It's been interesting to watch, listen and learn as the Rec Centers of Sun City (RCSC) has worked through the past 4 months of installing solar at 14 locations including all of the rec centers (7) and most of the golf courses. Originally there were to be 17 in total but two didn't qualify for the rebates and one wasn't able to fit the with a livable panel configuration. My initial take was OMG. But as more of them went up and became functional, the look became less obtrusive and more practical looking. And let's be honest, one of the first things we learn in the AZ sunshine is to park in shaded places whenever possible. It brings a smile to my face as I see people parking beneath those structures. But this venture was about way more than shade. There has been a handful of critics regarding the solar purchase, including the fact we used a lease agreement. The 12 million dollar project was significant in both cost and scope and the lease was the only way for us to get into the game. As a non-profit organization we were not eligible for the rebates and incentives, but the lease allowed those savings to be captured by those doing the project. We knew over the term of the lease (20 years) there would be a net savings. We also knew there would be a buyout option at 66 months that would allow us to purchase the system outright. The board has now built into the long range plan that buyout option and from a practical standpoint, the RCSC and more importantly the residents of Sun City will cut their energy usage costs at these facilities dramatically. The buyout feature radically improves the savings to all of us. Rather than trying to explain it, here is the recent release to cardholders signed up for email blasts from the RCSC: RCSC Goes Solar – What does that mean? June 25, 2013 FOR IMMEDIATE RELEASE As more and more Sun City residents have chosen to lease photovoltaic (“PV”) solar systems for their private residences, they have become better informed about the process of doing so and how it works. However, RCSC would like to explain what it means for RCSC to go solar and how it works. One way to help fund commercial PV [electric] solar projects is with Federal and State tax credits. As a non-profit organization, RCSC is not eligible for these credits. Therefore, an organization that was eligible purchased the PV solar systems and must maintain ownership of the solar systems for over 5 years in order to retain the credits. RCSC has entered into a 15-year lease agreement with the owner of the solar systems located on RCSC facilities. The installation was also facilitated, in part, by the APS Renewable Energy Incentive Program. This Program offers financial incentives to customers who add Renewable Energy systems to their homes or businesses. The Program is funded by APS customers and approved by the Arizona Corporate Commission. The annual incentive on the 14 PV solar projects on RCSC property is estimated at $185,000 per year for the next 20 years, or $3.7M total. The projected savings of electricity costs over the term of the lease averages $480,000 per year, while the lease expense averages $609,000 per year. With the APS incentive, this creates an average positive variance of $56,000 per year. So when RCSC Members ask, “What is the solar costing us?” and RCSC answers, “Nothing!” that’s a fact. The financial benefit provided from the solar systems is greater than the cost of the lease. And yes, all the parking structures are included with no additional costs to consider. What’s not included in the above are any costs for repairs and maintenance, which are expected to be minimal, and insurance on the solar panels, approximately $13k a year, which are also easily covered by the $56,000 per year overall savings. This, however, is not the only opportunity for savings. The lease offers some options and opportunities for additional savings including the buyout of the lease at 66 months for $4.4M. The Board will update the long-range plan accordingly in the near future. The RCSC Board of Directors has unanimously agreed to use Preservation & Improvement Funds (“PIF”) and take advantage of these opportunities for additional savings of over $3M. Currently RCSC has a lease for solar systems which are projected to provide with energy savings, incentives, lease payments, insurance and estimated repairs and maintenance expense a net benefit of approximately $40,000 per year to RCSC. At 66 months into the lease, RCSC will buyout the lease with PIF funds, creating an annual operating expense benefit of approximately $650,000 per year for the next 14½ years, at which time the incentive will end and RCSC will be left with a projected net $450,000 per year savings. RCSC believes that this investment in solar is not only good for the Sun City community, it is good for the greater Phoenix area as solar power helps abate pollution and additional infrastructure costs such as new natural gas plants used for providing electricity. Awesome stuff and for the long haul, this is great news for all of us living in Sun City.
It is really, really nice to park in shade when I go to Sun Dial Pool (3x week). Thank you RCSC for this improvement. That said, I have a suggestion for anyone purchasing a new car like I did when I moved to Sun City. Be sure to get a remote start. I can stand inside a building and turn on my car. Air conditioner comes on and it is nice & cool when I get in. Also for newbies, get a reflector shield to put in front window of car.
RCSC had to purchase $10 million worth of additional liability insurance specifically for the solar panels. Also, RCSC is responsible for maintenance costs. In 66 months, RCSC plans to purchase the antiquated solar panels for $4.4 million. In 66 months, the solar panels will be obsolete, if not needing to be replaced entirely. APS is seeking to raise its rates because solar panel use is taking away revenues. A lot to think about. But, hopefully in 15 years at the end of the leasing period we might save a few cents on electricity. Hope we're all alive then. By the way, a $10-million liability should have been voted on by the RCSC members. Article X mandates it. But, its up to RCSC members to enforce it. That is done only by class action in Superior Court. If people wanted covered parking, it would not have costed as much as the solar panels and it would have kept the rain off the cars. The solar panels do not.
