewable energy to the school and also provide an opportunity for the school’s students and community to learn about PV. The system will be composed of (200) 250‐watt photovoltaic (PV) collector panels (e.g. Solarworld 250W monocrystalline or equivalent), 50 kW DC to AC power inverter capacity (multiple smaller inverters, e.g. SMA Sunnyboy 6000TL) and a data acquisition system with a graphical display inside the building and accessible through the Internet. The panels will be wired in multiple DC series circuits called strings. The strings will be wired to a combiner box, then connect to the power inverter(s) which transforms the DC power into AC power suitable for use by the building’s existing electrical system. The inverter assures that the PV generated power is compatible with the power supplied by the utility grid and will disconnect from the electrical system in the event of a utility power outage to prevent “back feed” to the utility grid. The proposed system is sized to supplement current electric usage and peak demand only, as it will not store power. The proposed system will be interconnected with the electrical system and controlled to “follow” the existing systems’ electrical characteristics. A dedicated data acquisition system tied directly to the inverter will display the performance of the PV system and describe how it works through a dedicated live display setup in the lobby. A revenue grade utility meter will also be installed on the PV system to accurately measure the power generated.
Total project cost = $235,000 Grant funds requested = $230,000
Contribution to Lower the Cost of Energy:
Electricity is provided to the school by Naknek Electric Association (NEA) utility. The current price per kWh for the school is $0.54/kWh, meaning that a PV project that offset the estimated 42,350 kWh per year would save nearly $22,869 annually for the district. The PV project does not directly lower the cost of power set by the utility, because the project has no firm plans to sell low‐cost electricity back to NEA and NEA does not offer net metering. The project does reduce the school’s annual purchase of electricity.
System Capacity: The annual kWh output capacity of 42,367 for King Salmon is provided by applicant using the PVWatts site. AEA analysis uses lower potential displacement (35,390) to reflect the seasonality of the resource and the mismatch with the building: school is not in session when potential generation is highest, in high generation months when school is in session (March, April, May, August and September) it is not possible for the school to use all of the generation produced by 12 hours of daylight, and there is no arrangement for selling excess power to the utility. Generation was also reduced 1% per year as that is typical performance deterioration in solar systems.
Capacity Factor: The applicant does not provide a capacity factor. Using the kWh output estimated by the applicant (using PVWatts) and the same kWh output adjusted for sunlight hours, two capacity factors are calculated. The capacity factors, 9.7% using the applicant’s estimated output and 8.1% using an adjusted output, are both on the low end of the feasibility range for PV solar arrays in Alaska.
Fuel Efficiency: The applicant uses a diesel fuel efficiency rate of 14.5 kWh per gallon. The AEA benchmark, 13, is used in the AEA calculations.
Capital Cost: The applicant’s capital cost estimate is used in the AEA calculations.
Annual O&M Cost: The applicant’s O&M estimate of $500 per year is used in the AEA calculations. An additional $750/year over applicant figures is estimated for annual check‐ups and minor electrical. The application states that this cost will be covered by the school general fund from savings generated by the project but they are still project costs. This estimate is considered conservative.
No Resumes attached to the application. Although the application contains a list of Bristol Bay School District contacts, it does not provide key roles or resumes to allow for an assessment of management capacity.
Missing Reconnaissance and Feasibility Stage. Applicant indicates grant is only for the final design & permitting and construction & commissioning stages; however, no mention is made of any work done to assess the feasibility of the project. With a request of over $200,000, more information is required.
Commitment on Sale of Solar Electricity. Applicant indicates coordination will be undertaken to sell excess electricity to NEA. As mentioned above, further work on coordinating the sale of electricity needs to be done for a project of this size. The local utility does not have net metering at this time and communication with the utility indicates that they do not plan to implement net metering in the foreseeable future.
Provide letter of support from local utility
Provide resumes of staff from Bristol Bay Borough School District working on this project.
Provide feasibility and technical plans for storage or sale of excess electricity produced by the solar array.
Provide sustainability plan with details on sources of funding for maintaining solar array over life of project.
Applicant indicates three sources of back‐up/funding for maintaining the solar array through the life of the project: extended warranties, general school funds, and savings from the project. Without further discussion of a developed sustainability plan and maintenance plan, the ability for the school district to maintain the system over the next 30 years is unclear.
Applicant intends to rely on extended warranties to cover the cost of repair and replacement of essential solar array equipment – panels and inverters. The manufacturer warranties on both are limited, so will be void if problem is caused by a number of external factors – improper maintenance, weather, dirt, etc.
The letter of support from the Bristol Bay Borough School District does not mention using school funds for project maintenance.
Using savings for maintenance may be a possibility; however, the applicant would need to provide a plan for how the savings will be set‐aside and the amount that would be available should repair and replacement, not covered by the warranty, be required during the first 30 years of the project. Potential public benefits: Reduction in diesel consumption and low‐cost electricity for the Bristol Bay Borough School District.