The DeKalb County Board of Education voted 3-2 Thursday night to sign a letter of intent to partner with a Nashville firm to explore the use of solar energy at local schools.
Jon Sturgeon of Energy Architects presented the proposal to the board, saying that the letter of intent would be a non-binding agreement that gives Energy Architects the freedom to seek investors for the project.
“This will allow you to share your electric bills, for us to work in your behalf at no cost to you, to go to each building to do site drawings where the solar panels would fit on the buildings, to submit those into your local utility, to work with your local utility, and then to submit them to TVA for approval of the project,” Sturgeon said.
“The letter of intent allows us to have time to put this whole project together for you. Once we've done all the analysis, we've got the funding group, and we've got the document before you, then we'll bring something and you'll look at it and decide if you want to do it.”
While board members Kenny Rhody, Charles Robinson, and Johnny Lattimore voted to sign the letter, Billy Miller and Doug Stephens cast votes in opposition, both stating that while they had no problem with the basic idea of the project, they were concerned about language in the letter that prevents the board from negotiating similar projects with other companies.
W.J. (Dub) Evins, III and John David Foutch were not present at the meeting.
If the plan comes to fruition, the school system would partner with the Tennessee Valley Authority through the TVA Green Power Providers Program.
Solar panels would be installed on the rooftops of as many as six school buildings at no cost to the school system, as funding would come from third-party investors.
The energy would go to the power grid and TVA would pay the school system a premium for the electricity produced by the panels.
“We install it, we operate it, we maintain it,” Sturgeon told the board. “Typically, it's a 20-year agreement that we do. At the end of 20 years you own it. The largest system that can be deployed in Tennessee is a 50-kilowatt system. Our model is to build, manage, and operate these systems.
“We essentially build these systems and work with municipalities and school districts to put them on their rooftops at no cost to the municipality or school district,” he said.
“Our investors pay 100 percent of the capital to build and maintain these programs. We put together a commercial entity who can take advantage of the tax credits that you can't take advantage of.
“We have to go out in the investment community and find investors that are interested in a project like this. There's an audience of investors who are interested in embracing clean energy,” Sturgeon continued.
“They also realize that because solar has no moving parts, it's a very stable kind of energy-production facility. These tend to be investors who are not really after Wall Street returns. There's no wild returns on this. But there is really good high single digit steady returns for 20 years. That's hard to find nowadays. This isn't the stock market. Its physics, electricity, and TVA paying you for the power production.
“In this case, we believe you would have six buildings that would qualify so we're probably talking about $1 million of investment that the investors would put into this,” he noted.
“TVA will only send the electric credits to the building owner or the person who has a meter. We can't install more solar on your building than that meter is billed each month. A 50-kilowatt system is about 200 solar panels and that would roughly offset about $1,200 per month in electrical costs. Right now you get a bill from your utilities, Smithville Electric and Middle Tennessee Electric.
“What would happen, each month you would get a bill that shows the number of kilowatt hours used times 10 cents per kilowatt hour and there's your total,” Sturgeon added. “In this program, on your bill you'll have a second line and it will say ‘TVA Green Power Providers,’ the number of kilowatt hours the solar arrays generated into the grid at 19 cents per kilowatt hour. So they're going to pay you a premium for the first 10 years of almost double retail. Once the system is installed and energized you'll get $1,000 from TVA for each of the six buildings but the recurring revenue over and above the cost of the payment for the system, which would be your revenue, would probably work out to be about $58,000 per building or $348,000 in revenue over 20 years,” Sturgeon concluded.