Thursday, August 14, 2014

Small Communities need solar power to come out of economic difficulties and become energy independent

Who need to reduce cost of government operations most? These are small communities at their debt limit and are not in a position or permitted by State laws to borrow capital dollars to build solar PV systems.

They have the opportunity to make their own power and pay off the debt from energy savings.
Their challenge is to raise the construction loan to build the system and long term low interest financing to pay ti back. The State and Federal Govt. has significant amount of pension funds that could be used to create a green funding mechanism to help such communities.

The federal USDA rural utility program may be able to help. Only time will tell as we watch the policies for Green project support.  Private capital looks for higher rate of return and larger dollar value projects which does not match with small community needs.

If this can be achieved then these communities can control their energy future and make solar power for the same price as they pay now. After 20 years the systems could be all paid and only O&M costs will remain for next 20 years when the power cost would be less that 6 cents per kWh as compared to Utility cost of over 20 cents /kWh. Energy independence by making same amount of power as they consume they will not be affected by future cost of energy. Fortunately this is possible as Government policy empowers the consumer to become solar power producer.

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Monday, July 28, 2014

Green Construction Loans are Essential for Building Green Energy Projects

Imagine getting a Reimbursable grant of  93% of the Capital cost and still unable to build the farm Anaerobic Digester system to treat waste and make green power. Unfortunately this is a reality in New York State.

Most of the lenders do not understand Digesters and have no risk tolerance for such technology when the grant is offered as collateral. So how do you get a construction loan? Where to go? These are the challenges why so many farmers who have the manure disposal problems can not take advantage of the Grants.

It looks like the Federal USDA is listening to these issues and establishing a large loan fund that can be used for building the system with 70% loan amount against 30% local loan and equity. This potential "USDA - REAP renewable energy funding assistance program"  could be extremely beneficial and capable of creating a wave of economic development across Rural America.

Let us hope this succeeds and soon rural communities and small businesses will be able to gain Energy Independence by building their own Green power generation systems.

Infrastructure investments by the federal Govt. in our communities are essential to replace war funding and create jobs back home so returning Vets can have a job making green energy.

Better days may be ahead for energy Independence at the rural Farms and communities.

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Sunday, May 11, 2014

Climate Change Adaptation by Sustainable Green Communities

Finally the President is talking about the importance of taking action to deal with Climate Change. By now we must realize that some people are simply not going to accept the truth and trying to convince them may be a waste of time. The best strategy would be to shine the spotlight on communities that are doing energy conservation,building green energy generation systems to go Green and save money at the same time.
Real examples of such communities need to be shared, so the residents of other communities can ask their Leaders why are we not doing the same?
The myth that it will cost money should be removed with real examples of transformation to more efficient buildings and shift to renewable energy sources.
Action speaks for itself. We hope that everyone that is taking Leadership in this area is pointed out.
Walmart is no exception in this area even when some union supporting people may not like their wage policies. It is time that news media reports cover such success stories to inform their viewers and readers.
More Jobs Clean environment and reduction of green house gases will be the outcome as we save money to invest in future. Hopefully the energy independent developments and communities will share their stories with their neighbors and encourage them to do the same. County and State governments must support such actions and help others with green financing to achieve similar results.

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Sunday, April 27, 2014

Our Leaders should not be afraid to promote Sustainability & Climate Change initiatives that save Money

Recent news conveys that some Leaders of Countries pushed the Scientists to soften the reality about what Climate change could do to our planet. Final released version of Global Climate change report is only what they wanted to be published.

Unfortunately this type of action only shows how ignorant they are about money savings aspects of many climate change initiatives. Energy Conservation when seriously taken and financed from the operating cost can generate fantastic results for the existing users. Our demand for conventional fuels automatically goes down and help climate change.

United Nations and other Country's Leaders should consider Energy Conservation as the new "Weapon of Mass Benefit". Let us call it "WMB" in contrast with "WMD",  where money is spent to destroy and not create. Why  not help invest in technologies that can save money and create Jobs?

Reality of how Corporate Executives think.. is that top managers are not ready to take risks and push changes that can save money due to perceived risk. What happens if it does not work? We know several industrial waste treatment system that can save them several hundred thousand dollars per year, but they are unable to decide because change is difficult to get Corporate approvals, when it competes with other Capital investments. These same projects may get quick "Yes" if we could offer financing the capital to pay for the change and Client only pays from the annual savings.  Thus they are relieved from taking the financial risk and need not request capital funds from the Corporate HQ. This " shared saving agreement "SSA" is performance based and could be good model to accelerate the adoption of Green Energy Saving technologies.

What is lacking now ,  is the financial institutions that can lend money to Technology providers so they can offer the shared savings agreement (SSA)  to potential customers.  NYS has recently created the Green bank which may be able to play a role to implement such concepts.

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Wednesday, February 19, 2014

Strategy for Faster Implementation of Solar PV projects in Sustainable Green Communities

An Year has gone by as we tried to find a way to help our small communities to find Energy Independence with Power Purchase Agreement (PPA) with a Private Developer who would finance, build and operate the solar PV system. 

This is a great  idea but with no risk comes the delays and uncertainties. Some of the host communities found out that Developer was unable to complete the projects in time due to weak financial support where the investor just backed off from the deal. What should the community do to assure faster and more assured implementation?

We are now following a two step procurement approach that can save money and get better outcome for all parties. It all starts with community education to first build the buy in and desire to go green and make your own power at a suitable site. Study of all of the municipality owned facilities energy consumption is necessary to estimate the current energy use and size the Solar PV system and a site with adequate electrical service to be able to supply excess power to the grid.

The second step is to present the opportunity to financing Companies and get a commitment from them as Proforma PPA based on a projected capital cost of the system. Once the terms of the power purchase agreements are executed then we issue a Request for Proposal to design and build the system from local developer -solar installers. These proposals are evaluated to select the contractor to submit the bid proposal to NYSERDA and get the grant commitment.The final PPA is executed after modifications to take into account the actual capital cost and grant amount. This approach takes away the need for solar PV installers to search for financing partner since the Owner makes this choice at the beginning of the project.

This market needs fast track and simpler process to cut costs and get best value for the communities. 

Go Solar Now. The process is now better and many communities now realize that this is the right thing to do.

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Saturday, February 01, 2014

Taming the Increasing Cost of Energy with Solar PV by Sustainable Communities

Municipal leaders in Upstate NY face challenges of increasing cost of operations and reducing tax base. Fewer tax payers need to support these cost increases. Energy is one of the operational cost elements that can now be reduced by conservation efforts. However as the unit cost of power goes up from 12 cents to 24 cents in next 20 years, what can be done at the present?

Fortunately the cost of Solar PV has come down significantly and Federal and State tax credits or grants help reduce the capital cost to make it affordable. These cost factors have created an opportunity to work with third party developers who can finance the project based on a long term power purchase agreement with the Municipality.

This concept of public private partnership offers a Win Win proposition where the cost of power can be fixed and depends on the level of risks taken by the investors. If the Municipality wishes to take zero risk then they would end up paying more for the cost of power sold to the Municipality.

Some communities can see the benefit of Solar Power and are willing to make some capital contribution as Advance payment toward future purchase of the system after the private party has taken all of the tax benefits including faster depreciation. At this time the system can be purchased at fair market value. Communities willing to invest about 20% of the capital cost at the beginning of the project are finding that they can bring the cost of electricity down to 6-8 cents now and expect to reduce it further to 5-6 cents per kwh after 10 years and lasting for another 25 years for the life of the solar PV system. This is a smart way to control the cost of power for a very long term with small investment at the beginning. Energy Independence is now possible and some leading communities are on their way to achieve it. This approach can make all of their public buildings achieve  Net-Zero electric energy goal.

Good financial planning and consideration of risks should be done as the communities develop a strategy for their energy future. What ever path you take, do start the process and join the fast growing solar power trend based on available incentives in New York.

Good Luck!

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Saturday, January 04, 2014

Financing is key to Sustainable Green CommunityDevelopment

As the new year 2014 starts, we must review what occurred in 2013 and plan strategies that can avoid the hurdles to faster implementation of Green energy programs in New York and other States in America. While we wait for a National investment plan, each State can do what is appropriate for them.

New York has many innovative funding  initiatives but the rate of implementation is still slow because of lack of affordable capital funding to start the projects. Many of these initiatives are justified based on future savings to payback the investment made on the project and ability to achieve energy independence. Unfortunately the traditional financing institutions are reluctant to take risks on new green technologies and private investments are seeking much higher interest rate which raises the costs to the community. So what can be done to help and make better progress?

The publicly funded  Green Bonds offer a great ray of hope to encourage the implementation of Green energy technologies. Funds can be loaned with 5-10 year term at low interest rate and the risk covered by the borrower who has the expertise in new technologies and willing to use these funds to build the systems and payback the loans from the revenues generated by the savings or generation of green energy.

Fortunately, New York has initiated a $ 1 Billion Green Bank to help meet this funding need for Green projects. This initiative results from the Green Vision promoted by our Governor.
We hope it succeeds in making New York lead this transformation to green and clean technology.
Happy New Year!

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