The school system teamed up with Washington County Public Schools to hire CQI Associates to help traverse new territory in requesting bids and negotiating a Power Purchase Agreement with Nautilus once the contractor was selected.
By Marge Neal
Frederick News-Post Staff
A 20-year contract between Frederick County Public Schools and a solar energy provider to install solar panels at Oakdale High School will save the schools an estimated $190,000, but not without the help of a much larger state energy grant.
The school system has inched closer to flipping the power switch on a $2.2 million solar panel array at Oakdale High School that, once activated, is expected to produce about 16 percent of the school’s electricity. The school system has a 20-year contract with Nautilus Solar Energy, the installer and owner of the system, to buy the electricity it produces at a rate lower than that offered by its regular supplier.
Over the course of the contract, FCPS expects to pay $1.57 million for the electricity generated by the array, at a savings of $190,000. The cost to install the array is being covered by a $500,000 Maryland Energy Administration Project Sunburst grant.
Per the agreement with Nautilus, FCPS will pay $0.055 per kilowatt, as opposed to $0.0914 per kilowatt charged by the school system’s main supplier, the Hess Corp. Project Sunburst grants are provided through a one-time program funded with federal stimulus funds.
Maryland allocated the entire $9 million it had to award through the program, according to Maryland Energy Administration spokesman Ian Hines. The savings are calculated on estimated increases in the cost of electricity cost over the next 20 years, according to Charlie Dalphon, energy and recycling coordinator for FCPS. There was no direct cost to the school system for the installation of the array, nor will there be any costs for maintenance or other needs over the life of the contract, according to school officials.
The school system teamed up with Washington County Public Schools to hire CQI Associates to help traverse new territory in requesting bids and negotiating a Power Purchase Agreement with Nautilus once the contractor was selected.
Hines said MEA officials believe the school system’s savings over the 20 years — discounted for inflation — will be closer to $317,000. Frederick County school officials used an outdated formula in figuring their savings, Hines said, adding he also believes the $190,000 figure does not take into consideration the $1,950 per megawatt of demand per month fee assessed by the utility provider.
MEA officials do not anticipate more money becoming available to continue the program. Ray Barnes, executive director of facilities services for the school system, said the project would not have been economically feasible without the $500,000 grant, as well as substantial rebates to the energy company in the form of state and federal solar renewable energy credits.
“The only way this works for Nautilus is these credits,” Barnes said. “Otherwise, this project wouldn’t happen — financially, it wouldn’t make sense.” Barnes said the school system is trying to look into the future for ways to reduce energy costs, and the solar project puts FCPS on that path.
With much talk about the nation’s need to depend less on fossil fuels, the creation of solar power will be just one way to explore alternative energy sources, Barnes said. “This gives us the experience working with this kind of project, at no cost to us,” Barnes said. “And over the course of the contract, we will be able to see how the program works — and if it works as well as we expect it to. Without this program, we certainly could not justify this expense for this kind of return.”
Hines said the project is about much more than balancing a ledger sheet. He said moving forward with this kind of project is about taking better care of the planet and lessening dependence on fossil fuels.
State legislators have mandated that 20 percent of Maryland’s electricity be generated by renewable sources by 2022.
The mandate includes the goal to generate 2 percent of electricity through solar energy systems. “Our policy goal is to diversify our portfolio of energy generation — and to grow our renewable energy generation,” Hines said. “It might not seem to be cost effective, but there is what we call a cost in action. We know carbon emissions are bad for the planet and we’re looking to renewable sources to provide clean, reliable and affordable energy. We definitely think solar energy is a wise investment to make.”
Hal Keller, executive director of fiscal services for Frederick County Public Schools, also called the installation a good one for the school system. “From the school system’s perspective, this was a $190,000 return on a zero investment,” Keller said. “It made sense to us.”
At the end of the contract — on March 31, 2031 — the school system will have the option of extending the purchase agreement, buying the system outright or having Nautilus remove the system. Twenty years is stretching the life span of the solar array, according to Barnes, who said he doesn’t anticipate the school system would purchase the panels.
“I think the plan would be to replace the system with a newer one that will be much more technologically advanced than this one,” Barnes said. “I think these systems will just get better and better.”