Fact Sheet/Update November 2018
The Grand Rapids Public Utilities Commission (GRPUC)is working with the Itasca Clean Energy Team (ICET) on a proposal to develop a Community Solar Garden (CSG). Community solar is becoming increasingly popular because it takes a lot of worry out of “going solar.” Subscribers don’t need a south-facing property or an adequate rooftop; they may even be renters. There is no worry about building permits, inspections, maintenance, or tax forms, and they can transfer their program membership to another address if they move, or withdraw from the program altogether. And there is a lot to be proud of, as each share in a community solar project is a long-term source of locally produced clean energy.
Last summer the GRPUC contracted with Cliburn and Associates, a widely respected solar consulting firm, to design a potential community solar program for their customers. They recently reviewed the consultant’s final program design recommendations and have decided to adopt them as criteria for a local CSG program. A key element of these criteria is the inclusion of energy storage as part of the project. Two large solar-charged batteries would run during periods of highest energy use city-wide, every month. That way, the utility could avoid the high cost of energy during those “peak hours,” and pass the savings along to the community at large. This approach is fairly new, but has been proven successful for a growing number of utilities.
Subscribers to this solar plus battery project would also be invited to sign up for GRPU’s existing load management programs, such as air conditioner cycling or electric water heater load control. Thanks to new electronic meters, the utility can send a signal to cycle this equipment during peak times in a way that will not affect customers’ comfort or convenience, yet could extend the peak load reduction value of the overall program. Other aspects of the program would promote energy efficiency, so that community solar can become the centerpiece of an updated customer-service plan.
The solar array and batteries would be located on about eight acres of city-owned land along Airport Road. (Federal regulations do not allow commercial or residential development on the site due to its proximity to one of the airport runways.) The site would be developed as a bee-friendly “pollinator garden”. Opportunities to work directly with schools would be explored, and the project would include an online portal, with easy-to-read, real-time information about the solar array’s performance. The planning team is also working with local partners to find ways to make solar power available to lower-income customers.
“Solar Plus” Offer
This proposed program is for homeowners and renters, young and old; supportive local government and school facilities; small businesses—and in short, any GRPU customers who choose to subscribe. Solar Plus is designed so it will be a good deal for participants, while not shifting costs onto utility ratepayers who choose not to participate. To help make clean solar power more affordable, this program is designed with a “pay as you go” pricing plan. This approach offers subscribers the chance to sign up for blocks of solar generation, delivered to the local grid from this project. Assuming the project moves forward, a rate per kilowatt-hour ($/kWh) to subscribe to the Solar Plus project would be finalized, once developer bids are reviewed. Cliburn and Associates’ economic analysis suggests that the new solar rate would add about one cent per kilowatt hour (kWh) on top of the applicable customer rate.
Sample Rate (Estimated)*
Current Estimated (Blended) GRPU Residential Electricity Rate: $0.096/kWh
New GRPUC Solar Plus Rate—Applies to Solar Portion of the Bill: $0.106/kWh
Solar Premium: 1¢ per kWh on Solar Portion of the Bill
* Note that subscribers will continue to pay GRPU service fees, taxes and the standard cost per kWh for electricity use that is not covered by their Solar Plus Share/s.
For subscription purposes, the Solar Plus rate would be expressed as participant Shares. For example, the solar generation from a 1-kilowatt Share of the project would be 130 kWh/month on average. If billed on the sample Solar Plus Rate, the first-year cost of this Share would be $1.30 more per month than the cost for standard electricity. Households wishing to solarize a greater percentage of their electric bill could simply subscribe to multiple Solar Plus Shares, resulting in greater total benefits in time. The average GRPU residential customer uses about 650 kWh of electricity per month. Converting all of that to renewable solar power would require 5 Solar Plus Shares, and the solar premium would be $6.50/month. Based on these numbers, each Solar Plus Share would provide about 20% of the average household’s electricity needs.
The technologies and the financing agreement for this solar plus battery project would be long-term. However, community-wide savings begin to accrue in Year 1. While this program would offer a range of benefits specifically for subscribers, the majority of its local, clean energy benefits would be shared with GRPU ratepayers as a whole. Cliburn and Associates’ analysis shows that, over the 25-year life of the solar-plus-storage project, the utility could save much more on energy and peak-demand charges than the total project is expected to cost, with savings adding up year after year, to $4,000,000 or more.
For subscribers, the Solar Plus rate ($/kWh) would be slightly more expensive than standard electricity at first. But the Solar Plus rate will be fixed, while due to inflation and market pressures, the standard rate is likely to rise. Within 6 to 8 years, the Solar Plus rate is likely to be lower than the standard rate, and Solar Plus savings would begin to add up.
GRPU would review the program in Year 10, to ensure that ongoing costs are covered. Projections show that the program would provide savings for another 10 years or more. Thus, this program would help keep GRPUC financially strong—and more able to modernize service community-wide for years to come.
Next Steps & Approximate Timeline
January-February 2019: GRPU staff and Consultant prepare Request For Proposals (contract specifications) and bidder list
March 2019: GRPU Commission reviews RFP and affirms publishing it for bidding
April 2019: RFP responses due from bidders
May 2019: Finalists selected and interviewed
June 2019: Winning bidder selected; GRPUC affirms awarding contract
July 2019: Subscription marketing begins
August 2019: Construction begins
January 2020: Program start
This project is supported in part by a grant from the University of Minnesota Extension Regional Sustainable Development Partnership (RSDP)