John Coté wrote a well-researched article on the 5-Megawatt SFPUC solar project that was approved last week. As John points out, the “savings (that the City receives via third-party project ownership) should result in cheaper power”, nicely reflecting my points from the last blog entry.
A few other key points have come up in my discussions with the press over the last few days that I thought people might be interested in:
The cost of non-renewable power versus solar power: Under the Power Purchase Agreement (PPA) with Recurrent Energy, the City is paying just 23.5-cents per kilowatt-hour for solar power. Although John compares this to PG&E’s retail power at 13 cents, it’s important to understand that retail and renewable power aren’t a straightforward comparison. Unlike retail power, several factors are involved in determining the value of solar energy, including its location, output during peak timeperiods, and the environmental benefits. An appropriate comparison would be to look at Recurrent Energy’s price as compared to another large-scale utility solar project: take Southern California Edison’s (SCE) 250 MW proposal, as an example. In their own analysis, SCE concludes their program will cost ratepayers the equivalent of 27 cents per kilowatt-hour – almost 15% more than the City will pay Recurrent Energy for its solar power. In sum, the cost that the City is paying for power is exceptionally priced for solar, and it’s substantially less than if they were to build and own the project themselves.
- The quality of sunshine in the Sunset: The SFPUC’s decision to place this project on the Sunset Reservoir was driven by the City’s realization that solar needs to be widespread, but space is limited in an urban setting. The Sunset Reservoir was the perfect starting point as the roof was recently seismically-retrofitted and offers a vast, flat opportunity for distributed power. Also, contrary to popular opinion, the sun does shine in the Sunset (which we confirmed in production calculations prior to bidding the project) and solar panels actually perform best on cool, clear days.
- The number of green jobs being created: According to current projections, this project will create upwards of 60 new jobs, including electricians, laborers and operators. That doesn’t include the hundreds of people who will be touching this project as it relates to development, engineering, financing, legal work, permitting, marketing, community relations, and numerous other key activities. The magnitude of the project showcases the benefits of solar as a great economic multiplier.
The impact of the construction process: We’ll be discussing this topic further as the project nears final approval, but Sunset Reservoir neighbors and community members should rest assured with my personal pledge that construction will be as brief as possible. Solar is not only quiet when it’s in operation, but is also relatively quiet and low-impact in installation.
Stay tuned for more details as this project moves forward. As you can tell, this project has been incredibly well thought-out and we’re grateful to play a critical part in helping the City meet its renewable energy goals.