Charter Focus - Fall 2013 - page 5

5
Charter Focus | Fall 2013
T
he Pinnacle School
Board immediately
liked the idea, but, as with all ideas,
there comes a lot of research, analysis,
and work to make it a reality. After
months of screening providers,
researching the industry, analyzing
financials, and negotiating contracts,
The Pinnacle installed a full array
of solar panels on two of its three
buildings in April, 2013. This article
will summarize the process and
highlight the critical watch points for
those who are considering a similar
venture.
THE PRESENTATION:
As with all large endeavors a school
will consider, the first step is to find
several providers to present their ideas
and proposals. This is a critical watch
point. You want to make sure to
carefully consider each proposal, check
the background of the providers, and
make sure you and your board feel
comfortable with establishing a long-
term relationship with whomever you
choose. Some important questions to
ask and look for are:
How long has the provider been
in the solar business
What is the historical financial
performance of the provider
What do others that have done
business with the provider have
to say about them
What type of materials do they
intend to use and what is the
guarantee
What is their financial proposal
and how does it work
Why does the provider believe
this is something the school
should do
What relationship, if any, does
the presenter have with their
competitors (this industry is
small, so some may actually do
work for each other)
COST TO THE
SCHOOL:
If you have ever explored a “green”
endeavor, you have undoubtedly
discovered that it is not cost effective.
This is true of the solar industry as
well. There is only one factor in
BECOMING GREEN
– TO SOLAR OR
NOT TO SOLAR!
B
y
C
a r o l
M
e i n i n g e r
In the fall of 2011, Michele King, Middle School Science
teacher and Science Coordinator for The Pinnacle Charter
School, presented the idea to Pinnacle leadership to take a
big step toward becoming a “green” school by installing solar
panels on the school’s facilities.
today’s economy that makes any green
project financially viable and that is
government subsidy. The common
proposal of solar providers today is for
the provider to pay for the capital, and
the client (the school) to buy the solar
energy produced from the provider.
The key to making this work for the
school is the rate at which the solar
energy is purchased. There are credits
given to the provider in various forms
from government and Xcel Energy that
helps them to offset their cost. There
are also lowered utility rates provided
to the school for using solar, known
as the Solar Photovoltaic Time of Use
rate (SPVTOU). The lower SPVTOU
rate helps the school to offset the cost
of buying the solar energy. Typically,
there is a graduated rate for buying
the solar charged to the school by
the provider – one that increases
each year. The gamble here is to
believe that the rate of increase on the
solar energy will not be greater (but
actually be less) than what you might
have experienced if you had stayed
with Xcel. The critical point here is
to attempt to negotiate the rate down,
and if you can, require a reduction
in rate or some other benefit if
government or Xcel subsidies improve
for the provider when the project is
complete. For The Pinnacle, the first
few years are predicted to see a slight
increase in overall costs, but then an
eventual lower cost than if we had
chosen not to go solar. This means the
savings eventually come through saved
expenses rather than lowered cost
from current billing.
FACILITY
CONSIDERATIONS:
The main watch point here is the
roof. Things to consider are whether
the roof is stable; whether the
current roof warranty will continue
once solar is installed; who will be
responsible for repairs, and under
what circumstances. The Pinnacle has
three buildings that were potentially
viable for solar installation. One
building had trees from a neighboring
property that would have blocked the
sun and negated any benefit from the
solar. The neighbor agreed to remove
the trees; however, we discovered the
roof actually would not viably support
the panels due to its construction and
placement of HVAC units. The solar
provider will initiate and investigate
all of these issues, but you want to
make sure to be a part of the process
so all risks are known and discussed.
For example, if a leak or tear in the
roof were to happen, it can be caused
by the weather, a facility worker
dropping a tool, or the solar panels
and installation. Working with the
existing warranty holder, the school
will want to make sure it specifies in
the final contract which entity will
be responsible for the repairs and the
turn-around time for the repairs to be
made.
BOND COMPLIANCE:
If the school holds government, tax-
exempt bonds, the financial proposal
and contract will need to be reviewed
and approved by the school’s bond
counsel. The government considers
the solar provider as making money
from the use of the school’s facilities.
This is allowable within certain
parameters. The school’s bond counsel
will review this as part of their bond
compliance responsibility and should
not be a cost the school.
FINAL WORD:
The solar industry is small with
regard to the financiers and providers
available. There are good and
knowledgeable folks out there and
many interested companies that
want to advance a green society.
The Pinnacle is pleased with the
relationships we have, but be aware
that the financing entity may change
several times before the final one is
identified. This is just the nature of
the industry, its size, and reliability
on government subsidies. You would
be wise to be cognizant of this so that
you can track the changes.
Our great teacher and science
coordinator Michele, now has us
walking into the world of creating
bio-diesel for our buses – another
adventure!
Carol Meininger is the CFO for The Pinnacle
Charter School.
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