General Land Office
Border Solar Workshop
Harlingen, Texas
June 2, 2009
Facilitated by Chris Winland
Good Company Associates
cwinland@goodcompanyassociates.com
Agenda

Introductions

Review of Workshop Goals

Overview of Barriers to and Examples of Solar Projects

Tour of San Benito Water Purification Plant Solar Installation (11:00)
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Lunch (Noon)
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Discussion

Wrap Up and Closing
Introductions

Chris Winland

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Consultant and Project Manager at Good Company
Associates
 Renewable energy and energy efficiency policy and project
development
 Clients include solar, geothermal, biomass, algae, wind,
energy storage, energy management, and energy efficiency
companies as well as state and local governments
Former consultant and project manager at IBM Global
Services and MTG Management Consultants
Former Chief of Staff for Texas State Representative Mark
Strama
Workshop Goals

Share information about municipal solar projects


Identify the missing links in developing more solar
projects (scale: 45kW-1MW) tied to public
infrastructure along the Border

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Discuss barriers and existing projects
The San Benito plant is currently the only one
Discuss methods to encourage the North American
Development Bank to incorporate solar project
financing into their 15-20 year financing plans for
new public infrastructure projects
Major Barriers
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Financial
Technological
Physical (Infrastructure)
Policy
Leadership
Uncertainty
Risk Aversion
Other
Sample Projects
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San Benito
Boulder, CA
Austin, TX
San Antonio, TX
Houston, TX
Berkeley, CA
Palm Desert, CA
State of Connecticut
Agua Prieta, Sonora
Common Financing Options
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Power Purchase Agreement (PPA)
Direct Purchase/Own/Operate System
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Grants, Bonds, Incentives
Partnerships
Government Supported Private Projects
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Solar Leasing
Property Tax Financing
Additional Financing Options
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Kyoto Protocol Clean Development Mechanism (CDM)
and Carbon Credits
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North American Development Bank (NADB)
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http://www.nadb.org/
ELIGIBLE ENVIRONMENTAL Priority SECTORS: Water
supply/conservation; Wastewater treatment; Municipal solid
waste
Expanded Mandate Sectors Include: Air quality improvement,
Clean & renewable energy, and Efficiency
UNDP Global Environment Facility (GEF) Grants


http://cd4cdm.org/index.htm
http://cdm.unfccc.int/index.html
http://www.undp.org/gef/
Energy Efficiency Trust (FIDE)

http://www.fide.org.mx/
Discussion

Identify the missing links in developing more
solar projects (scale: 45kW-1MW) tied to
public infrastructure along the Border
Discussion

Discuss methods to encourage the North
American Development Bank to incorporate
solar project financing into their 15-20 year
financing plans for new public infrastructure
projects
Appendices
Market Overviews
Texas ERCOT Market Overview
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Ultimate customers served: 22
million
Area served: 85% of Texas load,
75% of Texas land
Generating units: 566
High-voltage transmission
monitored: 40,327 miles
Installed capacity: 81,267
megawatts (MW)
2008 peak demand: 62,174 MW
(August 4, 2008)
Wind generation: 8,000 MW -- most
in nation
ENERGY PRODUCED 2008
Water/Other 2%
Wind
5%
Nuclear
13%
Natural
Gas
43%
Coal
37%
Source: ERCOT 2009
Business Case for Solar in
Texas

30% Federal Investment Tax Credit

State Legislative Support:
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Renewable Portfolio Standard
HB 1937: Property Tax Assessment Local Option
Financing Opportunities:

Direct Purchase/Own/Operate System
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Power Purchase Agreement (PPA)
Partnerships
Government Supported Private Projects
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Grants, Bonds, Incentives
Solar Lease System
Property Tax Assessment for Residential
Other…
Mexico Power Generation
with Renewable Energy

In 2006, Mexico had a little over 12,000 MW of installed capacity based on
renewable energy:

11,545 MW dedicated to public service (CFE and LFC),

504 MW installed under cogeneration and self-support schemes

18 MW in isolated systems.
Public
Service
96%
Self-Supply
4%
Geothermal
8.0%
Biomass Wind
3.84% 0.02%
Hydro
88.0%
Source: Slide courtesy of Francisco Barnes CRE
Presentation at Border Energy Forum in 2006
Photovoltaic
0.15%
Mexico’s Power Industry
Investment Framework

The Power Sector Law was amended in 1992 to allow private
participation through six types of legal arrangements only:

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Self-supply
Cogeneration
Independent power production (IPP)
Exports
Imports for self-consumption
Small-scale production
The remaining activities are reserved exclusively for CFE and LFC.
Primary Obstacle: Grid Interconnection of projects not
owned by CFE/CRE.
Source: SENER, Aldo Flores Quirog, Assistant Secretary of International Affairs, Ministry of Energy, Mexico
October 18, 2007 Border Energy Forum Presentation
Common Financing Options
Direct Purchase
The public entity purchases, installs, owns, and operates a PV system
directly.
 Grant Opportunities
 Texas SECO Competitive Grants: $10M for Renewables

Apply for 1 MW project funds with a 50% match from City
DOE Funding thru Solar America Cities
 EPA
 Also: CityFIRST Model for private sector projects– Stimulus Funding
May be Available
Clean Renewable Energy Bonds (CREBs)

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Private Sector Bond Purchaser receives a Tax Credit in lieu of
interest payments from the government agency.

Standard Bonds or Reserve Funds
Other?

Additional Consideration: Renewable Energy Production Incentive (REPI)

Direct Purchase Case Study/Tour:
San Benito Water Purification Plant – Solar
Installation
Sources: City of San Benito and GLO Press Release Oct 3, 2008
Direct Purchase Case Study/Tour:
San Benito


U.S. Environmental Protection Agency created grant for Solar Energy System to be
awarded & administered by Texas General Land Office
San Benito applied for grant and was awarded $350,000.00
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Construction - $325,000
Educational Component - $25,000
San Benito awarded construction to WorldWater & Solar Technologies Corp.
Ribbon Cutting Ceremony held October 3, 2008
North American Development Bank will track project
Web monitoring: Fatspaniel.com
Manufacturer: Sharp Solar
Model: ND-208UI
224 modules
Capacity: 45 kW (generates about 10% of power needed to filter up to 6 million gallons of
water daily).
25 year warranty (life potential 40 years)
Upfront Estimated Production and savings:

Average: 70,000 kWh per year

Estimated Annual Savings: 70,000kWh x $0.10/kWh = $7,000
Sources: City of San Benito and GLO Press Release Oct 3, 2008
Power Purchase Agreements
Source: Jason Coughlin, NREL
Benefits of a PPA
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Eliminates upfront capital cost
Allows Public Entity to benefit from tax incentives
 500 kW system costing approx. $3.5-$4M => 55% Federal Tax
Benefits (combined 30% ITC and MACRS)
Locks in Long Term predictable electricity prices
Transfers O+M to 3rd Party
Provides a possible path to ownership with various options
termination options
Additional Considerations:
 Net Metering
 Interconnection
 Easement/Lease
Source: Jason Coughlin, NREL
Key Elements of a PPA
Note: Environmental Attributes (e.g. RECs) typically remain with the system owner.
Source: Jason Coughlin, NREL
Economics of a PPA
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-Installed Cost of PV System
+Tax Benefits
+Rebates/Grants/Other Incentives
+RECs or Carbon Credits
-Cost of Capital
+Projected kWh Production
 Cost of kWh in year one of PPA + Annual Escalator, or
 Fixed price (higher in year one)
End of Term Options:
 Buyout,
 Extend PPA, or
 Remove System
Source: Jason Coughlin, NREL
PPA Process
Source: Jason Coughlin, NREL
PPA Case Study:
Boulder County
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PPA Process
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Site Inventory/Assessment
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Sort by Availability of Incentives (by Utility)
Analyzed Options, including:

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Roof Space, Condition, Orientation
Historic Demand
CREBs
Direct Purchase
PPA
Sale/Leaseback
Boulder County’s PPA

621.25 kW of PV on 7 Buildings under the PPA
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Additional 100 kW funded directly by County (small systems would have increased rate)
3 buildings are projected to be 100% solar-powered
Meets 10% of Electric Demand
Supported by Xcel Utility Rebate of $3.50/W
Parameters
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Part of Larger Boulder County Sustainability Plan, including:

Energy Efficiency/Green Building LEED Gold Standards applied to new construction and existing buildings
Wind Energy Purchase (50% of Demand)
Biomass
Solar
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Plug-in Hybrids
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Fixed Cost per kWh (~2¢/kWh less than utility rate) for 7 years (then renegotiate)
Conservatively estimate $822K in Savings based on historical rate increase of 5%
Set aside reserve funds for possible buyout in year 7 (~$1.5M)
Property Tax Financing for Residential PV Systems and Efficiency Measures
Considering additional 130 kW distributed among two sites
Source: Ann Livingston, Boulder County (Colorado) Sustainability Coordinator
PPA RFP Case Study:
Austin Energy
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Austin Energy 30 MW Solar PPA:
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RFP Closed October 2008
 15 responses were received
 Status: currently in contract negotiations with the selected
developer Gemini
Purchasing Manager: Rosemary LeDesma
rosemary.ledesma@austinenergy.com; (512) 322-6155
Note: Sample RFP available.
Source: City of Austin, Austin Energy
PPA RFP Case Study:
CPS Energy - San Antonio

CPS Energy – San Antonio Solar PPA up to
100MW:
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RFP closed October 2008
24 respondents with 36 project proposals
Status: currently reviewing proposals
Note: Sample RFP available.
PPA RFP Case Study:
Houston RFP for 10 MW Solar
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Location: Current Houston RFP
Type: Decommissioned Landfill
Technology: Solar PV
Closed November 2008
Capacity: 10 MW
Financing Method:
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PPA: City of Houston will buy all power and RECs for 20
years
Structure: Design, Build, and Operate
Note: Sample RFP available.
Source: City of Houston
Partnership Case Study:
San Antonio Tessman Road Landfill Solar
Demonstration Project
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Online March 2009
Technology: Uni-solar flexible strips on
geomembrane landfill cover
Partnership between Municipal Utility CPS
Energy and Landfill co Republic Services in
conjunction with existing biogas-to-energy
operation
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CPS assisted with upfront costs and
interconnection to distribution grid of the solar
demonstration
Republic Services owns and operates the solar
project and utilizes the power on-site
Biogas-to-energy project serves Austin Energy
Source: Republic Services
Projected combined Biogas and Solar capacity
9MW - enough to power 5,500 area homes

Solar: ~10-100kW
Source: http://www.reuters.com/article/pressRelease/idUS131170+02-Apr-2009+PRN20090402 ; CPS Energy Public Information Office; www.geosynthetica.net and
http://www.republicservices.com/index.asp
Residential Solar Lease Program
Case Study: CT Solar Lease

Offered by CT Solar Leasing LLC in partnership with AFC First
Financing Corporation and the Connecticut Clean Energy Fund
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No Down Payment required
Moderate Income Restriction: 200% or less than median income
Fixed Monthly Cost over 15-year Term
Works with CT Clean Energy Fund Residential Solar Rebate
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$4/W for the first 5kW
$2.5/W for the next 5kW
Sales and Property Tax Exempt
Solar Dividends – A portion of the sale
of RECs can be reserved for
future system operating costs
End of Term options:
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5-yr extension at reduced rate
Buyout at current value
Pay for removal/return to
CT Solar Leasing
Source: http://www.ctsolarlease.com/
Property Tax Assessment for
Residential Solar
A municipality funds the installation of residential solar PV through bond debt,
which is recovered over ~20 yrs through a special property tax assessment
on only participating properties. GHG Emissions Management is the
primary objective behind most of these programs.

Examples:
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BerkeleyFIRST (CityFIRST), CA – Bond Sale to Private Financial
Institution
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Renewable Funding: http://www.renewfund.com/
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Authority under AB811, the State of California’s Clean Energy Municipal Financing
Law or Mello-Roos
Boulder County ClimateSmart Loan Program, CO – Local Sale of Bonds
Palm Desert, CA - City Reserve Funds

http://www.cityofpalmdesert.org/Index.aspx?page=484
Case Study:
BerkeleyFIRST
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Location: Berkeley, CA
Purpose: To help residential property owners reduce their environmental impact
and likely save money, by providing full financing for residential PV.
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One of many Berkeley Energy Conservation Programs
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􀂃 Residential and Commercial Energy Conservation Ordinance
􀂃 Low Income Weatherization Program
􀂃 Smart Solar Program
􀂃 Berkeley FIRST – solar financing
Authority: Mello-Roos
Property Tax Financing for Residential Solar PV
Goals for 2020: Solar PV & thermal to meet 11% of the GHG Reduction Goal in Climate Action
Plan
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Residential Installations
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Now: 2.9 MW
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Goal: 5.3 MW

Commercial Installations
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Now: 0.27 MW
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Goal: 1.3 MW
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
When have purchased 20,000 municipal bonds,
Renewable Funding will aggregate and re-sell.
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
BerkeleyFIRST
Source: Excerpted from Berkeley California Energy Program Officer Neal De Snoo’s May
21, 2009 AESP Presentation.
Case Study:
Boulder County ClimateSmart Loan Program
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Location: Boulder County, Colorado
Purpose: To help residential and commercial property owners reduce their
environmental impact and likely save money, by providing full financing for
energy efficiency improvements and installation of renewable energy
technologies, including solar.
Authority: HB 08-1350 and County Ballot Measure 1A
Overview:
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Measures: Energy efficiency and renewable energy (RE/EE)
Special assessment placed on property—easy payment via property tax statement –
repayment responsibility remains with the benefitted property
Countywide pool of funds obtained through sale of bonds
15 year term
Up to the full upfront cost of improvements is loaned
Property owners opt in (no general fund allocation)
Complements rebate and incentive programs
Property owner workshops and contractor briefings
Utility bill release
Source: Excerpted from Boulder County (Colorado) Sustainability Coordinator Ann
Livingston’s May 21, 2009 AESP Presentation.
Case Study:
Boulder County ClimateSmart Loan Program
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County Role:
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Form countywide LID
Refer ballot measure and
manage bond sale process
Receive VCA assignments
and carry forward
Program design with
municipalities
Market program with
municipal and other
partners
Place special assessments
and collect payments
Continue to work at state
and federal levels
Source: Excerpted from Boulder County (Colorado) Sustainability Coordinator Ann
Livingston’s May 21, 2009 AESP Presentation.
Case Study:
Boulder County ClimateSmart Loan Program
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Size of Residential Program
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$40 million already approved by voters through Ballot Measure 1A
The County has apportioned $28 million for residential properties and $12 million for commercial
properties
Round One:
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About 400 borrowers
$6.6+ million
May 19 and 20 bond sale
Loan Types
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Minimum Loan: $3,000 per Home
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Open Loans – can be applied to primary or rental properties (funded by taxable bonds)
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15 year Term
Max Amt: 20% of statutory actual value of property or $50,000, whichever is less
Taxable
Assessment Rate: 7.00% (est)
Income Qualified Loans – lower interest– primary residences only (funded by tax exempt bonds)
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15 year Term
Max Amt: $15,000, as per federal law

Income Qualified Loans may be combined with Open Loans up to the Open Loan maximum
Tax-Exempt
Assessment Rate: 5.5% (est)
Source: Excerpted from Boulder County (Colorado) Sustainability Coordinator Ann
Livingston’s May 21, 2009 AESP Presentation.
Case Study:
Boulder County ClimateSmart Loan Program
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County Administrative Costs
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􀂃 One time “cost of issuance” for the bonds - less than 3% of the bond amount
􀂃 County costs for organizing and administering the program approximately $100k to
110k /yr
􀂃 General fund (tax) dollars will not support the program
􀂃 Borrowers will support the program through:
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􀂃 non-refundable $75 application fee
􀂃 origination fee (1-2% of loan value)
􀂃 small portion of assessment rate
􀂃 reserve fund
Lessons Learned
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􀂃 Lack of ability to guarantee a rate (or exact amount of fees) in advance makes
borrowers uneasy
􀂃 New types of programs require significant amount of contact with participants
􀂃 Can impact local companies between program announcement and loan approval
􀂃 Can generate interest in EE measures, harder to manage than RE
􀂃 Program creates a ripple effect
􀂃 Local economic stimulus
Source: Excerpted from Boulder County (Colorado) Sustainability Coordinator Ann
Livingston’s May 21, 2009 AESP Presentation.
Case Studies: Solar Thermal Plant
Agua Prieta, Sonora - Public Service

CFE Project: Hybrid combined cycle (240 – 480
MW) and solar thermal (30 MW) plant
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Total Project Cost: $49.35 M
Funded with 2006 Grant from Global Environment Facility
Anticipated carbon emissions reduction estimate: 391,270
tons of carbon dioxide over 25-year economic life
Status Update???
No Small Municipal/State PV Projects along the Border
in Mexico.

What is needed???
Source: GLO; 2006 Border Energy Forum Presentation by Francisco Barnes CRE; World Bank
Solar Suppliers and Developers
Technology and Capability

Manufacturers, for
example:
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Sharp
First Solar
SunPower
Kyocera
UniSolar
BP Solar
Schott Solar
SunTech
GE Solar

Developers, for
example:
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First Solar
Texas Solar
Acciona
SunEdison
SunPower
BrightSource
Abengoa
Simple Solar
Additional Resources
Additional Resources

ICLEI Local Governments for Sustainability:


Database of State Incentives for Renewables and Efficiency:


www.dsireusa.org
GLO Border Energy Forum Archives:


www.icleiusa.org/
http://www.glo.state.tx.us/energy/border/forum/index.html
DOE Energy Efficiency and Renewable Energy: State Energy Program

http://apps1.eere.energy.gov/state_energy_program/feature_detail_info.cfm/start
=4/fid=82?print

DOE TAP Webcast “Third-Party Financing and Power Purchase
Agreements for Public Sector PV Projects”


Blog: http://eere.typepad.com/tap/ and archive:
http://apps1.eere.energy.gov/wip/tap_webcasts_archive.cfm#may09
Massachusetts Renewable Energy Trust Commonwealth Solar:

3rd Party Finance Guidance: http://www.masstech.org/solar/third.html#
Additional Resources

Alliance to Save Energy Links to Companies in Mexico
http://www.ase.org/directoriomexico/index.htm

Border Energy
http://www.glo.state.tx.us/energy/borderenergy/html/index.htm

World Bank
http://www.worldbank.org/

Mexico CRE
http://www.cre.gob.mx