Colorado Real Estate Journal - March 18, 2015
Apple recently announced another move into clean power with the purchase of 130 megawatts of solar photovoltaic generation, joining fellow corporate powerhouses Google, Ikea and Whole Foods in owning renewable energy as part of its sustainable operation and cost reduction programs. Now this trend is finding its way into smaller companies and across industries, revealing that we have passed the tipping point between the environmental share of the equation to go solar and the financial one. Continued downward pressure on installation costs from technological advancements and efficiency improvements helped bring solar to the mainstream. These industry leaders understand that now the numbers alone make it sensible, and that the environmental benefits are more than just gravy. Yet despite the growing allure and affordability, solar remains impossible for a majority of businesses and residents. More than 75 percent of metered utility customers in the U.S. cannot install solar on their rooftops due to building restrictions, shade on their property, prohibitive up-front costs or ownership restrictions, according to the National Renewable Energy Laboratory. Certainly, for business owners who lease commercial space, rooftop solar is rarely feasible. Even a big, flat roof with full sun isn’t going to work if a property owner won’t allow it. How then can building owners, property managers and tenants execute their sustainability strategies when installing solar on site isn’t an option? The answer is by employing off-site solar, specifically community solar. A somewhat new distributed energy solution, community solar is an effective tool for small-business owners and commercial property managers to reduce operating expenses, hedge against volatile energy prices, and have a stake in clean, renewable energy production. Solar community was put in play in Colorado with the Solar Garden Act and allows commercial, residential and municipal entities the option to own clean-energy generation through a centralized utility-scale solar PV project installed on an optimal site in a partnering utility territory. Participants buy individual panels in the shared array, as few as one or up to 120 percent of their electricity load, and then receive a credit for the electricity generated directly on their utility bills.
Using economies of scale and industry experience, companies like Louisville-based Clean Energy Collective, design and operate exceedingly cost-effective installations running from several hundred kilowatts to a few megawatts. Colorado leads the country in the number of community solar facilities, participating utilities and generating capacity, with 75 percent of utility ratepayers having access to a community solar facility. Virtually every customer in utility territory – renters, commercial facilities and nonprofits – can connect into a community’s solar garden. “For ratepayers like small businesses, franchises, condos and multidwelling properties, it can be a game-changer,” said Kevin Morse, commercial sales director for Clean Energy Collective. Morse describes how Alpine Bank, an employee-owned community bank with 37 Colorado branches, is using community solar to achieve its stringent environmental objectives. Last spring, the financial institution purchased more than 1,000 solar panels to spread across five different CEC community solar arrays and four separate utilities to power its banking operations throughout the state. Each participating branch receives electric bill credits for that individual office. “Reducing our utility bill translates into greater profits for the bank,” said David Miller, vice president of Alpine Bank. “Whenever you can do the right thing and make money, that’s a much more powerful driver. And that’s exactly what we’re doing.” With solar ownership versus a solar lease or subscription, electricity becomes the output of an asset controlled by the owner and not just a monthly operating expense. Community solar offers the added flexibility of mobility – if a business relocates, many community solar programs allow participants to transfer their subscription to a new meter within the same county, utility territory or a specified number of miles. Solar panels also may be sold or donated if a customer moves from a partner utility’s service area. National energy services firm McKinstry incorporated community solar into its energy management solutions, recently working with Denver’s South Suburban Parks and Recreation District on a comprehensive community solar purchase. “Community solar gardens have expanded the way we think about delivering renewable energy solutions to our customers and their constituents,” said Alex Montano, McKinstry program manager. “The community solar garden approach eliminates many of the common obstacles involved with installing renewable energy on site and, in some cases, at a dramatically improved financial return on investment.” Dr. Chelsea Stangl, owner of Wynkoop Dental, the first certified green dental office in Denver, rents her space at 1401 Wynkoop St. and is unable to install rooftop solar. “We designed our office to have low-energy consumption, but as a green practice I was also motivated to use a better energy source,” she said. Stangl purchased 62 panels in a Denver community solar array, about a 15.5-kW system, which offset around 80 percent of the operation’s electricity needs. Estimates show Stangl’s system will deliver around $7,600 in savings the first year, payback in less than nine years, and a cumulative savings of $107,000 at 20 years. Colorado is demonstrating that businesses of all kinds not only support solar, but also are clamoring for it. With forecasts of 4 to 5 percent annual hikes in electricity prices, solar can be an effective part of both sustainability and a cost-reduction program.