Energizing The State's Solar Industry
On February 17, 2009, Congress passed the American Recovery and Reinvestment Act (ARRA). As part of this Act, the U.S. Department of Energy awarded $55,447,000 to the State of Arizona. Governor Jan Brewer designated the Arizona Department of Commerce -- Energy Office as the administrative agency for these funds.
Of the nearly $56 million sent to the State of Arizona for energy projects, state officials dedicated 57 percent of the total to renewable energy projects. Most of the recipients of this funding were required to provide matching funds and as a result another $52 million in private capital was invested in these Arizona projects.
The Energy Office directed these funds into six different market titles:
- Energy Efficiency & Renewable Energy Schools Grant Program
- State Buildings Energy Efficiency Program
- 21st Century Renewable Energy Grant Program
- Distributive Renewable Energy Leadership Program (a partnership with Arizona utilities to increase renewable energy installations)
- Agricultural Renewable Energy Conversion Incentive Program
- Manufacturers Energy-Efficiency Grant Assistance Program
There were 642 renewable energy projects funded through the plan. Of this total, 472 were photovoltaic (PV) projects with an installed capacity of 5.287 Megawatts. There were 168 solar hot water systems installed, one solar day-lighting system, two combined heat and power projects and a handful of wind projects.
Below we provide a closer look at these projects that were implemented in Arizona between 2009 and 2012.
- Eighty-nine schools installed PV systems under the plan -- which targeted the smallest schools in the state in an effort to bring clean electrons to districts that had no other way to fund solar production at their schools. These projects not only put people to work, but over the 20-year life of these systems, electricity valued at over $5.7 million will be produced -- saving money for the schools and taxpayers.
Projects like the one at Tonto Basin Elementary School -- where solar energy is saving the 72-student school between 50 to 75 percent on its electricity bill. Or, the solar project at Skull Valley Elementary School that is saving more than $300 annually in energy costs for each of the school's 24 students. That is $300 in avoided energy costs per student.
It is a story that was repeated throughout the state, from Apache Elementary School in Douglas to Hackberry Elementary School in Kingman, Bicentennial High School in Salome to Beaver Creek Elementary School in Rimrock. Bouse, Bowie and Black Canyon City. The list goes on. Pearce, Picacho and Pine Strawberry. Even Yarnell, Young and Yucca.
- Through a matching grant program, 41 farmers and ranchers installed 50 renewable energy systems to replace gasoline and diesel generators used to pump water for livestock, crops and fruit trees.
The grant funding provided $885,374; the farmers and ranchers provided $519,299, for a total project cost of $1,404,673. Today, these projects are saving over 30,000 gallons of gasoline, 37,242 gallons of diesel, 9,820 gallons of propane and producing 271,350 kilowatt-hours (kWh) of electricity annually -- saving each farmer and rancher on average nearly $8000 every year. These projects have typical payback periods under five years, and some recouped the investment in as little as two years.
Projects like a solar-powered water pump at the Cold Creek Ranch in the Mogollon Rim Country. The 10,000 acre working cattle ranch used the federal funds to convert a diesel-generator that powered a livestock water pumping system to a solar water pump manufactured in Safford, Arizona. The Griffin Cattle Ranch near Globe also installed solar-powered water pumps at three locations on its ranch to water livestock. The Howard Thomas Ranch, near Taylor, used grant funding to install three 2.6 kW wind turbines that were manufactured in Flagstaff. The off-grid wind systems are producing 21,600 kilowatt-hours a year for ranch operations.
One rancher commented that without the matching grants funds -- he would have gone out of business.
In addition to the benefits to ranches like the Bar X, Campstool, and Date Creek, these projects are demonstrating that anywhere well water pumping is needed and grid electricity is not available, that solar water pumping can get the job done in an economical way using a product manufactured in Arizona.
- Fifty-one non-profit entities were awarded funding to incorporate renewable energy systems into their operations with annual savings estimated at $175,252.
The Southern Arizona Red Cross in Tucson was able to leverage $162,970 in charitable donations and utility rebates with a $50,000 federal grant to install a 40 kW PV system on its roof. The system provides between 80 and 85 percent of their electricity needs, making it the first "solarized" Red Cross in the nation. In the spirit of bi-partisanship, Governor Jan Brewer and Congresswoman Gabrielle "Gabby" Giffords spoke at the dedication ceremony on September 21, 2010.
The Boys and Girls Club in Phoenix and Sierra Vista also received grants that resulted in solar installations. The Cave Creek Museum, Chandler Christian Community Center and the Easter Seals in Tucson joined the likes of St. Vincent de Paul, St. Mary's Food Bank and St. Matthew's United Methodist Church in benefitting from federal funding made possible by the Recovery Act to add solar to their operations.
St. Vincent de Paul Executive Director Steve Zabliski was quoted as saying that their solar day-lighting system allowed them to divert money that used to go to utility bills to provide more services for Arizonans in need. By turning off their lights in their warehouse during the day, the charity has been able to save more than $14,000 a year in electricity costs.
- Recovery Act funds were used to demonstrate a number of renewable energy products manufactured in Arizona.
NEST Energy Services manufactures a mobile hybrid power trailer that combines solar PV panels, batteries and fossil fuel generators for use in remote locations beyond the power liners. The grant allowed them to demonstrate their product through equipment loans to military and law enforcement agencies. Because of this arrangement, NEST landed contracts with the USMC, US Navy, USAF and the US Army as well as sales to Bechtel, Ledcor and Watts Construction.
SunPumps Inc. of Safford manufactures solar water pumps and controls. Recovery Act funds and matching funds from the City of Safford and the Town of Thatcher resulted in a 58 kW PV system to assist in powering a 50 horsepower pump to supply water to Safford and a 40 kW PV system to power pumps at a wastewater treatment facility in Thatcher.
- Federal funds also allowed the Arizona State Land Department to develop a GIS system to evaluate whether a parcel of state-owned land is a good candidate for utility-scale renewable energy development. This system has not only allowed State Lands to complete a number of transmission studies that have helped fast-track proposed renewable projects on state lands, but it also led to the first-ever solar facility built on state land. A 400-acre parcel of state land in Yuma became home to a 35 MW solar plant as a result of a 35-year lease for the land with APS that will net the state $10 million. The lease proceeds will primarily to go help fund Arizona public education.
- Trico Electric Coop partnered with Solon Corporation and Schletter to put federal funds into a 227 kW, ground-mounted solar PV system adjacent to their headquarters in Marana. This system was an early example of a utility community solar farm that allowed businesses and homeowners to purchase solar produced electricity from the utility. It also incorporated products manufactured by Tucson-based Solon and Schletter.
Schletter was also able to complete a plant expansion for its PV racking and support system manufacturing products using additional federal funds under a Recovery Act grant from the state.
- Recovery Act funds were used to purchase equipment to expand Fluidic, Inc, an Arizona manufacturer of battery cell components.
- Prism Solar Technologies in Tucson used the federal funds to install new production equipment to manufacture solar film.
- Federal funds were provided to eight utility companies throughout the state for additional renewable energy projects like an APS project that resulted in 2 kW PV installations on 30 apartments for low-income seniors in Eloy. The systems have reduced the resident's utility bills by 50 to 75 percent. Eight other apartment complexes in other parts of the state were outfitted with 143 renewable energy systems for the benefit of their low-income residents.
APS also used the federal funds to demonstrate PV technologies at highly visible locations like the Arizona Science Center, City of Surprise Public Library, Tempe Beach Park and the City of Yuma Civic Center.
UniSource Energy Services used the federal funds to work with non-profit organizations in their service territory to install solar hot water systems on 30 low-income apartments and to install two commercial solar hot water systems at two non-profit facilities that provide services to developmentally disabled adults.
Tucson Electric Power utilized the federal funds to install 79 solar hot water systems for residents living at low-income apartment complexes and at transitional housing for homeless veterans.
Trico Electric Cooperative put federal funds into a rebate program that funded 71 residential PV systems with a total capacity of 453 kW and 44 solar hot water systems.
Sulphur Springs Valley Electric Cooperative in southeastern Arizona converted the federal funds into rebates for 12 commercial PV installations totaling 262.5 kW of system capacity. Rebates went to four farms, one ranch, the Sierra Vista Boys and Girls Club and the Arizona Audobon Society.
Southwest Gas put their federal funds into incentives that allowed a hospital to install a 540 kW Combined Heat and Power (CHP) system, and a hotel to install a 100 kW CHP system.
SRP employed in-house staff to install PV systems at 13 schools in their service territory, reducing energy costs by an average of $2300 per school. Additional Recovery Act funds were used to install 48 PV systems on group homes for individuals with special needs.
Mohave Electric Cooperative used the federal funds to install PV systems on 14 K-12 schools and other government buildings like the City Hall complex in Bullhead City, a Bullhead City Fire Station and Mohave Community College.
- Nine state government facilities located in Phoenix, Tucson and Sierra Vista were outfitted with rooftop PV systems. The nine systems have a combined capacity of 650 kW and should offset electricity purchases by the State valued at more than $120,000 each year.
The State didn't direct all of its Recovery Act funds towards renewable energy projects. A total of $15.3 million in grants leveraged $36.4 million in other funds that 31 school districts district used to implement energy efficiency projects that are saving schools and taxpayers $6.9 million per year in utility costs. Most of the schools used a procurement method called Energy Savings Performance Contracts that guarantees the energy savings which are then used to re-pay the costs of the improvements over time.
- Energy improvements at Higley USD are saving more than $150,000 a year on a $1.6 million project that will pay for itself using an ESPC.
- Winslow Schools is saving nearly $200,000 a year in energy costs from improvements costing $1.4 million. The energy savings will pay for the improvements in seven years.
- Tucson USD implemented $2.9 million of energy projects in 15 schools using $878K in federal grants funds -- savings an estimated $462,182 a year in utility costs.
- Federal funds were used by Thomas USD as leverage for an Energy Savings Performance Contract to complete a lighting retrofit with a 4-year payback.
- Douglas USD implemented energy improvements in 14 schools through a seven-year ESPC that is paying for itself with annual savings of $233,894.
- Pinon USD entered a ten-year $1.7 million ESPC that is guaranteed to save the school $169,866 a year in utility costs for 4 schools.
- Energy improvements funded through the plan and an /ESPC at Roosevelt USD are projected to save $400,000 a year in utility costs.
- Dysart USD performed energy improvements in 23 schools – turning a $1 million Recovery Act grant into a $4million performance contract that is guaranteed to save the district $1 million a year in energy costs.
- Chinle USD (Navajo Res.) leveraged its $1m Recovery Act grant into $3.4 million in energy improvements through an ESPC that is saving $309,317 a year in utility costs.
- Sierra Vista USD’s performance contract leveraged a $400,000 grant into a $1.3 million energy retrofit project that is saving the district and taxpayers $212,185 a year in energy costs.
- Tuba City USD completed energy improvements in eight schools that have an estimated annual savings of $232,213 and a 9-yr payback.
- Gilbert USD implemented energy improvements in five schools with an ESPC funded in part by federal grant that has a 9-yr payback.