2014-11-25_PWETC_Minutes - Laserfiche WebLink

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With concerns raised by Member Gjerdingen regarding building maintenance and/or expansion, Member Cihacek noted that, with a twenty year agreement for the solar installation, any substantial changes to that particular building would most likely not be anticipated until the end of that contractual agreement; with costs for moving panels and/or down time also negotiated as part of the fixed price for the twenty-year agreement period. At the request of Member Cihacek, Mr. Kampmeyer reviewed energy cost assumptions including annual inflation; but depending on how much of an increase was granted by the Public Utilities Commission (PUC) to Xcel Energy during that time. Mr. Kampmeyer noted the current dramatic drop in natural gas, and potential increases in the future as Xcel Energy was regulated to shutter coal plants and/or decommission nuclear plant and associated costs. Mr. Kampmeyer noted that Minnesota currently had low energy costs due to coal energy, and average annual increases of approximately 4.3% over the last ten years. Mr. Weir anticipated a realistic 3.5% annual increase form Xcel Energy over the next twenty years, with a 2% escalator built in. At the request of Member Cihacek, Mr. Kampmeyer confirmed that the purchase price of the system was negotiable depending on the system cost and available investors; but was typically low risk for municipal governments from their past experience in these negotiations. At the request of Chair Stenlund, Mr. Kampmeyer advised that their firm would not charge for designing the system and was part of their services provided; and was available to offer a proforma if the City chose to own the system and depending on financing through the SPPA, inflation and degradation over time of the system. Mr. Kampmeyer offered to provide information for the Commission and City to make an informed decision. At the request of Chair Stenlund, Mr. Schwartz provided suggestions for moving forward. Mr. Schwartz advised that, on a dual track, staff was seeking a recommendation from the PWETC to the City Council in preparation for their January meeting, and anticipating that work would continue at that same time if a decision was made to pursue the Made in Minnesota application due in February and allowing enough lead time to work out remaining details; as well as continuing to discuss programs for larger roof areas. Mr. Schwartz advised that staff felt applications were feasible on smaller roofs on campus to pursue other programs as well. At the request of Member Cihacek, Mr. Schwartz advised that staff did not see any need to pursue a competitive bidding process under Minnesota municipal contracting laws for smaller systems, but to simply negotiate with installers and financial partners. Page 5 of 11