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Fresh Energy's 2013 Power Breakfast | Jason Willett: Case Study


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The first event of a three-part Solar Opportunities Series, Fresh Energy’s annual Power Breakfast outlined new and exciting solar opportunities for business and property owners. Learn more at

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Fresh Energy's 2013 Power Breakfast | Jason Willett: Case Study

  1. 1. Metropolitan Council Environmental Services (MCES) Solar Project at Blue Lake Wastewater Treatment Plant Fresh Energy; 2013 Power Breakfast September 24, 2013 Jason Willett, Director MCES Finance & Energy
  2. 2. • A regional governing body of 16 Metropolitan Council Members and Chair Susan Haigh • Operates Metro Transit, which carried 81 million bus & rail passengers in 2012 • Operates MCES, which collects & treats wastewater at rates 40% lower than peer regions • Partners with communities & the public in planning future growth • Provides affordable housing opportunities for low- and moderate- income residents Metropolitan Council
  3. 3. MCES Wastewater System  Seven Treatment Plants  600 miles of Regional Interceptors  Estimated $5 Billion Replacement Value  Capacity to treat 372 million gallons per day of Wastewater Flow  107 Communities Connected
  4. 4. MCES Metropolitan Plant
  5. 5. MCES Performance Awards • National Association of Clean Water Agencies (NACWA) – compliance with clean water discharge permits • All plants, most years • MCES/Xcel Energy Awards • 2009, 2010, 2012 Efficiency Partner Award • 2011 Gold Award • NACWA Operations Award for Environmental Achievement (Inflow/Infiltration program) • Metropolitan Plant Solids Management Building design • 2012 Governor’s Continuous Improvement Award for the Council’s energy saving initiative
  6. 6. • Reduces costs for wastewater rate payers • Reduces exposure to rising energy costs • Improves our position for emissions regulations • Offers external societal & environmental benefits (e.g. jobs & pollution reduction) MCES Interests in Energy Work
  7. 7. • Energy: Creates clean, renewable energy • Energy: At site energy use eliminates utility line losses • Capacity: Operates efficiently when utility grid has most demand  less need for other generation • Capacity: Reduces need for utility reserves • Environmental: No carbon or other air emissions • Environmental: Uses little to no water • Societal: Supports energy independence & security • Societal: Creates jobs • Societal: No use of limited fuel resources Societal Benefits of Solar
  8. 8. • Lower life cycle cost (benefiting wastewater ratepayers)! • Supports MCES Mission • Provides beneficial use of buffer land around plant • Provides price stability of some energy costs • Reduced carbon emissions may save future costs • Provides future opportunity to leverage facility • Learning for MCES staff • Visibility to encourage others Benefits of Solar to the Council
  9. 9. Solar – Early Barriers • High capital cost of solar panels • Low electric rates meant avoided costs were low • Federal tax incentives not available to government agencies. • Limited staff experience  conservative assumptions. -------------------------------------------------------------------- • Approaches tried: – Traditional procurement/financing – State bonding – Public Facilities Authority’s “Green Reserve” – Wind source proposal to Xcel
  10. 10. • Panel prices have dropped by 75% • Electric rates and avoided costs have escalated • New solar standby capacity credit was implemented • New solar mandate, creating value for solar renewable energy credits • Council passed a new sustainability policy expanding the definition of economic feasibility ----------------------------------------------------------------- • Approach utilizes a competitively-selected 3rd party and PPA helps procure Federal Solar Tax benefits and Renewable Development Fund Grant Solar – Now
  11. 11. Blue Lake Solar PV System • 1.25 MW (ac) • 5 to 10 acres • Fixed panel system • No Council capital; and little risk • Oak Leaf LLC (private) takes construction, permitting, connection, technology, and production risks Minnesota River Highway 101, Shakopee, MN New Anaerobic Digesters Future Solar Facility
  12. 12. • Production • Avoided energy prices, including fuel • Capacity Credits • Value of Solar Tariff design • Renewal Energy Credits (RECs) Significant Uncertainties
  13. 13. Lessons Learned • Engineering Assistance – Electrical distribution & interconnect Specs – Permitting • Financial Assistance – Firm vs. Interruptible Load – On Peak vs. Off Peak load (impacts avoided costs) – VOST, net metering, behind-the-meter • Management Support – Future Uses of Land – Procurement decisions (Wages, MBE/WBE, local content) – Political Support
  14. 14. Financial Analysis Approach
  15. 15. Council’s Sustainable Policy Elements: • Energy and Emissions • Water • Fleet • Solid and Hazardous Waste Economic Feasibility • Expected present value payback over life cycle!
  16. 16. Questions?