CITY OF SAN CARLOS CALIFORNIA TAKES AN INVESTMENT
APPROACH WITH SOLAR ELECTRICITY
Bound by Strict Investment Codes and Restrictions, City Finds Photovoltaics
Garners a Better Return
May 9, 2005 (San Carlos, Calif.) -- When you are responsible for the
finances of a California city, and are investing its money, one thing is always
for certain; investments will have low risk. State and local government codes
restrict the type and duration of investments that cities can make, with safety
of public funds the priority. However, these limitations usually result in low
rates of return. But, investing in the market is not the only way to help cities
make the best use of available cash. The Director of Finance for the City
of San Carlos, Richard Averett, opted to review a proposal to install an RWE
SCHOTT Solar photovoltaic (PV) system on the city’s corporation yard as an
investment rather than as a purchase with a payback period. The result? The City
now has a 60kW system, installed by EMCOR®
Energy & Technologies of San Francisco, that returns its cost, plus
interest and a little more than $100,000 over the life of the installation,
beating out a comparable 25-year cash investment using a 4.5 percent rate of
return. In addition, the system has returned some public recognition in the form
of an award from The
Public Technology Institute (PTI) at its annual Congress for Technology
Leadership event.
Federal- and state-tax incentive programs, coupled with California’s rebate
program for reducing the upfront cost of a PV system, have driven the PV market
in California for a number of years. However, entities such as public schools or
municipalities do not benefit from the tax savings and cannot depreciate capitol
expenditures, which for the commercial market helps reduce a PV system’s
payback period considerably. Yet, for cities like San Carlos, there are some
things they can count on generally not considered in a commercial PV evaluation,
being around longer than the investment and banking on its return for at least
the next 25 years • and beyond.
“If you look at this PV system from a purely financial, investment point of
view, it makes good sense. The rate of return is better than we could get
investing in U.S. Treasuries or government-run investment pools, considering the
avoided electric usage costs for the buildings fitted with the PV systems,”
said Averett. We expect monthly electricity bills to net out to zero. If energy
costs continue to rise faster than normal, we’ll see an even greater return on
our investment. And, of course, this is just the money side of things. PV
systems generate clean, renewable energy. They reduce the amount of green house
gases that would have been produced otherwise by our electricity use, helping us
protect the environment while we save money, and in this case, earn a return on
it.”
About the Installation and Award
The 60kW system consists of two arrays, one rated at 45kW and the other at 15kW.
Both systems sit on flat roofs at the City’s corporation yard, using the RWE
SCHOTT Solar non-penetrating SunRoof™
FS mounting system. The electricity developed by the two systems is fed into
two separate inverters that combine the energy at a netmeter, which sends excess
energy back into the grid for use later when the system is not producing
electricity. Over the course of a year, the systems are expected to save between
$14,000 and $14,500 per year (at today’s utility rates), effectively
zeroing-out the electricity bill for the two buildings. PTI recognized the City
of San Carlos for its “Photovoltaic Generation Project at the City Corporation
Yard” at its 2005 Congress for Technology Leadership, an annual event bringing
together local government technology leaders and practitioners. San Carlos
received the Honorable Mention award in the small government, energy and
environment category. Presentation of the award will be May 9.
The City of San Carlos, California is located 23 miles south of San Francisco
and 23 miles north of San Jose. The municipality of San Carlos covers 4.83
square miles with a population of more than 28,000.
ABOUT RWE SCHOTT Solar Inc.
RWE SCHOTT Solar Inc. is North America’s leading manufacturer and distributor
of solar power components and systems, serving customers throughout the Americas
from sales offices in California, Massachusetts and the State of Washington. The
company’s U.S. headquarters and manufacturing facility in Billerica,
Massachusetts, produces the largest solar power module available worldwide, the
ASE 300™. A pioneer in the design and development of complete solar power
solutions, RWE SCHOTT Solar Inc. serves a highly diverse market including
grid-connected residential and commercial systems, and grid-independent
industrial, governmental and utility applications.
RWE SCHOTT Solar Inc. is a subsidiary of RWE SCHOTT Solar GmbH located in
Alzenau, Germany. RWE SCHOTT Solar GmbH is a joint venture of RWE Solutions, a
wholly-owned subsidiary of the RWE Group, a global international multi-utility
concern with core businesses in electricity, gas, water, waste management and
recycling; and the SCHOTT Group, a leading international specialty glass
manufacturer. The RWE and SCHOTT companies had combined sales of over $55
billion in 2002, and employ nearly 150,000 people worldwide.
For more information, please visit: RWE Schott Solar Inc. -- www.rweschottsolar.com;
RWE Group -- www.rwe.com/en;
Schott Group --
www.schott.com.