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Jason Willett

MCES Assistant General Manager, Finance & Sustainability and Director of Council Sustainability

P: 651.602.1196

Presented to APWA, August 29, 2016

Solar Collaboration Among Local Governments

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• Metropolitan Council overview

• Solar overview

• Metropolitan Council solar projects

• Collaborations

• Other useful information/resources

Presentation Overview

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About Metropolitan Council

• Metro Transit (Buses and LRT)

• Metro Mobility

• Metro Transportation Planning

• MCES (Environmental Services)

• Local government planning coordination

• Regional parks funding

• Housing

• Efficient delivery of metro-scale services!

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• Wastewater treatment

– 8 treatment plants

– 109 communities

• 370 million gallons/day wastewater capacity

• 250 mgd average flow

– 600 miles of pipes

• 61 lift stations

• 206 metering sites

• Water supply planning

• Water quality monitoring

• Industrial pollution prevention

About MCES

Metropolitan Wastewater Treatment Plant, St. Paul

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Video – About Environmental Services

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• To be a valued leader and partner in water sustainability

• Goals to reduced purchases of fossil fuel based energy:

– By 2010, reduce by 15% of 2006 usage.

– By 2015, reduce by 25% of 2006 usage.

– By 2020, reduce by 10% of 2015 usage.

• Goal to advance renewable energy development in the state.

MCES Vision & Energy Goals

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Solar Radiance Map of the United States

Clean Power: http://www.cleanpower.com/2013/pv-power-maps-visualizing-monthly-production/

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10. Avoids greenhouse gas emissions;

9. Avoids other air emissions;

8. Avoids thermal pollution of cooling waters from nuclear or fossil fuel generation plants;

Top 10 Reasons the Government Pursues Solar

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7. Avoids using up resources that future generations may need for other things;

6. Avoids a piece of the $18 billion Minnesota spends out of state each year for energy;

5. Provides local jobs;

Top 10 Reasons the Government Pursues Solar

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4. Distributed energy improves grid reliability;

3. Supports state and Council renewable and solar goals;

2. Provides price certainty for our operations and rate/taxpayers;

Top 10 Reasons the Government Pursues Solar

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AND....

It can provide financial gains for rate/taxpayers!

Top 10 Reasons the Government Pursues Solar

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Facility (or Building) Connected Solar

Installed/Operational

• MCES about 1.25 MW

• Transit about 100 KW (AC)

Planned

• Transit about 4 MW

• MCES 350 KW (AC)

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Use of Marginal Land for Solar

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Community Solar Garden Program

Each subscriber’s utility bill is credited money from the electricity created by their share of the solar garden.

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• Blue Lake Plant

– 3 gardens (each 1MW)

• Empire Plant

– 5 gardens (each 1MW)

• Seneca Plant (Eagan)

– 1 garden (900kw)

All subscribed to by: MCES, Metro Transit and local governments served by the plants.

Community Solar Gardens on Council Property

Local Government Roles:• Host for sites• Subscriber• Procurement

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Local Government Subscriber Collaborative

• 31 participating governments/subscribers

• 185 MW estimated demand

• Transit 4 MW; MCES 6 MW

• Competitive procurement process

– Received 5 proposals

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Steps for Participating

• Subscribe to at least 100KW

• Letter of Intent

• Joint Powers Agreement (JPA)

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Competitive Procurement Process

1. Request for proposals from developers asked for:– Executive summary– Team information, qualifications, experience and capabilities– Technical review– Price proposal– Exceptions to requested subscriber agreement

2. Team Evaluation Panel– Quality of Proposal– Qualifications and experience– Acceptance of agreement?– PRICE

3. Contract negotiations

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Subscriber Assignment Process

• Eligibility determination• Lottery used to match

governments demand to solar supply offered.

• Limited days to opt in• 2nd “lottery” to fill holes• Developer may fill any partially

subscribed garden.

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• Economy of scale

• Speed increased

• Market leverage

• Diversity of skill sets = improved quality

• Staff learning from each other

“We wouldn’t have been able to do this without the Metropolitan Council” - Mayor

Benefits of Working Together(ie. why do this?)

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Complexities and Challenges with Government Solar

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• Technical experience

• Use of disadvantaged business

• Prevailing wages

• Local manufacturers

• Sole source

Issues/Concerns/Perspective:

Procurement Issues

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• Governmental laws

• Assignments

• Deadlines

• Renewable Energy Credits (RECs)

• Options/early termination

Issues/Concerns/Perspective:

Contract Terms

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• Site control

• Point of common coupling

• Internal specs

• Safety/security requirements

Issues/Concerns/Perspective:

Technical

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• Long term availability

• Marginal land use

• Local zoning approvals/limitations

• Co-benefits – e.g. pollinators, trails

• Stormwater standards/maintenance/upkeep of site

Issues/Concerns/Perspective:

Siting issues

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• Pay-as-you-go (per kWh)

• Financial capacity demonstration

• Lender requirements

• Bill credit risk

• Guaranteed performance (our upfront costs, and opportunity cost)

• Impacts on our tariff energy purchases (demand, standby)

• Public-private partnerships are complex up front!

Issues/Concerns/Perspective:

Financial

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Collaborations

• Environmental Quality Board – Climate Strategies and

Economic Opportunities (CSEO) project

• Clean Air Minnesota

• The Climate Registry

• Xcel Energy

• Minnesota Sustainable Growth Coalition

• Metropolitan Energy Coalition

• State Interagency Teams

• University of Minnesota

• Solar Rate Reform Group

• e21

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• Xcel Energy studied electric system capacity benefits of solar

• The Solar Rate Reform Group (SRRG) formed

• Decision:

– Capacity credit $5.15 per KW/month

– Flexibility of grace period

• New (2016) docket: change to kWh basics

Solar Rate Reform Group

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e21 Initiative“The Utility of the Future”

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2013 “Disruptive Challenges” Report

Graphic courtesy of:Report: http://www.eei.org/ourissues/finance/documents/disruptivechallenges.pdf

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Phase I report issued in December 2014

e21 proposes shifting toward a

performance-based, multi-year utility

earnings model & regulatory framework.

Report: http://www.betterenergy.org/sites/www.betterenergy.org/files/e21_Initiative_Phase_I_Report_2014.pdf

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TODAY: Utilities earn money by. . .

Building fixed assets Selling more electricity (kWh)

The “Build More, Sell More Model”

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TOMORROW: Utilities make money by delivering...

Reward the delivery of VALUE more than CAPITAL INVESTMENT

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What does a Grand Bargain look like?

1. EFFICIENCY: Highly efficient end use of energy in buildings, transportation, and industry.

2. DECARBONIZATION OF ELECTRICITY and reduced carbon in other kinds of fuels.

3. ELECTRIFICATION WHERE POSSIBLE and switching to lower-carbon fuels otherwise.

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Other Useful Information• Supporting local governments

• Government policy• Resources

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Supporting Local Units of

GovernmentStormwater, Efficiency &

I/I Grants

Urban Forestry Program

Development

Community-Level Data

for the Region

Climate Vulnerability Assessment

Technical Assistance

to Local Gov’ts

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Governmental Policy SupportFor Sustainability Projects

Traditional Financial Criteria

Societal

Environmental

CostsTriple Bottom Line

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Lifecycle Net Present Value

Environmental

Lifecycle Expected Net Present Value

Costs

Environmental

Environmental

Societal

Financial Criteria

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Environmental

Societal

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http://www.mepcsolartoolkit.org/

ResourcesMetropolitan Energy Coalition Solar Toolkit

Highlights:• Typical solar cost• Evaluating a site• How to install• Understanding project costs• Solar policy in Minnesota

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ResourcesMet. Council’s “Local Planning Handbook”

• Helps communities update their local comprehensive plans.

Highlights:

• Community pages with checklists

• Maps

• Resources specific to them

• Interactive mapping tools

http://metrocouncil.org/Handbook.aspx

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ResourcesClean Energy Resource Teams (CERTS)

http://www.cleanenergyresourceteams.org/solargardens

• Community Solar Garden toolkit (great for beginners)

Highlights:• How much solar should I get?• Definition of Community Solar• Interviews with subscribers• Range of players in a project• Resources for subscribers and

communities

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ResourcesMetroCouncil.org

http://metrocouncil.org/Wastewater-Water/Projects/Energy-Conservation-Renewable-Energy.aspx

• Energy and sustainability fact sheets

• Our energy goals• Plant facts• Awards information

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The End

Questions?