SOLAR PV PROJECT

REDDING AIRPORTRod Dinger, A.A.E

Support Services Director/Airport Manager

Barry DeWaltAssistant City Attorney

City of Redding

POWER PURCHASE AGREEMENT (PPA) FIRMS CONTACT AIRPORT

• Two interested PPA Firms competing. DRI and SPG contacted us independently around August 2010.• Turn Key Operation to supply electricity for the

Passenger Terminal Building and Airfield Lights….1.1 million kWh annually.• Revenue Return - DRI offered $654,000 and

SPG offer$620,000 over 20 years….not too bad. • The offers were basically to sell us back the

electricity about $0.01 per kWh under what we were currently paying.

WHY THE SUDDEN PPA INTEREST?

• Historical usage and meter set-up was attractive.

• City of Redding Electric Utility was offering $0.35 per kWh rebate for solar projects within the City limits. The largest per kWh rebate in the State of California at the time.

• American Recovery and Reinvestment Act (ARRA) eligible for renewable energy projects.

WHY NOT GO WITH A PPA?

• Neither PPA firm was willing to share their investment costs or their expected revenue return.

• Negotiating challenges.

• Time was of the essence…REU rebate was to expire at end of FY and at the time, ARRA funded was not extended beyond 12/2010.

LOOKING AT POSSIBLE SITESCHOICES…CHOICES…

EUREKA MOMENT!

• As we were running out of time…we were sitting in my office and I asked… ”why don’t we try to do this ourselves? “

• We invited in a local experienced solar contractor that had a great local reputation. They just completed a project at local high school and were working on a project at a local middle school. They freely provided estimated costs.

• We learned the overall project cost was in the $4.1 million range.

• REU Rebate and ARRA funding was estimated to be in the $3.1 million range. REU - $2.0 million and ARRA - $1.1 million.

EXPECTED RETURN

• Projected revenue was about 3.6 million over 25 years verses 654,000 with a PPA over 20 years.

• The project is cash neutral for the first 7 – 8 years, then the savings kick-in.

• The Airport will remain financially self-sufficient.

• Sustainable energy source, reducing carbon emissions by 22,970 tons over 25 years.

NOW WHAT…

• Need to sell the City Manager and City Council on the concept and risk.

• Final Site Selection.• Sole Source Construction Contract. Due to time

constraints… we asked Redding City Council to waive the bidding process and let us sole source with Halcyon and Belvedere Equipment Financing.

• FAA Review (Airport Layout Plan and Air Space Review).

• ARRA Money. • Qualify for the Redding Electric Utility Rebate.• Business Interruption Insurance.

CONSTRUCTION BEGINS

REDDING MAYOR SYMBOLICALLY “TURNING ON THE SWITCH” – MAY

2011

LET THE ELECTRICITY FLOW!

PV SYSTEM SPECIFICATIONS

• 602 kW – Passenger Terminal Building.• 93 kW – Runway and Taxiway Lighting.• 3 acre site.• 3,504 (3’x5’) panels.• 3 inverters.• Internet Based Monitoring System.• PV Modules expected to last 25 years… 0.05%

annual loss.• Designed to offset 98% of the terminal and

airfield lighting.• Airport to receive $0.1370 per kWh for electricity

generated beyond actual usage.

THANK YOU!