it don’t mean a thing without good marketing!! · marketing solar . for agricultural uses. it...
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Marketing Solar for Agricultural Uses
It Don’t Mean a Thing Without Good Marketing!!
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MY AGENDA
Survey of agricultural uses
Economics – case studies
Marketing solar in Minnesota
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Energy Harvest Group
Solar thermal for agriculture
Distributed energy storage
Urban Solar Farm for Peak Power
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Industrial process heatAgricultureCommercial hot waterDomestic hot water
Not space-heating !!
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5Monthly DHW Load
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Stock wateringElectric fencingEmergency powerElectric grid support
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The Two Sides of Solar
ReducesReducesDemandDemand
ProducesProducesEnergyEnergy
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Solar Thermal vs. PV comparison
Solar Thermal
50 – 75% Efficient
Photovoltaics
17-23% Efficient
Solar Thermal is my first choice!
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Reliability
4.6 Megawatt AZ Solar Electric Plant
Online since 2002Availability 99.72%No onsite staffRemotely monitored
Annual maintenance cost 0.16% of installed cost
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The Guts of a SystemThe Guts of a System
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Intention planningStructural engineering first!!Keeping it in the budget Incentives & Financing toolsPreparation for “Phase II”
Streamline the GANTT chart
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Solar Energy is variable
PrimaryFossil Fuel is stored
Backup
Solar Energy is our PaycheckFossil Fuel our Savings Account
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Stock Watering
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PV Tracker
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Wool-drying19
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Bavarian Farmhouse20
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Utilize the Roof space !!
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BARN VENTILATION
Lumber Drying
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23Residential SDHW & PV
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Weekday Water Usage
12:00 AM 6:00 AM 12:00 PM 6:00 PM 12:00 AMTime of Day
Hot
wat
er u
sage
Single Family HomeApartment Building
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8 each 4’ X 10’ collectors and racks
$18,000
Hardware & plumbing $ 3,000
2 each 120-gallon storage tanks
$ 2,500
Heating plant tie-in $ 3,000
Engineering & Labor $ 6,000
Total $32,500
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Solar Energy
High front-end cost
Long life of product
Low maintenance
No fuel costs !
Fossil Fuel
Low front-end cost
Shorter life
Higher maintenance
Consumes fuel
Replacement cost!
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simple payback = Front-end cost
Yearly savings
but consider:
energy price inflation
incentives
depreciation
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Assumptions (Inputs) Annual Cash Flow ModelTotal Installed Cost ($): $32,500
Allocation to Business (%): 100 Year Net O&M Net Net Loan Annual Total
Annual Therms Saved: 800 Energy Costs Depreciat. Payments Cash Flow Cash FlowPrice/ therm ($) $1.0000 0 ($17,718) ($17,718)
Energy Inflation Rate (%): 7Loan Down payment (%): 100 1 $800 $0 $2,383 $0 $3,183 ($14,535)
Down Payment ($): $32,500 2 $856 $0 $1,430 $0 $2,286 ($12,249)Amount of Loan ($): $0 3 $916 $0 $858 $0 $1,774 ($10,475)
Interest Rate (%): 4 4 $980 ($250) $858 $0 $1,588 ($8,887)Loan Term (Years): 5 5 $1,049 $0 $429 $0 $1,478 ($7,409)
Month Installed: 0 6 $1,122 $0 $0 $0 $1,122 ($6,287)Net Federal Tax Rate (%): 30 7 $1,201 $0 $0 $0 $1,201 ($5,087)
Net State Tax Rate (%): 8 8 $1,285 ($270) $0 $0 $1,015 ($4,072)O & M Cost ($/therm): $0.020 9 $1,375 $0 $0 $0 $1,375 ($2,698)
O & M Inflation Rate (%): 2 10 $1,471 $0 $0 $0 $1,471 ($1,227)Utility Rebate (%): 10.00 11 $1,574 $0 $0 $0 $1,574 $347
State Tax Credit (%): 0 12 $1,684 ($1,300) $0 $0 $384 $731Federal Tax Credit (%): 30 13 $1,802 $0 $0 $0 $1,802 $2,533 Basis for Depreciation $19,600 14 $1,928 $0 $0 $0 $1,928 $4,460
15 $2,063 $0 $0 $0 $2,063 $6,523
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Assumptions (Inputs) Financed Cash FlowTotal Installed Cost ($): $30,000
Allocation to Business (%): 100 Year Net O&M Net Net Loan Annual TotalAnnual Therms Saved: 850 Energy Cost Deprec. Payments Cash Flow Cash Flow
Price/ therm: $1.0000 0 ($2,079) ($2,079)Energy Inflation Rate (%): 7
Loan Downpayment (%): 25 1 $850 $0 $2,554 ($4,826) ($1,423) ($3,502)
Down Payment: $7,500 2 $910 $0 $1,532 ($4,826) ($2,385) ($5,886)
Amount of Loan: $22,500 3 $973 $0 $919 ($4,826) ($2,934) ($8,820)
Interest Rate (%): 4 4 $1,041 ($250) $919 ($4,826) ($3,116) ($11,936)
Loan Term (Years): 5 5 $1,114 $0 $460 $0 $1,574 ($10,362)
Month Installed: 0 6 $1,192 $0 $0 $0 $1,192 ($9,170)
Net Federal Tax Rate (%): 30 7 $1,276 $0 $0 $0 $1,276 ($7,894)
Net State Tax Rate (%): 8 8 $1,365 ($270) $0 $0 $1,095 ($6,799)
O & M Cost ($/therm): $0.020 9 $1,460 $0 $0 $0 $1,460 ($5,339)
O & M Inflation Rate (%): 2 10 $1,563 $0 $0 $0 $1,563 ($3,776)
USDA & Utility Rebates (%): 30.00 11 $1,672 $0 $0 $0 $1,672 ($2,104)
State Tax Credit (%): 0 12 $1,789 ($1,300) $0 $0 $489 ($1,615)
Federal Tax Credit (%): 30 13 $1,914 $0 $0 $0 $1,914 $300
Basis for Depreciation $21,000 14 $2,048 $0 $0 $0 $2,048 $2,348
15 $2,192 $0 $0 $0 $2,192 $4,540
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Space Heat and SDHW
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26 4x10 panelsContractor
$ 50,000
Hardware & plumbing $ 3,000
450-gallon storage tank $ 2,000
DHW and Furnace tie-in $ 3,000
Admin & Engineering $ 4,000
Labor $10,000
Total $72,000
Solar Thermal – 1200 SF
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Large Commercial System
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Commercial Grid Tie200 each, 200 watt collectors and racks and blocks
$ 235,000
Hardware & wiring parts $ 25,000
Inverters $ 20,000
Crew & Electrician Labor $ 60,000
Engineering & crane $ 10,000
Total $ 350,000
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Price of Solar Electricity
Amortized Cost = Total cost
Total production
Over 25 years = $350,0001,300,000 kwh
Raw Cost = 27¢ /kwh
Subsidized Cost = 13¢ /kwh
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Product or service
Local manufacturing !!
Market researchLook for Opportunities Improve the economics
Government support
Utility support
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Solar Skies MFG is the Midwest’s Leading manufacturer of Solar Thermal Collectors
Solar Skies is located in West Central MN in the town of Starbuck.
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Farmers & ranchersFood industryAnimal handlersBankersHVAC contractorsElectrical contractors
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Build awareness
RE on Schools
Contractor trainingMinimize risk for banksLocal expertiseBuild business modelsCreate green jobsLocal vs. International
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Contact Us At:Minnesota Renewable Energy Society2928 5th Avenue SouthMinneapolis, MN 55408
Phone: (612) 308-4757General Info E-mail: [email protected]: www.MNRenewables.org