University Park Solar    

A For-Profit Private Membership LLC for Solar Energy

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What is the University Park Community Solar LLC?  

The University Park (UP) Community Solar LLC is composed of a group of town residents and outside experts that recently have set up a solar power generation plant.

Why did the UP Solar LLC try to set up a solar power plant?

Establishing a centralized solar generation site can produce sufficient kilowatt hours (kWh) to gradually replace fossil fuels currently used to provide electrical power from our local utility Potomac Electric Power Company.  (Presently, Pepco's renewable energy sources are only 4.95% of the total.)  Thus, the twin goals of stabilizing our electric rates and reducing our carbon footprint are achieved effectively.  Additionally, solar panels on rooftops do not require transmission or distribution power lines -- solar electricity is produced and consumed at the site.  

How does the Solar LLC work?

As of July 22, 2010, we were successful in setting up a 22.77 kW solar system, which is generating 30,443 kWh/year. The total cost of the project was $130,000.  Our aim was to attract enough members to finance the project, and for members to recoup their contribution as soon as possible with a sufficient return. The members are neighborhood folks and other Maryland residents.  

The UP Community Solar LLC sells the energy generated by the plant under a long-term solar power purchase agreement (PPA) with the host, and also sells solar renewable energy certificates (SRECs) earned from generating renewable energy.  In addition, UP Solar LLC members received benefits from a 30% Federal Tax Credit, a Maryland State Grant, and will be allowed accelerated depreciation deductions.  In fact, because of the American Recovery and Reinvestment Act, we, as a Limited Liability Company, received a 30% cash Federal Grant (in lieu of Tax credits) from the Treasury Department. 

Where is the solar power plant located?

 The University Park Church of the Brethren is our host.  Additionally, a preliminary review of possible future sites is underway.   One exciting possibility is an urban farm structure in Baltimore in partnership with Civic Works



Is placing a solar power plant on roofs safe?

Solar power generation is based on decades-old technology, using silicon-based photo-voltaic cells.  When formed in panels and installed on roof tops, solar cells do add additional load, but engineering studies are required to ensure the integrity of roof supports before installation.

In terms of health effects, silicone-based technology in the form of photovoltaic cells have been in use for over sixty years without any evidence that humans are affected in any way.  In California, dozens of schools are employing solar plants without reporting any negative health consequences.

How are UP residents who do not become members in the LLC benefited by the solar generation plant in their midst?

As stated, our 22.77 kW solar power system is generating 30,443 kWh/year.  The production of solar energy partially offsets the payments we all make to Pepco for our electricity, thus effectively reducing our total energy costs.  And the “green” electrons produced by the solar plant supply the same grid we all depend on for our power.  We need to reduce our dependency on coal which is nearly 55% of Pepco's fuel mix and, in some cases, is mined by a mountaintop removal process for generators located in Pepco's service area.  

How are members benefited from having an interest in the UP Community Solar LLC?

In addition to keeping electricity costs down and  our “carbon footprint” diminished, the revenues from the energy and SRECs sales go to maintaining the solar facility, operating costs such as insurance, and to paying back the capital and a return on capital to members.  That prospective return is an additional benefit exclusively enjoyed by the membership.  See our annual report.

Why not individual households?

Compared the cost of installing a solar system on individual home sites, and taking into account the fact that University Park is located in a forest of oaks, maples and pines, a centrally located solar plant with wide exposure to the sun is by far more efficient.

What exactly are SRECs?

Energy suppliers and electric utilities in some states like Maryland are required to provide a certain percentage of their electricity from renewable energy sources.  They meet these requirements by creating their own renewable energy source or purchasing Solar Renewable Energy Certificates (or credits).  If the supplier or utility does not meet the renewable requirements, they pay a non-compliance fine to state regulatory authorities.  Each time a solar electric system generates 1000 kWh (1 megawatt-hour) of electricity, a SREC is issued which can then be sold or traded separately from the power.  Since a SREC is equivalent to 1,000 kWh, and UPCS's 22.77 kW solar facility is generating 30,443 kWh/year, the LLC is entitled to 30 SRECs.  As a result, our solar system generates SREC revenue streams for members each year. 

How is the price of SRECs determined?

Pepco (our electric utility) is actually part of the much greater regional transmission organization known as PJM Interconnection.  PJM owns and administers the Generation Attribute Tracking System (GATS).  Essentially, the system collects information on all generation resources located in the PJM region, all megawatt-hours produced, and all load served within the PJM region.  GATS creates generator-specific electronic certificates that identify the relevant generation attributes necessary for electricity suppliers and utilities to satisfy state policies and to support voluntary green markets.

As an example, posted on the GATS website, the solar weighted average price per certificate from January 2010 to June 2010 in Maryland ranged from $311 to $360.   We expect sold our SRECs to a buyer within this range and do not deal directly with GATS.  We have contracted with a broker to sell our SRECs.  (The non-compliance fine is statutorily set to $400 in Maryland at the present time.)

What is net metering and how will solar generation affect the host?

Net metering occurs when the solar panels are generating electric energy with the remainder coming from the utility company.  At the present time, the Church’s consumption is less than it needs at any given moment – the excess solar energy is then fed into the power grid.  During the night, this excess energy is returned to meet the power demand of the Church.   The meter between the Church and the grid always measures the net flow of electricity.  

To the extent that the host Church is offsetting its own consumption throughout a year, the Church receives a credit for the solar generation at the Pepco retail rate, i.e., an “in kind” payment.  To the extent the Church has generated more than it consumed at the end of one year, the amount of the generation credit is calculated at the wholesale PJM market price for energy.  In this instance, the Church has agreed that UP Community Solar LLC retains ownership of those wholesale credits.   

The Maryland Public Service Commission’s Net Metering Working Group and the Maryland Energy Administration have recently published A GUIDEBOOK ON NET METERING IN MARYLAND.   

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