A-1. Discussion Regarding Community Solar Gardens IOW
MEMORANDUM
CITY OF TO. Todd Gerhardt, City Manager
CHANHASSEN FROM Paul Oehme, Dir of Public Works/City Engineer
7700 a Box tBoulevard DATE: May 11, 2015 ®�
47
Chanhassen,MN 55317 SUBJ Discussion Regarding Community Solar Gardens
Administration
Phone 952 2271100 In 2013 the state legislator passed a requirement that Xcel Energy increase solar use of its
Fax 952 2271110 power generation to 1.5%of its total electrical output by 2020 and as much as 14%by
Building Inspections 2030. This legislation was designed to jump start the state in using solar energy The
Phone 952 2271180 Public Utility Commission then set regulations for solar use in November, 2014 which is
Fax 952 2271190 the Community Solar Garden Program
Engineering The Community Solar Garden Program can lock in rates for energy use for over 25 years
Phone 952 2271160 A solar garden is a collection of solar panels that would collect the solar energy and
Fax 952 2271170 convert it into power generation and be connected to the power grid. In order to take
advantage of this program, an agency would need to contract with a solar garden vendor
Finance so the solar garden can be constructed A solar garden cannot be larger than 1 MW
Phone 952 2271140 output Solar gardens are proposed in Carver County and in adjacent counties by several
Fax 952 2271110 vendors In exchange for an agency purchasing the power,the solar garden vendor would
receive federal credits and Xcel Energy funds as a subsidy to pay for the capital cost to
Park&Recreation construct the solar garden, operations, and maintenance Any one agency cannot own
Phone 952 2271120 more than 400/0 of any one solar garden output
Fax 952 2271110
The City spends approximately$660,000 annually for power with Xcel Energy or 1,844
Recreation Center kw of power In order for the City to obtain 100%of its energy needs from solar, it
2310 Coulter Boulevard
Phone 952 2271400 would need to contract with 10 community solar gardens This could be one solar vendor
Fax 952 2271404 or several vendors. To date, there have been no community solar gardens approved
through the Xcel Energy interconnection process. The agency also pays the solar garden
Planning& vendor directly for the ownership portion of the community garden output. It is
Natural Resources estimated the City could save up to 5% ($30,000-$35,000) of the electrical costs annually
Phone 952 2271130 if 100% solar usage were obtainable through the state subsidies and contracts with the
Fax 952 2271110 solar vendor are favorable. This percentage would increase over time as utility rates
increase since the solar utility rate is locked in. The City has seen about a 4% increase in
Public Works electrical rates over the past several years
7901 Park Place
Phone 952 2271300 Currently, solar power is one of the most expensive electrical powers to generate. While
Fax 952 2271310 coal and natural gas generations costs about 3 cents to generate per kilowatt, solar
Senior Center currently costs about 12 cents To subsidize the solar rate and make it attractive for
Phone 952 2271125 agencies to sign up for, non-solar customers will be paying for the subsidies with higher
Fax 952 2271110 utility rates For this reason, the Minnesota Chamber of Commerce has opposed the
Community Solar Garden Program in its current format
Website
www ci chanhassen mn us If the City Council wishes to move forward, the next step would be for staff to work with
a consultant to send out requests for proposals to solar power vendors This work would
take about 80-100 hours of staff time to coordinate with no guarantee of receiving
funding
g\eng\paul\memos\bkgd ws 051115 solar garden doe
Chanhassen is a Community for Life-Providing for Today and Planning for Tomorrow