In a move that is proving to be controversial with some,
some California school districts are looking to a high-tech
way to save money, even if the payback won't be achieved until well over a
decade later. CNN is reporting that some California school
districts are looking to low-interest federal loans to install solar panels on
CNN singled out
the San Ramon Valley Unified School District, which has installed roughly
10,000 photovoltaic panels at five of its 35 total schools at a cost of $23
million. Under the most optimistic projections, the photovoltaic panels would
offset energy usage at the schools by 67 to 75 percent.
According to spokesman Terry Koehne, the San Ramon Valley
Unified School District will pay back the loans courtesy of the energy savings
from using the solar installations. However, this won't be a quick payback for
the school system -- it will take roughly 16 years to break even on the
Koehne, however, points to the upside of embarking on this
expensive venture; "It's pure profit after that. And following that, we're
going to start realizing savings of $2 (million), $3 (million), $4 million a
Like many schools across the nation, California schools are
facing a serious budget crunch. Less money means fewer teachers, fewer teaching
assistants, and more students per classroom. By making this move now, the
school district is hoping that the future payoff will allow it use its
resources more wisely.
Lower production costs, thanks to stiff
competition from Chinese companies, is causing a surge in the adoption of
solar panels. One of the causalities
of the race to the bottom in panel costs was Silicon Valley-based Solyndra.
The company received a rushed $535 million loan courtesy of the Obama industry
during 2009 in order to bolster its operations.
However, the company two years later filed for bankruptcy
and axed over 1,000 employees. Interestingly, an email that was sent out before
final approval of the loan was granted rightly projected that the company would
run out of money by September 2011.
quote: So really this is better viewed as an investment rather than a simple expenditure. An investment that doubles in value after 16 years. Now that's not great (it's about a 5% annual return), but it's good enough to stay ahead of inflation and less risky than investing in stocks (and what business would a school have investing in stocks anyways?), and certainly better than what you would get with bonds or as interest from any major bank right now.