2014-11-25_PWETC_Minutes - Laserfiche WebLink

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PACE funding for the system's construction costs; and typical prices for construction and investor profit potential over time and paid by from revenues in comparison to using an SPPA loan that would provide positive cash flow from the start. Additional discussion included minimal differences through any economies of scale; full ownership by the City after 10 years of semi-annual payments to the SPPA; responsibility for ownership of the hardware depending on which option was chosen; and warranties for panels and inverters based on 100%production numbers and typical degradation, estimating 80%production at 20 years. Further discussion included typical terms for power purchase agreements at 20 years to allow for depreciation of equipment and a return on the investment, with a profit typical at year 12 to 15; continued panel electrical production beyond their expected lifespan of twenty-five years; and potential purchase of the equipment at a nominal cost after the contract term expires providing continuing operations. Discussion ensued regarding the manufacturers used by Sundial Solar; options for sizing the solar arrays based on their construction costs and/or extra power produced;preference for roof mounted installations versus ground mounts; and recognition of the competitiveness and attractiveness of the SPPA financing, with consultation sought by staff from the City's Finance Director on his recommendations on financing the system. Mr. Schwartz noted that the City Council had previously signed onto a Joint Powers Agreement (JPA) with the St. Paul Port Authority to allow properties to access that money, as well as other commercial entities. Mr. Weir advised that the SPPA would not authorize a project unless the analysis and proforma found the cash flow to be positive. At the request of Chair Stenlund, Mr. Weir reviewed the possibility of new technologies and better solar panels over time that may make a current installation obsolete or no longer cost effective during that twenty-five year period. Mr. Weir advised that while costs had come down considerably over the last few years, the current investment tax credit being reduced from 30% to 10% over the next two years would have more of an impact than changing technologies on solar panels. Mr. Weir further noted that some companies were just now getting involved in recycling of solar panels. Discussion ensued regarding the options to pay the City for use of their rooftops or solar installations and how that was valued annually; the recycling of components of the solar arrays; how and where solar arrays are connected to the rooftop without penetrating the roofs and balanced by weights, typically around the perimeter of the solar system; micro wiring for higher voltage based on 2014 Page 3 of 11