photovoltaic project report elizabeth mcmanus deputy superintendent san mateo union high school...

Photovoltaic Project Report

Elizabeth McManusDeputy Superintendent

San Mateo Union High School District

San Mateo Union High School DistrictPhotovoltaic Project

December 5, 2011


Agenda• District Goals

• Financial Consideration• Existing kW usage• Historical PGE increases• Optimal project system size• Revenue Opportunities

• REC’s• PGE CSI PBI Credits

• Financial funding mechanisms • Net Present Value

• Net Metering• Construction methodology• Energy Efficiency• Environmental Benefits• Pubic Agency Needs and Lessons learned


Goals

• Determine viability of solar photovoltaic systems and best plan for implementation

• Conduct comprehensive analysis to determine system feasibility including following considerations

• Energy usage evaluation• Existing facility assessment• Energy audit of all facilities• Financial feasibility• Funding methods• Best construction delivery method - Future developments of solar PVs• Solar curriculum development- workforce & skills training program for

students• Community leadership- sustainable living


Financing Options

• Ownership Strategies Service agreement, not a financing

• Utility service agreements• Power purchase agreements• Energy assets owned by third party• Lease roofs for up to 25 years• Lack of control on construction• Host customer purchases output at a fixed price• Model dependent upon annual utility escalation (risk)• PPA provider earns PGE CSI PBI’s• PPA provider earns Federal tax credits• PPA presents financial risks to Districts-5 year reality check

• Acquisition Strategy • General Obligation Bonds (Max General Fund Relief)• Certificate of Participation (General Fund Stabilization)• Clean Renewable Energy Bonds (General Fund Stabilization)


Funding Opportunities

• California Solar Initiative • Performance Based Initiatives

• Without PBI’s solar projects do not pencil• Financial tipping point

• Renewable Energy Credits• Emerging markets• PUC market-uncertain


Educational Benefits

• 8,100 high school students and 14,000 adult education students will have hands-on experience of renewable energy

• Design Build RFP required most responsible proposer to develop curriculum, purchase equipment and supplies and provide continued staff inservice

• System includes kiosks that provide real time monitoring by entire community making it real and measurable

• Specialized green career technology courses offered


Energy Audits

• Best practice combines energy efficiency programs with deployment of solar project allowing system to be appropriately sized and realize maximum cost benefit

• PG&E conducted energy audit• Conducted CEC Bright Schools Audit• District created and implemented an “Energy Efficiency Plan”

that integrates curriculum and operational behavior to ensure energy efficiency measures are sustained and enhanced


Energy Audits

• Energy efficiency audit forms required for Performance Based Incentives (PBI) rebate application

• Board approved CHPS standards• Increased HVAC efficiency with controls• Dimming ballasts in classrooms• High efficiency T-5 lighting• Windows:

• Insulated glass (higher R value, less noise)• Low E (infrared heat reflective)

• Daylighting Controls:• Shading devices• Dimmable sola tubes replace large skylights• Efficient food service equipment


Energy Measures Implemented

• Boilers• Steam systems replaced with high efficiency hot water systems• CHS, HHS, MHS, SMHS)

• Roofs• Higher R value• Reflective white cap sheet

• Replacing Transite siding with higher R value materials• Improved weather stripping on replaced doors• Completed T-5 and dimming ballast retrofit of existing lighting• Add control points for HVAC systems

• Outdoor air temperature sensors• Motorized air dampers• Door contactors

• Pools• Solar thermal heating systems• Install and use pool covers• High efficiency pumps


Energy Measures Pending

• Exterior walls• Cover replace tranlite with higher R value materials• Improved pest control

• Vending misers• Behavioral Changes

• Under counter refrigerators• Radiant heaters• Microwaves and hot plates

• Landscaping


Environmental Benefits

• Reduce need for new fossil fuel burning generating plants• System offset of CO2 into atmosphere each year:

• 2,840,000 lbs• 1,420 tons

• Equal to removing 36,800 cars from the road• Equal to planting 218,400 trees• Equal to planting 546 acres of forest


• Net metering would allow school districts to realize maximum financial benefits and ensure system success

• Solar projects do not work at all sites• Offset the cost of electricity• District is interconnected to the PG&E grid,

and a "net meter" is installed to measure the difference between electricity supplied to the customer by PG&E, and the electricity the customer exports to the grid, over a billing month.

• Typically, solar systems export more energy during the summer months, generating credits for SMUHSD to use during the winter months.

Net-Metering

12


• Offset the cost of electricity

• A "net meter" is installed to measure the difference between electricity supplied to the customer by PG&E, and electricity the customer exports to the grid, over a billing month.

• Typically, solar systems export more energy during the summer months, generating credits for SMUHSD to use during the winter months.

Net-Metering

13


Funding Opportunities

• California Solar Initiative • Performance Based Initiatives• Net Metering

• Renewable Energy Credits• Emerging markets


• Historical usages and future needs

• Future construction projects

• Other energy efficiency implementations

• Peak solar hours per year

• Future PG&E escalation

• Size and type of panels

• System economy of scale

• Final CPUC interpretation of AB2466

Criteria for Determining Optimum Solar Size

15


RECOMMENDED APPROACH

• 4-schools provided best PV opportunities for lowest cost - Large roof areas create efficient panel layout• 2 schools provided with PV systems for educational purposes

• Lower Installed Cost Per kWh (economy of scale)

RECOMMENDED APPROACH ACHIEVES:

• Substantial General Fund Relief• Maximum revenue from CSI PBI’s (at Step 6)• Minimal impact to site ground areas including parking lots• 72% reduction in electric energy costs• Minimizes construction disruption by aligning with existing projects


Aragon High School N

Roof Mount - 201051,100 sq. ft.


Aragon High School

Annual Electrical Cost $237,528 (in 2009)

Annual Energy Savings*

Starting 2012 (81%) $193,447

PV Location & Year

* Assumes no escalation in cost of energy

Annual Electrical Cost *

Starting 2012 (19%) $44,081

60%

50%

35%

50%

50%

75%

PV System Size 1,000 KW

General Fund Savings*


Burlingame High School


N

Burlingame HS

Annual Electrical Cost $193,233 (in 2009)


Starting 2012 (31.4%) $60,675


Starting 2012 (68.6%) $132,558

PV Location & Year

50%

75% 50%



PV System Size 340 kW


N

Roof Mount – Phase 1

Capuchino HS

Annual Electrical Cost $172,574


Starting 2012 (4%) $6,903


Starting 2012 (96%) ($165,671)

* Assumes no escalation in the cost of energy


PV System Size 41 kW DC


Hillsdale High School

N



Hillsdale HS

Annual Electrical Cost = $198,643 (in 2009)


Starting 2012 (87%) $175,754

PV Location & Year


Starting 2012 ( 13%)$22,889

50%

50%50%

50%

50%

50%





Mills High School

N

Roof Mount – 201019,700 sq. ft.


Mills High School

Annual Electrical Cost * $220,508 (in 2009)


Starting 2012 (71.7%) $188,960


Starting 2012 (28.3%) $31,548

PV Location & Year

75%75%

50%50%

40%

50% 50%

40%

50%50%





N

Roof Mount – Phase 1

San Mateo HS

Annual Electrical Cost $251,389


Starting 2012 (1%) $2,514


Starting 2012 (99%) ($248,875)

* Assumes no escalation in the cost of energy

PV System Size 9.7 kW DC



Key Points for Solar at SMUHSD

• 2010 District electricity bill: $1,545,000• Due to escalating energy costs alone:

– $2,600,000 for 2019-2020– $4,400,000 for 2029-2030– Total PG&E bill for 25 years: $77,320,000

• Install 3.7 Mega-Watt Solar PV system:– Project cost: $28,000,000 (including roofs)– Financed using General Obligation Bonds– California Solar Initiative (CSI) pays 22% of cost– Offsets about 48% of District usage– Reduce PG&E bill by 72%– 25-year General Fund Savings: $58,000,000


Aragon HS – Daily Electricity Usage


Aragon HS – Daily PV Production


Aragon HS – Solar PV Net Meter


Aragon HS – Solar PV Annual Results


Mills HS – Solar PV Installation


25-Year Assumptions

• Total project cost: $3.1M• PG&E Escalation: 5.34% per year

– 1978-2008 PG&E industrial electricity base rate CAGR

• CSI incentive: $0.26/kWh for 5 years at Step 6• 3% annual inflation of O&M costs• 10-year total system warranty• 10-year 95% Performance Guarantee• 25-year solar panel warranty• 25-year system lifetime• Renewable Energy Credits (RECs) valued at $0.00

– Opportunity for further income generation


Baseline Model (most likely)


MODIFIED DESIGN BUILD (DESIGN ASSIST)

• Architect works for District• Solar world composed of manufactures/installers or sole source providers known as

Integrators• PV panels

• Different shapes and sizes• Produce different levels of electricity• Different lifespan and durability

• PV integrators• Manufacture and install PV panels • Installer have agreements with PV panel manufactures as sole source providers• Type of panel must be known for accurate panel layout• Panel type will impact electrical projection levels

• Design Assist allows District architect to work with PV integrator to determine type and panel and precise layout to generate maximum electric output

• Design-Build allows contractor/integrators to submit proposal• Design Assist is the best delivery method to achieve reduced project costs and expedite

project completion• Proposal may be awarded based on best value - not required to be lowest price


DESIGN-BUILD CONSTRUCTION CONTRACT PROCESS

•Part I – Qualifications of Contractor

• Experience, capability and capacity• Financial strength• Successful experience with large PV installations • Proven experience meeting budget and schedule• Experience with Division of State Architect• Reviewed by Capital Projects team• Reviewed by Construction Committee• Recommended to Board of Trustees• Approved by Board of Trustees


DESIGN-BUILD CONSTRUCTION CONTRACT PROCESS

•Proposal Part II - Proposals

• Review will be based on “best value” to District and may not the lowest price

• Proposal will be reviewed:• Capital Facilities Project team• Construction Committee• Recommendation to Board of Trustees• Approved by Board of Trustees


DESIGN- BUILDCONSTRUCTION CONTRACT PROCESS

•Contract Key Requirements• Performance and Payment Bonds• Performance guarantees of output and efficiencies for lifespan of panels• System maintenance and monitoring (clean PV panels)• Specify type of PV panels and inverters• Minimum of 3 sub-contracts at guaranteed price aligned with other

construction project schedules• Develop curriculum, classroom delivery and staff training • Provide equipment and instructional materials for coursework• Inverter replacement - 10 Year Warranty• Panel Replacement - 25 Year Warranty


Lessons Learned• No easy button, Districts must do their homework• All information provided must be validated for accuracy and reasonableness• Plenty of opportunists in this field. Schools if they do not do appropriate due

diligence and validate assumptions will be rudely awaken at the end of 5 years when the PBI’s are no longer available and utility escalations were overstated and the savings do not materialize

• Three prong approach• Attorney • Finance • Construction

• Change in PGE invoicing procedure annual utility bill• Solar is a relatively new market, disappointment with the lack of

sophistication and integrity demonstrated by integrator despite strong contractual language

• Without PBI’s and net metering, concerns regarding the long term viability and benefits for schools in the future

photovoltaic project report elizabeth mcmanus deputy superintendent san mateo union high school...

Documents

energy efficiency plan

energy efficiency programs

energy efficiency measures

deployment of solar

enhanced slide

hvac efficiency

financial risks

financial tipping