Solar Energy - Otsego County  
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Below you will find a list of frequently asked questions pertaining to Solar Energy. If you have any questions you would like answered please e-mail Meghan Lottridge at lottridgem@otsegocounty.com or you may give our office a call by dialing (607) 547-4225.
 

Q.What is remote metering?

Answer: Remote metering does not require direct connection to the buildings it is servicing. With the creation of an offsite solar array, the power produced at the site is metered and sent into the grid. The total kw hrs. produced is documented and applied to the total electrical usage from the County buildings as credit based on the difference of the market rate with NYSEG and the fixed rate through Solar City. Credits are then applied to the County’s NYSEG bill for all the county buildings that participate.

Q. What is a Power Purchase Agreement (PPA)?

Answer: A PPA is when an entity ‘Host” a site and agrees to pay for the electricity produced and used. Solar City installs and maintains the solar system on the County’s site with no upfront cost or immediate payback. The county agrees to purchase the solar produced electricity from Solar City as needed at a fixed rate for 20 years.

 Q. What will the project cost Otsego County?

Answer: There are no “upfront” cost or immediate payback to the County. The County agrees to provide a site for the remote array but is not responsible for the installation and or maintenance of the site. The project is financed through private investments and NYSERDA grant funding. Solar City takes leverages government incentives and depreciation that is the County would not qualify for on their own.

Q. What would be the average utility credit to the County?

Answer: With remote-net-metering the utility credit is determined by NYSEG ultimately. Solar City anticipates a credit value of $.10-12/kWh in the first year with an annual rate escalation of approximately 2%.

Q. What would be the County net credit?

Answer: Solar City will be charging the County a fixed rate of $.069/kWh over the 20 year contract term.  The average net-credit would range from $0.031 to $0.051/kWh in the first year. The net credit would only increase every year if the utility credit value continues to escalate.

Q. How much does the County anticipate saving over the first year?

Answer: The proposed solar project is expected to produce approximately 2,821,534-kWh in the first year. This is approximately 98% of the County’s current load with the elimination of the Manor. This would translate to a full utility credit of $282,K-383K (depending on NYSEG rate for remote-net-meter) and a net credit to the County of $87K-$144K (this is after paying Solar City).

Q. What would happen if Solar City goes bankrupt or no longer exist.

Answer: Each system is owned by a special purpose entity. The special purpose entity is either (1) wholly and indirectly owned by SolarCity or (2) jointly owned by SolarCity and a tax equity investor. The special purpose entity owns many systems. The special purpose entity is structured to be bankruptcy remote from SolarCity, meaning that if SolarCity goes bankrupt, that bankruptcy will not directly cover the special purpose entity or cause it to go bankrupt. The tax equity investors get a large part of their return from the operation of the system and so are highly incentivized to make sure that the systems operate and generate income (in the form of customer payments for electricity or the rental of such systems). The special purpose entity will arrange for O&M services if SolarCity goes bankrupt and can no longer perform them because they are incentivized and contractually obligated to maintain the systems. In some cases, our tax equity investors have arranged for backup O&M services from a non-SolarCity provider so that those services can be performed if SolarCity cannot perform them due to its bankruptcy.

Q. Will Solar City sell the ownership of the project to another entity after construction is completed?

Answer:Most of the project funds are structured as partnership flips between SolarCity and the tax equity investor. These funds are structured so that the assets revert to SolarCity after tax equity investors hit their required returns; this usually occurs at some point between year 7-12 depending the returns required by the particular fund. SolarCity will then own the asset. Solar City raises debt by pledging the cash flows from our systems in the funds, via securitization and other capital markets, but we won’t sell off the asset, meaning we are aligned with the host (Otsego County) long-term since debt providers require systems to perform as modeled or we face harsh penalties.

 

Q. Will there be Solar Glare from the array that could impact surrounding properties?

Answer: Modules work by absorbing the sunlight rather than reflecting it and any glare produced by a system is unlikely.