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San Ramon Valley Unified School District installs 10k photovoltaic panels at five schools

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 schools.

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 photovoltaic panels.

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 year."

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. 



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RE: Bad economic analysis once more
By Solandri on 9/19/2011 8:56:28 AM , Rating: 3
quote:
*Math: ($25,000,000 / ((365.25 days * 24 hours/1000W) * 3,000,000 nameplate capacity * 0.2 efficiency)

You left off the number of years the $25M investment will be in use.

$25,000,000 / ((30 years * 365.25 days * 24 hours/1000W) * 3,000,000 W peak * 0.2 capacity factor)
= $0.158 / kWh

Which may actually be competitive with peak electric rates during the hours schools are in session.

Also, it sounds like the money for this is coming from a federal loan, so from California's perspective it's borrowing someone else's money to shift some of their current budget expenses into the future. Even if it lost them money overall, it may be deemed a necessary step to survive their current budget shortfall (from the Calif. government's perspective of course).


RE: Bad economic analysis once more
By casteve on 9/19/2011 11:04:25 AM , Rating: 3
Two additional factors may come into play. PG&E has a tiered rate structure (use more/pay more per kW-H) and the school district can move to time-of-day metering.

On the residential side, if you are a low usage customer, your rates are in the $0.12-0.14/kW-H range. Use more, and it quickly goes to $0.25/kW-H and up. The primary benefit/payback for solar here is to reduce your demand down to the lower tier levels - not to get to 100% coverage.

Time-of-day metering changes the rate based on demand. Higher during the day, lower at night. Peak demand occurs between 3pm and 7pm. Combine this with a school's solar installation. School's power use is greatly diminished after 3pm. They'll be selling power back to the utility during this period and the weekend.

So, the 16 year payback is practical. Seems in line with all of the other estimates I've seen locally.


RE: Bad economic analysis once more
By Keeir on 9/19/2011 12:36:34 PM , Rating: 2
That's a little best case senario.

Currently, the US struggles to get .2+ capacity factor in the best of locations. I am not sure what type of cell/installation they are using, but its unlikely they are using tracking concentrators. Most likely is flat plat roof top, hopefully pointed south and tilted at a good angle. In this situation 0.15 is a better capacity measurement and still optomistic over a 25+ year time frame. I also think your being optomistic about 30 years. It is very unlikely the cells have a proven track record extending that long.... unless they are using much older cells.

Assuming a low 4.0 interest rate and a 25 year term, Loan Costs --> ~121,400 per month + 8,600 additional maintaince = ~ 130,000 per month to generate ~325,000 kWh... this is roughly 0.40 cents per kWh. Which over 25 years will start to be a bargin in California.

But the point is for the forseable future (next 5 years), this is not going to lower the schools outlet. It is likely to -raise- the energy costs associated with the schools in question.

Now if the school has a 0 percent loan or a number of years before first payment, incurs no significant maintaince costs, is paying peak residental rates, got better capacity factor than custom designed large installations, and got full price for electricity sold back to the grid during days in the summer when building might be under utilized. A second option is they are getting a large payment in excess of the actual costs. I certainly hope this is not the case.

Then I agree, it may be school will lower thier energy costs this year. I just doubt that all those conditions are met.


By Solandri on 9/19/2011 2:44:59 PM , Rating: 2
quote:
Currently, the US struggles to get .2+ capacity factor in the best of locations. I am not sure what type of cell/installation they are using, but its unlikely they are using tracking concentrators. Most likely is flat plat roof top, hopefully pointed south and tilted at a good angle. In this situation 0.15 is a better capacity measurement and still optomistic over a 25+ year time frame.

A 0.15 capacity factor is a good average for the U.S. overall. 0.18-0.19 capacity factor is typical in the California/Nevada/Arizona area. 0.2 was close enough to that, I wasn't going to argue with it.


RE: Bad economic analysis once more
By sleepeeg3 on 9/19/2011 8:11:26 PM , Rating: 1
So I post actual numbers from the quoted specs and costs and people make up your own. Not sure how that works...

Panel lifetime is 25 years, according to SunPower. Cost works out to be $0.19 / kWh. Then when you factor in these are only powering 2/3 of the electric power for the school, actual costs is $0.285kWh. That's not even including efficiency loss and interest payments! These will never break even with current technology and are over 2.4x more expensive.

As I said in an earlier post, California is not paying for them. You are right about that. All of America is paying for this waste.


By sleepeeg3 on 9/19/2011 8:22:01 PM , Rating: 2
My bad to those that were agreeing. Yes, capacity factor is optimistic, but adding that into the cost effectiveness equation is like beating a dead horse - solar power advocates are not winning the argument anyway. They can have there 20% efficiency claim, because it really does not change the situation - solar power is expensive.


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