The select board opted not to sign a power purchase agreement with All
Earth at its September 13 meeting, after a discussion of the changes and
whether to move forward. The town was already in a legal quandary as to
whether the select board had the authority to sign a multi-year power
purchase agreement (PPA), committing the town to a multi-year purchase
without specific voter approval.
MULTI-YEAR AGREEMENT
The town had been in consultation with its attorney and in negotiations
with All Earth Renewables about specifics in the contract related to a
multi-year power purchase agreement (PPA) when All Earth Renewables
notified the town, in an September 9 letter, that the terms of the PPA
had changed.
That change meant that instead of paying 18 cents per kilowatt hour for
power produced by the solar trackers for five years, the town would be
required to pay 25 cents per kilowatt hour. Additionally, rather than
having the option of buying the solar tracker array after five years,
the new proposal from All Earth Renewables no longer allowed the town to
opt out of the project after five years.
The proposed new contract stated that at the end of the five-year
initial term, the town's choices are limited to purchasing the array at
fair market value, or renewing the PPA for up to two more five-year
terms. Abandoning the project after five years would only be an option
if the array produced less than 90 percent of its projected output.
PREPARE THE SITE
Another factor complicating the project is the fact that, to prepare the
town garage site for the installation, the town needed to have some
tree work done and also have an old trailer/mobile home removed at an
estimated cost of $21,000, which had not been budgeted this year.
Waitsfield was among many Vermont towns to be pitched for a solar
project this spring by several companies seeking to take advantage of
state and federal tax credits that expire at the end of this year. All
Earth Renewables and another company that approached Waitsfield both
proposed installing solar panels (either fixed or trackers) at no cost
to the town. The systems were scaled in size to create as much power as
the municipality used annually. The town would be required to purchase
its power from the company and at the end of five years (or 10 years
with one company) have the option to purchase the system.
$1,000 PER YEAR
The original pricing proposed was favorable to the town and would have
resulted in a savings of about $1,000 per year on electricity costs. If
the town purchased the All Earth system after five years, it would have
realized the per kilowatt hour premium paid to power systems that feed
into the grid.
At this week's meeting, board members expressed regret that the new
contract was not something beneficial to the town. The contract changes,
according to David Bittersdorf of All Earth Renewables, were required
because the state of Vermont, halfway through the tax year, capped the
state's business solar tax credit, making it a competitive process
rather than a given credit. The original deal was based on that state
credit as well as a federal investment tax credit.
After a discussion of the proposed new contract, board members voted not
to sign the proposed agreement but to keep the issue of renewable
energy on the table and work towards a similar project in 2011. Board
members also discussed bringing the issue of signing a multi-year power
contract to voters at Town Meeting next March. Board members also made
clear that they were not faulting All Earth Renewables for the state's
failure to make good on the tax credits it originally promised.
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