Floating Solar Panel Project. Council and District Presentation August 2, 2017

Transcription

1 Floating Solar Panel Project Council and District Presentation August 2,

2 Recap: Presentation to Council and District on December 7, 2016 Staff presented results of RFP process to select a PV vendor to install a floating solar system Council approved staff s recommendation to pursue Power Purchase Agreement (PPA) negotiations with Ciel et Terre 2

3 Background 2015 Greenhouse Gas Action Update o Gilleran Energy Management o Water Reclamation Facilities: 45% of Town municipal greenhouse gas emissions Climate Action 2020: Reduce GHG by 25% by 2020 Governor Brown s proposal: Reduce GHG by additional 40% by

4 Floating Solar Array Opportunity Place floating solar panels on a portion of Pond 7, the Town s largest reclaimed water pond. Pond surface can be used to provide clean energy for the Geysers Pump Station, Corporation Yard, & Wastewater Facility (WRF) Preserve undeveloped areas in the Corporation Yard for future beneficial use 4

5 Close-up of Ciel & Terre Hydrelio Solar Floats 5

6 PPA Advantages Town will pay no capital cost Solar Array optimally-sized for energy demands of the treatment plant, Corporation Yard, and Geyser s Pump Station Town will not own nor have any responsibility to maintain system Solar energy purchased at a lower rate than current costs Town and District will retain all environmental credits 6

7 Three Agreements Power Purchase Agreement (PPA) Town and Water District Lease Agreement Water District Option to Lease Agreement (OLA) Water District 7

8 25-year Term PPA Starting price of 10.5 cents/kwh with 2% annual increase PG&E/SCP cost would be 13.4 cents/kwh Utility Costs historically increase 4% per year Projected Year 1 savings of $87,000 in energy costs Net Present Value of ~ $4.0 M savings over 25 years Pricing based on Aggregated Net Metering Includes prevailing wages for both construction and maintenance of the solar array Approximately 1.7 MW DC solar array 5,046 panels Approximately 4.11 acres on pond Covers ~ 22% of pond surface 8

9 PPA 9

10 Lease Agreement Provides Ciel et Terre legal access to pond surface, including easements for access, equipment, etc. Rental rate based on 2013 SCWA Memorandum $800 per acre per year = estimated $3,520 per year. Contains language for logistics, O&M, & safety Commits Ciel et Terre to standard Town construction and building department protocols, and insurance requirements Contains provisions for mosquito abatement Contains provisions for moving/removing/replacing the solar array if ever needed 10

11 PPA and Lease The PPA and Lease exist together One does not exist without the other 11

12 Option to Lease Agreement Temporary document Gives Ciel et Terre exclusive option to initiate PPA and Lease when ready During the OLA Period Ciel et Terre will Complete a PG&E interconnection application and begin final design of the system Complete Engineering investigations Perform CEQA documentation Develop Mosquito Abatement Plan OLA Period is expected to last 15 months with certain allowances for exceptions 12

13 Option to Lease Agreement By signing the OLA, Ciel et Terre is provided assurances that during the option period: Town and District will not enter into an agreement with another floating solar panel provider on Pond 7 District will not lease Pond 7 area to another entity 13

14 Option to Lease Agreement Ciel et Terre may opt out of the PPA and lease during the OLA period Town/District may opt out at a cost of $20,000 intended to partially repay Ciel et Terre for lost engineering costs. Once Ciel et Terre s exercises the option, the OLA is terminated and the PPA and Lease terms begin. All three agreements will be signed at the same time but the PPA and Lease will have no effect until the option is exercised 14

15 Special Provisions of Agreements Anticipated Shutdowns Unplanned Shutdowns Mosquito Abatement Plan Pond Operation and Maintenance by Town 15

16 PPA System Shutdown by Town Up to 48 hours per year of normal downtime no charge If Town requests a shutdown for reasons within its control : Three months or less» Town pays Ciel et Terre for lost energy and associated profit according to the PPA rates Between three and six months» Town pays no reimbursement to Ciel et Terre; however, the PPA term will be extended for a period to allow Ciel et Terre to recover revenues lost during the down time Greater than six months» Town will make monthly payments to Ciel et Terre in amounts equal to the average of previous years payments for the period in question. PPA term will be extended and the Town will be credited for future electricity. 16

17 System Shutdown - Unplanned If the solar system is shut down for reasons outside of the Town s control, such as regulatory requirements and orders: No reimbursement to Ciel et Terre The term of the PPA will be extended for a period to allow Ciel et Terre to recover revenues lost during the down time. 17

18 PPA System Shutdown If the solar system is shut down for reasons outside of the Town s control, such as regulatory requirements or orders: No reimbursement to Ciel et Terre The term of the PPA will be extended for a period to allow Ciel et Terre to recover revenues lost during the down time 18

19 Mosquito Abatement Discussions with MSMVCD regarding floating solar project 19

20 Lease Agreement Move/relocate Solar Array If solar array has to be temporarily moved from one side of the pond to the other Or, if the solar array has to be removed completely and then reestablished Work will be performed by Ciel et Terre on a time-andmaterials-basis, separate from the PPA payments. Year Zero estimated costs: Move array: $141,795 Remove/replace the array: $393,282 Net Present Value savings realized by the of project with one remove/replace in ten years = $3.64 M Ciel et Terre and Town will collaborate to avoid the full costs of a remove/replace, and keep the array on during any periods of construction. 20

21 Recommendation Authorize the Town Manager/General Manager approve and sign PPA, Lease Agreement, and OLA Begin the OLA Period for Ciel et Terre to begin the PG&E interconnection application and engineering design 21

22 22 Questions

23 23

24 24

25 Close-up of Solar Floats 25

26 MSMVCD is: Lease Agreement Mosquito Abatement Collaborating with Town and Ciel et Terre Expressed reasonable confidence in the mosquito abatement plans for the floating solar array Ciel et Terre will construct the solar array with features to abate mosquito larvae growth, including insecticide injection points. Town will continue to pay for insecticides used Town and MSMVCD will continue to abate mosquito larvae growth outside of the solar array footprint. 26

27 Energy and Financial Assumptions 2.0% Inflation Rate 3.0% Discount Rate 4.0% Energy Escalation 0.5% Output Degradation 25 Year System Life 27