Bear Valley Community Services District

Archived Project

Solar Project Presentation

An overview of the benefits and options of a solar project for the BVCSD

T

he District has been contemplating a solar project for a number of years. We currently pay Southern California Edison (SCE) over $500,000 per year in electric costs to power its facilities, wells, boosters and treatment plant. A solar project conceptually will:

  • Reduce the amount the District pays each year for electricity (resulting savings can be applied to other District needs)
  • Provide a hedge against rising power rates (the District's rates increased ~10.5% in FY 2012/13 and ~18.5% in FY 2013/14)

Project Expectations

A solar project will NOT:

  • Make the District a utility company - we would not be selling power to other users. All power generated is intended to be used by the District
  • Require building power transmission lines - the District would continue to use SEC's distribution system for the delivery of power to our facilities

The Project should pay for itself, through a bill reduction after debt servicing, maintenance, operational costs, and various other expenses. The project must comply with all applicable laws and regulations including:

  • The California Environmental Quality Act (CEQA) concerning placement and visual impacts
  • Kern County Planning & Zoning requirements
  • California Public Utility Commission

The District initially sent out a Request for Qualifications (RFQ) for an independent solar consultant to prepare an analysis of District needs. At the February 13, 2014 Regular Board Meeting, the Board tabled an Agenda item to hire a consultant to provide independent analysis. At that meeting, staff were directed to solicit proposals from vendors/turn-key providers (Heliopower, RecSolar, Borrego Solar, and Sun Power). The board initially obtained a proposal from SunPower.

At the June 10, 2014 Special Board Meeting, the Board heard presentations from providers. Staff were directed to negotiate with SunPower to reduce their price from $3.1 million to $2.8 million. SunPower countered with a $161,933 reduction.

The SunPower Project Concept

  • 1,009.2 kW fixed tilt (non-moving) plant adjacent to the Cummings Valley Booster Station
  • Approx. 5 acres in size, north of Tehachapi Turf on land not currently being farmed, at the extreme edge of the usable land.
  • Renewable energy self-generation bill credit transfer program (RESBCT) - allows local government agencies to generate electricity at one meter location and transfer any excess bill credits to another account owned by the same local agency
  • The project could be financed with a 20 year loan with an interest rate of approximately 4%
  • Due to debt servicing and cash flow fluctuations such as rates, rebates, and maintenance costs, the project will have varied return (bill reduction)

SunPower estimates the project will provide SCE bill reduction of:

  • $62,000 - $101,000 per year for the first 10 years
  • $33,000 - $179,000 in years 11 through 20
  • $390,000 to $500,000 in years 20-30 after the loan is paid

Alternatives

Unfortunately, the vendor/turn-key approach resulted in proposals too diverse for an 'apples-to-apples' comparison of projects and potential cost savings benefits. Our options are:

  • Continue with the SunPower project concept via the Letter of Agreement authorized by theBoard on July 10, 2014
  • Choose a different project concept and/or proposal
  • Hire an independent consultant who is not a solar vendor to give an impartial analysis
Independent Consultant

As previously mentioned, the Board tabled an Agenda item to hire an independent consultant. A formal process has already been completed, with three firms recommended to the Board by the Infrastructure Committee:

  • AECOM
  • Helio Power
  • REC Solar

AECOM has a dedicated solar consulting division, is the only firm that is not a vendor/installer, and can therefore impartially provide:

  • Analysis of the District's solar needs
  • Analysis of our power consumption
  • Preliminary design and potential site location(s)
  • Financial analysis and potential cost savings
  • Assistance with project management

The Staff has recommended that an independent solar consultant be hired. Staff has been directed to negotiate with the number one ranked firm from the Request for Qualifications process (AECOM). Pending above direction, the Board will be presented a contract for formal consideration at a future date (public process). No formal action is requested tonight, only consensus as to direction.