FARMINGTON — Regional School Unit 9 directors Tuesday evening, Feb. 11, continued consideration of contracting with a solar energy provider during a presentation with Agnieszka Dixon, attorney with Drummond Woodsum of Portland.
During the Jan. 28 meeting, Kurt Penney of ReVision Energy said the district could save thousands of dollars per year on energy if directors decided to join a solar energy aggregate at Souther Farm in Livermore Falls.
Regional School Unit 73 in Jay and Maine School Administrative District 28 in Camden were already on board with the project, he said at the time.
“What Agnieszka has prepared is a presentation so the board can understand the contract process,” Superintendent Tina Meserve said. “The actual contract will be reviewed by the board at the next meeting if you consent to have it drafted.”
Dixon said she had given similar presentations to “five or six school boards across the state.”
A new state law, known as the Net Metering Law, provides opportunities for municipalities and institutions to take advantage of energy credits by purchasing electricity from solar farms not on their property, Dixon said.
Dixon said by entering into a power purchase agreement, the district would commit to purchasing a certain percentage of electricity generated at the solar farm. These are known as credits, she said. The credits would be sold at a discounted rate and be applied to the district’s Central Maine Power bill.
“The best explanation I have heard is that it is like buying a discounted CMP gift card,” Dixon said.
The initial term of the agreement is 20 years but there is an additional five-year term that would automatically kick in unless the law is taken off the books, she said.
Before committing to the project, the board would need to review past electricity use and assess the district’s future needs.
“You are being asked to project the district electricity use for the next 25 years,” she said. “It is not an easy task but it is the first step in figuring out if a power purchase agreement is going to save you money at the end of the day. There are a bunch of variables to consider that will ultimately help you figure out if you are going to save money.”
Decreased enrollment leading to school closures can affect electricity costs, as can expansion of facilities due to increased enrollment, she said.
The cost to deliver electricity can fluctuate, she added. The delivery rate is set by the PUC and is typically adjusted annually.
“Once you have determined your projected electricity need, you want to look at the cost of purchasing power from the provider,” she said. “You need to look at the estimated total energy estimated to be produced every year. Whatever the power provider generates, you are committing to purchasing a percentage of that output at a kilowatt-hour rate,” she said.
The contract would include what is called an escalator. The percentage of electricity purchased would increase by 2% each year, Meserve said.
Solar outputs may vary from month to month and year to year, Dixon said. Since the district would be purchasing a percentage of that output, the cost could vary as well.
“I am always asked if it makes sense for a school to consider power purchase agreement since solar power production is at its peak in the summer,” she said. “It does because the law allows credits to be rolled over month to month for up to a year.”
She estimated first-year savings of nearly $150,000.
Dixon said the board could enter into an agreement without seeking districtwide approval.
“This is not a long-term debt. It is more like a lease-purchase agreement, ” she said.
Dixon assured the board the contract would have provisions for catastrophic situations leading to zero production of electricity. “That is typically a scenario where parties come back to the table and renegotiate,” she said. “They could walk away or wait until production is restored.”
Finally, she asked to board to determine why it was considering using solar power.
“We talked about financial benefits. We didn’t talk about the environmental statement and the advantages a renewable energy market provides,” she said.
Dixon will draft a contract for the board to review at its next meeting.
If the board moves forward with the proposal, savings would show up as soon as the project begins producing net energy credits which could be as early as this summer, she said.
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