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Board evaluates proposal to generate solar power

Nov. 24, 2015

Schalmont Board of Education is considering a proposal to install a solar panel system on district property that has the potential to save the district nearly $1.9 million in utility bills over the course of 18 years.

The New York Power Authority, the New York State Energy Research and Development Authority and the New York State Education Department have joined forces to make solar energy more accessible and affordable for schools.
Under a project titled K-Solar, New York state school districts have the opportunity to work with SolarCity, a company that will help districts bring solar energy to their facilities and reduce energy costs.

In the proposal brought to Schalmont by SolarCity, the district would host the system by providing land for the panels, and SolarCity would pay for all costs and labor related to installing and maintaining a solar system on district property.

“There is no cost to the school until the system is operational,” SolarCity Senior Project Development Manager Dan Leary said.

In simplified terms, the district would be generating energy on behalf of SolarCity. The power generated by the panels would be sold to the Power Authority, which would result in a credit on future district utility bills. The district would then pay SolarCity for the energy produced by the panels at a lower rate.

“We are partnering up for the utility to buy energy from us,” Leary said.

For example, the current rate for sale of energy to the Power Authority is 12 cents per kilowatt hour. If the power purchase agreement with SolarCity sets the cost to the district at 6 cents per kilowatt hour, the district nets 6 cents per kilowatt hour. So if the solar panels generated 100 kilowatt hours, the Power Authority would credit the district $12. The district would then pay SolarCity its fee of $6, leaving the district with a $6 “profit” in the form of a utility credit on the actual energy bill for the district.

In the proposal, SolarCity would install enough panels to produce about 1,200,000 kilowatt hours annually, guaranteed by the company. This agreement could potentially save the district $92,000 in the first year and nearly $1.9 million in energy costs throughout the 18-year term. SolarCity guarantees the district that it will not pay more for solar than for energy from the Power Authority.

“The worst case scenario is that we end up paying what we are paying now,” said Business Administrator Joseph Lenz. “The best case is that our utility bill drops to or close to zero.”

Also as part of the agreement, a K-solar educational package would be available that would include solar curriculum educational materials, professional development workshops for teacher, toolkits and access to monitoring the energy output.

When the 18-year agreement ends, the district would have the option to continue the agreement, to buy the system (which has an average lifespan of 25-30 years) or have SolarCity remove it at no cost to the district.
The board will discuss the proposal further at the Dec. 10 work session and plans to make a decision at the Dec. 14 meeting. If the board decides to enter into the agreement, the system is expected to be up and functional before the end of 2016.