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Posted September 5, 2012 | 5 Comments
Group revives solar power proposal to Front Royal
By Alex Bridges -- email@example.com
FRONT ROYAL -- An Ohio-based energy supplier renewed an offer that would put Front Royal on the solar-power generation map.
American Municipal Power Inc. returned to Town Council on Tuesday with a proposal similar to one made by the nonprofit agency in 2010. The Columbus-based organization serves as a wholesale supplier of power for municipal electric systems, according to the firm's website.
Council at a work session heard from Jay S. Myers, member marketing representative for AMP. Myers told council the AMP board of trustees directed staff to pursue development of a solar array through an ownership arrangement. AMP previously looked at having Standard Energy work with the nonprofit and set up the solar array. The town had committed to participate in the previous AMP project to receive 2 megawatts of electricity and to serve as a host site, according to Town Manager Steven Burke.
However, according to Myers, Standard Energy came back to AMP and "said they couldn't honor the agreement" so the nonprofit decided to pursue the project in-house.
Town Council remains interested in serving as a host site for the project, Myers said and members agreed.
The director of the town's Department of Energy Resources plans to make a recommendation to council on Sept. 17. Burke noted that AMP may notify Front Royal in December if the organization approved its offer to serve as a host site. Myers told council AMP plans to hire a consultant to rank the potential host sites based on construction costs and other factors.
"If there is a favorable council aboard that is working to champion this that would be a plus," Myers said.
The solar-power array installations will reside behind members' meters, Myers explained. The phased project relies on Clean Renewable Energy Bonds. Per the AMP board's approval, the firm will request the transfer of some or all of the $59 million previously awarded for wind and hydroelectric power projects, according to Myers. The funding should cover the cost to install enough solar devices to generate 30 megawatts of power. Funding would limit phase I of the project to the 30 megawatts, Myers said.
Electricity generated from solar power would cost more per megawatt than other sources, according to Myers and Burke. The benefits for participation in the project would come through possibly being a host site, Burke said Wednesday.
"The benefit for any power generation within Front Royal results in no transmission costs to the town for that power," Burke said. "Right now, whenever we purchase power there's a cost to purchase it and then there's an additional cost through PJM for the transmission of power to the town."
As Myers presented, a "take-or-pay" contract would span 35 years and requires the party to pay for the service whether or not the array produces power. Myers indicated that banks put the "take-or-pay" stipulation on projects such as these to ensure the payments on the bonds issued.
A facility recently completed in Napoleon, Ohio, now produces solar power, according to Myers. Napoleon officials agreed to take the entire power output until subscribers connect, Myers explained.
"It's being sold to all members," Myers said. "Site selection and prioritization is based upon approval of the participants committee. All participants in the project receive a percentage share of energy from all the different sites."
As a host site, Front Royal could receive the added benefit of cutting down on the transmission fee. Having the solar panels behind the meters would save the user money on the transmission costs which make up a significant portion of the electricity bills, according to Myers.
Host sites would sign separate, interconnection lease agreements for land use and operations, Myers said.
"Like I said earlier, the goal is to utilize local companies where feasible, provide local jobs and stimulate the local economies," Myers told council.
Burke explained the site selection would also depend on how much electricity AMP would seek to generate at one given host site.