NCFPD approves low-interest loan, bid authorization for solar energy facilities

The North County Fire Protection District approved a low-interest loan and the bid process to convert several NCFPD facilities to solar energy generation.

A 4-0 NCFPD board vote Dec. 10, with Paul Schaden absent, authorized staff to apply for a California Energy Commission loan charging one percent interest, authorized an $8,750 expenditure to reserve an estimated $129,174 in California Solar Initiative rebates, and authorized NCFPD staff to develop a request for proposals for the solar facilities.

“We’re real excited that we have the support of the board on this initiative. It makes not only good environmental sense but also good business sense,” said NCFPD deputy fire chief Ed Sprague. “It was a very visionary move on their part.”

In April 2013, NCFPD staff conducted a comprehensive analysis of energy consumption and costs at district facilities which included the feasibility of solar facilities at various locations. The study identified existing fire stations 1 (Ivy Street), 2 (Winterwarm), 3 (Olive Hill), and 6 (Rainbow), future Station 5 (Bonsall), and the fleet maintenance shop as viable sites for installation of photovoltaic arrays. Including the existing Station 5 which is to be replaced, NCFPD has 18 accounts with San Diego Gas & Electric.

The factors included in the feasibility and site analysis included installation design, infrastructure enhancements such as covered parking, shading issues, system efficiency, offset of current and future electric costs, rebate structures, fiscal options, the return on investment period, future net energy cost savings, and concurrent energy-efficiency enhancements.

The solar facilities at the selected sites would provide between 90 and 100 percent offset of energy consumption. NCFPD’s average monthly electricity cost at the five current sites is $3,303, which equates to $39,363 annually.

Most NCFPD facilities pay the commercial rate, which is not tiered. SDG&E’s Sept. 1 rate increase caused the NCFPD rate to rise from 16 cents to 18 cents per kilowatt hour. NCFPD expects additional SDG&E rate increases due to the decommissioning of the San Onofre Nuclear Generating Station and to future punitive damage awards involving the October 2007 fires.

The California Energy Commission offers one percent financing to cities, counties, school districts, and special districts for energy generation projects. CEC engineers will perform an independent analysis of proposed solar projects which will validate production, efficiency, and economic assumptions. The repayment term is amortized based on annual energy cost savings, and the district will be billed semi-annually. The CEC expects the NCFPD application to be funded within six to eight months.

Since the fire district is a tax-exempt agency, it is not eligible for federal tax credits or state rebates given to residential installations. The California Solar Initiative, which is administered by the California Center for Sustainable Energy, has a rebate program for governmental and other tax-exempt installations.

The rebate model has two structure methods: a performance-based incentive which is based on efficiency and paid quarterly over the first five years of system operation and an expected performance-based buy down based on system efficiency and paid upon system commissioning.

The performance-based incentive is required on installations exceeding 30 kilowatt hours, which applies to Station 1. The $8,750 rebate reservation fee reserves the rebate amount for one year and will be refunded upon system commissioning.

The project cost and rebate amount for the future Station 5 have not yet been determined, although the cost will include a carport for that station. Carports are also included in the costs of Stations 1, 2, and 3, while the fleet maintenance shop cost includes a specialized racking system for flat roofs. The estimated costs for the solar installation are $309,974 for Station 1, $88,475 for the shop, $75,054 for Station 3, $49,022 for Station 2, and $35,655 for Station 6. The rebates are expected to be $67,238 for Station 1, $22,220 for the shop, $15,055 for Station 2, $13,837 for Station 3, and $10,824 for Station 6. Those individual figures create a total gross project cost of $558,180 while the cumulative $192,174 of rebates would reduce the net cost to $429,006.

The district’s cost analysis predicts a payback period of between 10 and 11 years with cumulative cost savings of $1,240,299.83 over 30 years. “It makes real good financial sense,” Sprague said.