Wholesale Renewable Energy Generation Feasibility Presented to Las Gallinas Valley Sanitary District Board June 27, 2013

Transcription

1 Wholesale Renewable Energy Generation Feasibility Presented to Las Gallinas Valley Sanitary District Board June 27, 2013 Clean Energy Solutions

2 Overview of the Feasibility Study Site Characteristics and Resources Scale of Potential Projects Ownership and Contract Options Production and Financial Analysis Conclusions and Next Steps

3 Site Characteristics and Resources District Owned Parcels Only Study area comprised of four District owned parcels Approximately 450 acres Flat, diked areas adjacent to San Pablo Bay Fields used for irrigation and storage ponds Existing 571 kw DC net-metered solar PV Nearest residential neighbors 0.2 miles to West of study area

4 Site Characteristics and Resources Renewable Resources 1. Wind Resource Less consistent and very site specific Modeled Using WAsP Marginal NREL Classification 8.93 mph average at 40m hub height 2. Solar Resource Consistent and dependable No shading issues Modeled using NREL TMY data 5.21 kwh/m2/day

5 Wind Resource Model

6 Wind Resource Model

7 Scale of Potential Generation Projects Wholesale energy projects must be scaled to provide most energy output for least installation and operational costs. Small utility scale RE facilities: Wind: HAWTs under 200 tall Solar: single-axis tracking, large scale fixed tilt

8 Scale of Potential Projects Technology Small Utility Scale Maximum Capacity Wind Solar Alternative MW DC, comprised of five 225 kw WECS Alternative MW DC, comprised of single axis tracking solar PV Alternative MW DC, comprised of ten 750 kw WECS Alternative MW DC, comprised of fixed tilt solar PV

9 Wind Project Alternatives

10 Solar Project Alternatives

11 Ownership Options District Owned/ Operated Third Party Public-Private Partnership Cash Low interest loans Bonds G.O., QECBs PPPs typically not used due to private ownership requirements for pass through of Fed tax benefits Land Lease Agreement yrs Buyout options

12 Wholesale Energy Contracts Marin Energy Authority (MEA) Feed-in Tariff (FIT) Open Season Procurement Unsolicited PPA Pacific Gas and Electric (PG&E) Renewable Market Adjusting Tariff (ReMAT) Feed-in Tariff (FIT) Renewable Auction Mechanism (RAM) Procurement Typical wholesale contract pricing: Wind~ $ $0.10/kWh Solar $ $0.14/kWh

13 MEA FIT Tiers Tier (Allotment) Solar Wind Peak Energy Prices (20-year Term, $/MWh) Intermittent Energy Prices (20-year Term, $/MWh) Condition 1 (2 MW) $ $ Condition 2 (2 MW) $ $ Condition 3 (2 MW) $ $ Condition 4 (2 MW) $ $ Condition 5 (2 MW) $ $ 80.00

14 Production and Financial Analysis Wind Solar Potential Project System Size System Type Potential Generation 1 Equivalent CA Homes Alternative 1 Small-Scale Wind Alternative 2 Max Footprint Wind Alternative 3 Small-Scale Solar Alternative 4 Max Footprint Solar MW DC 7.5 MW DC MW DC 7.5 MW DC kw DC HAWT MW DC HAWT Single-Axis Tracking Fixed Tilt 1,230 MWh/yr 8,384 MWh/yr 2,092 MWh/year 11,600 MWh/yr 175 homes/yr 1,200 homes/yr 300 homes/yr 1,650 homes/yr MEA PPA Energy Purchase Price $100.57/MWh 2 $75/MWh 3 $137.66/MWh 2 $100/MWh 3

15 Production and Financial Analysis District Owned 20-year Project Costs/Returns Potential Project Alternative 1 Small-Scale Wind Wind Alternative 2 Max Footprint Wind Alternative 3 Small-Scale Solar Solar Alternative 4 Max Footprint Solar LGVSD Project Cost $3.8MM $21.2MM $3.7MM $15.6MM LGVSD Income $2.5MM $13.4MM $5.5MM $22.2MM LGVSD O&M Expense $800,000 $3.2MM $906,000 $3.5 MM LGVSD NOI $1.7MM $10.2MM $4.6MM $18.7MM Cumulative Cash Flow -$2.1MM -$11.8MM $911,000 $3.0MM Simple Payback Year Does not pay back Does not pay back 15.7 years 16.4 years NPV, 2.5% Disc. Rate -$2.4MM -$13.6MM -$68,000 -$910,000

16 Production and Financial Analysis District Owned Wind 20-year Project Costs/Returns to District

17 Production and Financial Analysis District Owned Solar 20-year Project Costs/Returns to District

18 Production and Financial Analysis Third Party Owned 20-year Project Costs/Returns to District Potential Project Alternative 1 Small-Scale Wind Wind Alternative 2 Max Footprint Wind Alternative 3 Small-Scale Solar Solar Alternative 4 Max Footprint Solar LGVSD Project Cost N/A 1 N/A 1 $101,000 2 $249,000 2 LGVSD Revenue " " $306,000 $1,277,000 LGVSD O&M Expense " " $0 $0 LGVSD NOI " " $306,000 $1,277,000 Cumulative Cash Flow " " $205,000 $1,028,000 Simple Payback Year " " 8.6 years 12.4 years NPV, 2.5% Disc. Rate " " $121,000 $405,000

19 Production and Financial Analysis Third Party Owned 20-year Project Costs/Returns to District

20 Conclusions The District has enough useable land available to install up to 8 MW of renewable energy generation capacity. Based on the modeled wind resource, there is not enough wind to support a wholesale wind energy project Estimated 14 mph at 40m average wind speed needed for wholesale contract to be profitable Modeled 8.9 mph at 40m average at study site A wholesale solar project is financially viable 1 MW MEA FIT provided the greatest returns

21 Next Steps Wholesale Energy Project Determine if project economics are viable and type of project to pursue. Determine preferred funding mechanism Phase 1 Pre Project Investment grade feasibility study Detailed project modeling Pre-application interconnection with electric utility Meetings with MEA for contract terms Phase 2 Permitting and Contracts Incentive and interconnect applications CEQA, Permitting, Public Relations Secure financing and FIT agreements RFP and Vendor Selection Phase 3- Design and Construction Phase 4 Operations and Maintenance Phase 5 - Decommissioning

22 Next Steps Demonstration Net-metered Energy Project Determine if project economics are viable and type of project to pursue. Assess residual energy costs now that the new plant is online Determine scale and type of project to pursue If wind project: install anemometer and data logger to gather site wind data in conjunction with project. Determine preferred funding mechanism Permitting and Contracts Incentive applications CEQA, Permitting, Public Relations RFP and Vendor Selection Contract negotiations Design and Construction Operations and Maintenance Decommissioning

23 Sage Renewable Energy Consulting INVERNESS BELMONT Clean Energy Solutions

24 Wind Project Alternatives

25 Wind Project Alternatives

26 Project Considerations County Permitting Utility Wind Project Compliance with or variance to WECS development standards Complete CEQA finding Building Permit Application Site plans WECS elevations WECS noise specifications Tower drawings and engineering analysis Single line electrical drawing Electric Utility notification and agreement Wind measurement study Bird and bat study Visual simulations Project-specific acoustical analysis Post approval requirements Post construction avian and bat monitoring program WECS Decommissioning and Reclamation Plan

27 Project Considerations County Permitting Utility Solar Project Compliance with County development standards Complete CEQA finding Building Permit Application Fire Authorization Letter Site plans Solar system elevations Building plans Single line electrical drawings Hazard Signage plans Operations and maintenance manuals/specifications Post approval requirements Electric Utility notification and agreement Decommissioning and Reclamation Plan

28 Project Considerations Community and Environmental Visual Impacts Make visual simulations available to public Noise Impacts Cannot exceed 55 dba at property line of residence Acoustical study prior to permit Wildlife Impacts Bird and Bat Study required prior to permit Public Relations Transparent and early communication with all stakeholders Decommissioning Have a plan and financing set aside for end of project

29 Wholesale Generation

30 RE Technologies Wind Systems Two Basic Turbine Designs Vertical Axis Wind Turbine (VAWT) Easier to Maintain Quieter Need Higher Wind Speed to Start Horizontal Axis Wind Turbine (HAWT) Commercially Viable More Efficient Harder to Maintain

31 Wholesale Generation Steps to Implement 1. Feasibility Study 2. Investment Grade Study 3. Planning, Permitting & Interconnection 4. Secure Interconnect Agreement, FIT, Permits & Financing 5. RFP & Vendor Selection 6. Construction & Commissioning 7. Project Operation