By TIM FAULKNER/ecoRI News staff
RICHMOND, R.I. — There was a bit of give, especially with taxes, before the construction of a 2-acre solar project in an industrial park near Interstate 95 was approved.
First, the Town Council approved a hefty cut for the project’s tax bill, restructuring what is called tangible asset tax from about $30,000 to a $3,750 per year flat fee for 12 years. In addition, Nexamp, the owner and developer of the project, also pays property taxes and a fee to lease the land from a local property owner.
During the May 20 ribbon-cutting ceremony for the 500-kilowatt project, officials said the solar array’s best attribute is that it serves as a real-life laboratory for students at Chariho High School.
“One of the biggest issues here was the tie-in to education,” Town Council president Henry Oppenheimer said. “The town will get its tax revenue, it will be clean, renewable energy, the kids at Chariho will learn about asset development. They will have the advantages as they go forward.”
During construction, students visited the site to learn about engineering and erosion. Now that it is built, classes will study renewable energy, electrical engineering and the economics behind making solar projects financially viable.
“You can’t duplicate (these concepts) in the classroom. You can only duplicate them in real life,” Chariho School District superintendent Barry Ricci said.
Marion Gold, commissioner of the state Department of Energy, said teaching about renewable energy helps build careers. “There are a lot of clean-energy jobs but there is a real need for training workers of the future so that they get the skills they need,” she said. “So it’s really great that you are getting the kind of hands on experience with this project.”
Oppenheimer noted that there are environmental benefits as well. In the late 1970s, he wrote business plans for oil development companies while he taught finance at Texas Christian University in Fort Worth, Texas. The oil was so abundant wells were pumping in the city. With solar energy, he said, there is little risk of pollution, accidents and abandoned equipment that comes with oil busts.
“But this (solar array) will be here for 20 to 30 years,” he said.
New solar incentives
Part of the financing for the Richmond project came through a state program that allows a fixed-price purchase agreement for the electricity.
Through the state-sanctioned distributed generation (DG) program, Nexamp received a price purchase agreement of about 19.5 cents per kilowatt-hour for 15 years. This fixed pricing allows Nexamp to project a long-term revenue stream that makes the project profitable for the business and attractive to lenders and investors.
The DG program branched out this year to include fixed pricing for solar systems suited for homes and businesses. Solar companies see it as a great deal for customers and the industry.
“I am looking forward to the residential program launching because we have several people signed up for it already,” said Doug Sabetti, owner of Newport Solar, an installer of mostly smaller solar arrays for homes and commercial customers.
The new solar energy program, called Rhode Island Renewable Energy Growth, opens June 15. Enrollment forms for the program were posted June 1.
A revamped and expanded DG program for wind, hydropower and larger solar begins with a two-week enrollment Aug. 3 and a second enrollment Oct. 19.
The California-based solar company made famous by it financial backer and largest shareholder, Elon Musk, now offers a low-cost solar loan program in Rhode Island. The MyPower loan is available in Coventry, Cranston, Cumberland, East Providence, Johnston, North Providence, South Kingstown, Warwick, West Warwick and Woonsocket. Other communities are expected to follow.
Rhode Island is the fourth state in New England and the 18th in the country were SolarCity operates.
The new loans typically require no upfront cost and are repaid by the electric customer. The payment is typically the same amount or less than the monthly electric bill. Unlike a lease program, the property owner owns the solar array purchased with a MyPower loan.
SolarCity recently announced the opening of a new sales and support center in Fall River, Mass. It’s expected to staff 80 employees.