Peninsula Clean Energy is embarking on an ambitious program to install solar and storage throughout its service territory, made possible by taking advantage of the direct pay benefits in the Inflation Reduction Act Congress passed last year. It will initially pay for the installations through self-financing.

Peninsula, a community Choice Aggregator, has executed 20-year power purchase agreements with the San Mateo County Human Services Agency Center in Redwood City plus nine cities (listed below). The project was approved by Peninsula’s Board of Directors in January, 2023, at a cost not to exceed $10 million.

Peninsula has contracted with Intermountain Electric Company, selected through a competitive process, to install and maintain 1.7 MW of solar power on 12 public buildings in the cities and county under an engineering, procurement and construction contract. These systems, to be completed by the first quarter 2024, are expected to deliver $17 million in lifetime energy savings to them.

The design and engineering firm, McCalmont Engineering is completing the initial solar and storage designs on the 12 public buildings already selected. Battery storage will be added at several sites that do not have existing backup generators, according to Darren Goode, Peninsula’s media manager.

Later, additional storage units will be deployed when and if they can be grandfathered into Net Energy Metering 2.0, the tariff which current customers use. NEM 3.0, which apply to new solar installations, would reduce the economic value of the solar systems being installed here.

Peninsula is paying for the construction of the project itself directly from its cash reserves. It will take advantage of direct pay benefits included in the federal Inflation Reduction Act. The investment tax credit contained in the IRA is currently at 30% of cost. Peninsula expects to recover 30% of the money spent via the tax credit.

Darren Goode said the remainder of the construction costs will be paid back through the power purchase payments from the cities and county over the 20-year lifetime of the PPAs.

The advantage for Peninsula and its customers is the arrangement lowers power purchase prices and increased energy savings for the cities’ and county facilities with the installed projects.

Peninsula Clean Energy CEO Jan Pepper was quoted in the April 18 press release saying “We want to do everything we can to bring more renewable power online. With this innovative program, we take the burden of solar and storage project development off of city and county staff and achieve cost reductions through scale,”

The cities which have signed power purchase agreements with Peninsula are Atherton Town Hall; Brisbane Mission Blue Center; Colma Community Center; Hillsborough Public Works Yard; Los Banos Community Center; and Wastewater Plant; Millbrae Town Center complex and Recreation Center; Pacifica Community Center; San Bruno Aquatics Center; and the San Carlos Youth Center.

Peninsula said a second round is already underway in which it has completed designs and interconnection applications for an additional 40 sites across its territory.  Approximately 15 MW of solar and potential battery storage systems will benefit additional customers.

Peninsula said it is on track to deliver 100% renewables by 2025.