proposed business case: public-private partnership€¦ · proposed business case: public-private...

Proposed Business Case: Public-Private Partnership

Community Solar for CTA Heavy Maintenance Facility & Rail Yard

System Owner: Developer

Installation Type: Rooftop/Carport

Subscriber Model: Panel Lease

Host Site Owner: Public Sector

System Size: 1,900 kW

Subscribers 175

September, 2017

CS060 Prairie State College Case Study Cook County Community Solar Project

©Elevate Energy 2016 2

Contents Case Study ..................................................................................................................................................................3

Overview .................................................................................................................................................................3

Business Case Assumptions ....................................................................................................................................3

Site Assessment ..........................................................................................................................................................3

Shading Analysis .....................................................................................................................................................3

Structural Assessment ............................................................................................................................................4

Mounting Stuctures ................................................................................................................................................4

Permitting ...............................................................................................................................................................4

Interconnection ......................................................................................................................................................5

System Design ............................................................................................................................................................5

Panel Layout & Design Considerations ...................................................................................................................5

System Components and Costs ..............................................................................................................................5

System Performance ..............................................................................................................................................6

Operations and Maintenance .................................................................................................................................6

Business Model ...........................................................................................................................................................7

Ownership Structure ..............................................................................................................................................7

Subscriber Model....................................................................................................................................................7

Financial Model ..........................................................................................................................................................7

Inputs & Assumptions ............................................................................................................................................7

Subscriber Metrics ..................................................................................................................................................8

Host Site Metrics ....................................................................................................................................................8

System Owner Metrics ...........................................................................................................................................8

Subscriber Management ............................................................................................................................................9

Customer Acquisition .............................................................................................................................................9

Subscriber Management ........................................................................................................................................9

Marketing & Outreach ................................................................................................................................................9

The Cook County Community Solar Project ............................................................................................................ 10

About the SunShot Initiative ................................................................................................................................... 11



Case Study Overview

The Chicago Transit Authority Heavy Maintenance Facility & Rail Yard in Skokie houses multiple shops on more

than 30 acres. Rail lines connecting the site to the CTA system limit the possibility of ground mounted PV.

However, the building has more than 400,000 sf of roof space and significant parking lots. The proposed

community solar system installation would utilize nearly the entire roof to host 1,128 kW of rooftop solar and

772 kW in solar parking canopies to be installed over the north and south lots. This proposed business case is a

developer-owned model, with the CTA as an anchor subscriber, and the remainder of subscribers coming from

households and businesses from the surrounding community.

Business Case Assumptions

The intent of this proposed business case is to provide a high-level assessment of installing solar at this location

and providing a rationale and proposed model for operating a community solar program. While system designs,

assumptions and costs are provided in this report, they are not intended to serve as construction ready drawings

or designs, financial pro forma or commitments. It is assumed that each site, stakeholder or solar developer will

pursue design, engineering, interconnection and business planning separately and specifically. Neither Cook

County nor any person acting on their behalf (a) makes any warranty, express or implied, with respect to the use

of any information or methods disclosed in this report or (b) assumes any liability with respect to the use of any

information or methods disclosed in this report.

Site Assessment The initial assessment looked at ground mount solar over undeveloped land at the south end of the property.

Research indicated that the land assessed actually was not owned by the CTA. The engineering team then

looked at the roofs and potentially carports at this site. The multiple buildings on this campus represent more

than 400,000 sf of roof space across at least 10 roof segments/buildings. These roofs vary in age and structure. A

number of the roofs are currently in fair condition and would be replaced prior to solar installation. The initial

assessment indicates that the flat roofs are suitable for the addition of solar arrays, while the sawtooth roof may

require reinforcements. Parking lots are suitable for solar canopies if the minimum height can accommodate the

heavy equipment and trucks that are present at the campus.



Shading Analysis

A shading analysis was conducted to

determine the impact of shading on the kWh

output of the proposed PV system. The

HelioScope software program was used to

determine the amount of shading and

corresponding reduction in kWh output. The

results of the analysis indicate that overall

rooftop and carport annual rated kwh

output will be reduced by 1.4%. This system

loss due to shading is incorporated into the

system performance calculated by PVsyst

and informs the overall design.

Mounting Structures

The solar panel roof mounting approach used in this proposed design consists of both direct attachment rails

and ballasted systems. The direct attachment system is proposed for the sawtooth portion of the roof. Special

roof attachment hardware is directly attached onto the underlying roof framing and sealed with flashing and

sealants to maintain a weatherproof building envelope. These attachment points will allow a bracket and rail

system to be used to install the panels flush on the sawtooth portion of the roof.

The approach used for the remainder of the flat roofs is a ballasted system, which precludes the need to pierce

through the roof membrane. Instead the PV panels are attached to trays with ballast weights to secure the

modules and negate the wind uplift effects. Wind deflectors can also be attached to the modules to decrease

the required ballast weight resulting in a system with a total uniform load of less than 6 pounds per square foot

(psf). Applications of the ballasted system are limited to low slope roofs with pitch less than 10 degrees, which

works for this site.

Structural Assessment

Typically, we assume a uniform dead load of 15 psf for steel framing to account for the weight of the roof

framing and roofing material. The additional weight due to typical solar panels and the associated mounting

hardware is in the order of 6 psf. Based on a design roof live load of 32 psf as indicated on the existing building

drawings, structural reinforcements would not be required to support the proposed ballasted system on the flat

roofs of the existing buildings. It is however likely that some secondary steel reinforcement would be required

to attach the PV panels flush on the sawtooth portions of the roof. These reinforcements have been accounted

for in our design and site preparation budget.

Permitting All panels are proposed to be roof or carport mounted for this site. Thus, only building permits are anticipated

to be required.



Interconnection

The CTA site is currently fed from a 3-phase 12kV line supplying power underground to pad-mount transformers

on the property. The interconnection will require the installation of a power transformer, fused disconnect,

relaying, and metering equipment at the point of interconnection. The ComEd distribution system may require

a relay upgrade for the feeder based on the interconnection pre-screen report provided by ComEd. The costs

associated with these upgrades have been included in our design and financial model. However, a full

interconnection analysis will need to be conducted to confirm required upgrades and costs.

The Utility Side of the Meter On the utility side of the meter, a 2,000 KVA power transformer

will be required to step-up the PV solar system voltage to 12kV, as

well as a potential transformer (PT) for voltage monitoring of the

relay. These are both installed on the ComEd side of the meter,

with upfront costs incurred by the utility. The system owner pays

for associated construction and engineering costs, as well as a

monthly fee via the Rider NS agreement, which is typically $200-

$400 per month.

The Customer Side of the Meter The interconnection costs incurred by the system owner include

the relay, fuse switch, distribution panel and the cable/conduit to

connect the PV system to the grid. While the costs for transformers

are incurred by the utility and paid for monthly by the system

owner, the engineering and construction costs are paid for upfront

by the customer. Total interconnection costs are less than the

industry average of $.09 per installed watt.

Customer Side Materials Costs

Relay for DER Protection $1,000

Fused Disconnect Switch $5,000

Distribution Panelboard $15,000

2” Sch. 40 PVC $300

Misc. Bends / Couplers $240

Cable $7,500

TOTAL $26,040

Utility Side Materials Costs

Potential Transformer $400*

2,000 kVA Power Transformer $60,000*

Meter $300*

TOTAL $60,700*

*Rider NS, Not in upfront total

Total Customer Interconnection Costs

Engineering $20,000

Materials $26,040

Construction $120,000

Interconnection Application $2,100

Total $148,140

System Design Panel Layout & Design Considerations

The proposed design incorporates roof-mounted arrays

along with parking lot canopies. The proposed system

uses nearly 6,000 panels in a layout that takes

advantage of most of the available flat roof space in a

non-penetrating, ballasted racking system, as well as

fixed penetrating mounts for the sawtooth roof over the

main garage. The design also uses parking canopies in

small enough proportion to ensure overall costs remain

as close to $2 per installed watt as possible. Costs based

on this design are anticipated to be $2.06 per installed

watt overall. This maximizes output and maintains a

competitive cost.



System Components and Costs The design uses (3,458) 325-watt modules for

rooftop arrays and (2,376) 325-watt modules for

carport arrays. A total of 5,831 modules are used, as

well as 28 small inverters for cost effectiveness and

to minimize the effect of inverter down time. With a

number of small inverters, only a small part of the

system will be taken out of service if there is a

failure. Utilizing 1,000VDC strings allows a larger

number of PV modules per string and reduces cost.

Using 480AC three-phase for power distribution is

recommended to minimize voltage drop.

System Performance PVsyst V6.41 software was used to analyze the anticipated power generation performance of the system based

on the design. PVWatts uses solar irradiance data from the closest possible set of typical meteorological data

(TMY). In this case, the nearest set of TMY for this site is from Midway Airport. Based on this analysis, the system

is anticipated to generate more than 2,378 megawatt hours of energy per year, enough to power about 300

average Cook County homes.

Operations and Maintenance A robust maintenance plan can ensure optimal system performance. The

U.S. Dept. of Energy suggests that an optimal operations and

maintenance (O&M) plan for solar arrays can increase typical

performance from 91% to 95%. The components of O&M include site

maintenance, electrical inspections and panel maintenance. The single

biggest expense for maintaining arrays is inverter maintenance and

replacement. Most inverters have a planned mechanical life of about 10

years, which this model assumes.

Component Costs per Watt Ground Carport Combined

PV Modules: $0.45 $0.45 $0.46

Inverters: $0.13 $0.13 $0.13

Racking: $0.15 $1.00 $0.48

Balance of System: $0.10 $0.10 $0.10

Engineering and Design: $0.02 $0.02 $0.02

Permitting and Interconnection: $0.10 $0.10 $0.04

Installation Labor: $0.40 $0.40 $0.41

Equipment Rental and Freight: $0.03 $0.03 $0.03

Development Overhead: $0.40 $0.40 $0.40

Total Installed Cost $1.78 $2.63 $2.06

O&M Costs $/kW

General Site Maintenance $1.40

Electrical Inspection $2.49

Panel Washing $0.82

Inverter Maintenance $4.08

Inverter Replacement $6.22

Total $15.00



Business Model Ownership Structure

Developer-owned, host-owned and equity investor models were analyzed. The equity-investor model produced

an Internal Rate of Return of just 7.8% before taxes. The host-owned system produced a better overall Net

Benefit over the life of the system, But the IRR was just 3.3%. The developer-owned system produced the best

overall return for both developer with an Internal Rate of Return of 9.9%. The earnings for the host were very

good, as well, and it allowed no upfront investment or risk. The Return On Investment (ROI) for the Developer

for this proposed model is anticipated to be 25.6% and the host site average annual return over was more than

$19,000 annually over the life of the system.

Subscriber Model

The proposed subscriber model is a panel lease model, with the Chicago Transit Authority as an anchor

subscriber. Households and businesses from the surrounding community will take the remaining shares. The CTA

will subscribe to 40% of the system output, or approximately 950,000 kWh annually. They will lease panels for

$1.11 per month, which represents a 10% savings on their electricity rate the first year. Residential subscribers

will lease panels for $1.56 per month each, which also represents a 10% savings. Our model assumes subscribers

lease an average of 20 panels each, requiring about 175 subscribers to reach full subscription. Savings are

anticipated to increase over time as energy prices increase.

Financial Model Inputs & Assumptions

Financial models were developed using the Community Solar Business Case Tool developed by the Cook County

Community Solar project team. Inputs were based on findings from the engineering assessment conducted by

Primera, LLC on behalf of Cook County, solar design outputs from Elevate Energy and Microgrid Energy using

Helioscope and PVSyst, interconnection pre-screening reports from ComEd, as well as industry data for some

inputs identified in cooperation with the National Renewable Energy Laboratory1 and Lawrence Berkeley

National Laboratory2. The Community Solar Business Case Tool version used to develop these financial models is

the Illinois specific tool, which is based on an energy-only residential bill credit rate of $0.0587 per kWh and

average commercial and industrial bill credit rate of $0.035 per kWh. SREC values used were $45.00 per MWh,

based on our assumption of increasing blocks for system size ranges.

1 U.S. Solar PV System Cost Benchmark: http://www.nrel.gov/docs/fy16osti/66532.pdf 2 Tracking the Sun quarterly solar price report: https://emp.lbl.gov/publications/tracking-sun-ix-installed-price

Business Case Tool Version: The tool version used is a customized version of v1.21. All macros were removed and separate rate inputs

were added for C&I/anchor subscribers. The PVWatts rate generator is disabled in this version. To adjust generation rate outputs,

download the latest version here: https://www.elevateenergy.org/community-solar/communitysolarbusinesscasetool/

http://www.elevateenergy.org/community-solar/communitysolarbusinesscasetool/

https://www.elevateenergy.org/community-solar/communitysolarbusinesscasetool/



Subscriber Metrics Subscribers gain value by leasing panels for $1.56 per month and

receiving credits on their electricity bill at an effectively higher rate.

The proposed subscriber model assumes a 10% savings for subscribers

on their electricity rate. While the average number of panels leased is

estimated to be 20, subscribers can lease more or less to

accommodate their electrical load. Subscribers leasing 20 panels will

save $37 their first year and an average of $170 annually over the life

of the system.

Subscribers from households of 80% or less Area Median Income

(AMI) may qualify for an incentive from Illinois Solar For All that we

have estimated to be 50% of the cost of their subscription. These

subscribers will save on average $224 the first year.

Host Site Metrics

As the host site, the Chicago Transit Authority earns value in two ways: first by leasing their land to the system

owner, which we have assumed to be $5,000 per year. They also receive value by subscribing to an anchor share

of 40% of the system and saving money on their energy. In our proposed model, we have assumed no upfront

costs and an immediate net positive experience. Their first year savings is estimated to be $8,078 and their

average annual savings over the life of the system is $19,096.

System Owner Metrics

The proposed business case allows for a developer to build, own and maintain the system, taking advantage of

SRECs at $45 per megawatt hour produced, the federal Investment Tax Credit at 30%, the Modified Accelerated

Cost Recovery System (MACRS) at 35% over six years, as well as the $250 per kW capacity rebate from the

utility. Allowing for a 10% energy savings for subscribers, the system owner sees an Internal rate of Return (IRR)

of 9.9%, a Return On Investment of 25.6% and an overall Net Benefits of nearly $1.4 million.

Unsubsidized Subscriber Metrics

25-Year Costs: (9,360)

25-Year Revenues: 13,604

25-Year Net Benefits: 4,244

Upfront costs $0

Year 1 Bill Savings: $37

Subsidized Subscriber Metrics

25-Year Costs: (9,360)

25-Year Revenues: 18,284


Upfront costs $0

Year 1 Bill Savings: $224

Key Performance Indicator Subscriber

25-Year Costs: (778,708)

25-Year Revenues: 1,256,103


Upfront costs $0

Payback Period: 0

First year savings $8,078

Average Annual earnings over 25 years: $19,096

System Owner Metrics

25-Year Costs: (5,436,598)

25-Year Revenues: 6,826,652

25-Year Net Benefits: 1,390,054

25-Year Net Present Value (NPV): 180,194

Return on Investment (ROI): 25.6%

Payback Period: 4.2

Internal Rate of Return (IRR) 9.9%



Subscriber Management Customer Acquisition The proposed business case calls for approximately

175 subscribers leasing an average of 20 panels

each. It is anticipated that the customer acquisition

effort is moderate for this project and that full

subscription will be reached within one year. The

average cost for customer acquisition is $431 per

subscriber during the first year.

The turnover rate of subscribers is estimated to be 1.5% per year. This turnover represents subscribers that

move out of the utility territory or cancel their subscription. Customer acquisition for these subscribers is then

required to bring the project back to full subscription.

Subscriber Management

The management of billing is the largest ongoing subscriber management

function anticipated. This will consist largely of managing share percentages

monthly and providing breakdowns for the utility in a timely manner.

Reconciling billing discrepancies can be an issue in the early stages of any

community solar project. This, together with customer service and general

program questions makes up the biggest share of subscriber management

costs in the first two years after customer acquisition. After the second year,

subscriber management costs lessen and the tasks become routine.

Marketing & Outreach The Village of Skokie has a population of 64,270. However,

the number of households within 5 miles of the facility is

more than 290,000. This represents a densely populated

suburban area. Because the subscriber model and terms are

very positive and because the Chicago Transit Authority can

easily support the marketing, outreach and subscriber

acquisition efforts through its ridership, the acquisition for

the 175 needed subscribers should be a fairly simple task.

We have anticipated reaching full subscription within a year.

There are a number of innovative approaches the CTA can

take to support the customer acquisition for this developer,

including outreach and co-marketing on buses and trains, as

well as internal to employees.

Total Upfront Administrative Costs Total ($) $/Subscriber

Marketing & Communications $27,323 $156

Customer Acquisition Setup $9,900 $56

Outreach Setup $2,400 $14

Admin Setup $1,400 $8

Year 1 Subscriber Management Costs $34,642 $198

TOTAL UPFRONT COSTS $75,665 $431

Lifetime Subscriber Mgt. Costs

Outreach $4,860

Sales $895

Sign-up Transaction $639

Customer Service $5,935

Billing Admin $358,676

TOTAL COSTS $371,005



The Cook County Community Solar Project Project Background

The Cook County Community Solar Project was launched in early 2015 with a grant from the Department of

Energy’s Solar Market Pathways Program. This two year project began on the premise that community solar was

not only possible in our region, but has the potential to bring access and equity in renewables to the 80% of our

population currently left out because of technical, structural or financial barriers. Community solar also has the

potential to bring significant economic development to the region, with more than 600 MW of community solar

development projected in Illinois through 2030 after the launch of the Future Energy Jobs Act in June of 2017.

Project Partners, including Cook County, Elevate Energy, the Environmental Law & Policy Center, The City of

Chicago, ComEd and West Monroe Partners, have produced a series of reports, analyses and tools that are

aimed at supporting stakeholders to grow the emerging community solar market in our region. Project

deliverables include an opportunity assessment, policy analysis, best practices, value and impact analysis and a

series of 15 site-specific project case studies, in which this document is one. More on the project and

deliverables can be found here: https://www.cookcountyil.gov/service/solar-energy

Key Project Contacts Deborah Stone Project Sponsor Chief Sustainability Officer and Director Cook County Department of Environmental Control [email protected]

Vito Greco Project Lead Solar Program Manager Elevate Energy [email protected]

Laura Oakleaf Project Manager Legislative Coordinator Cook County Department of Environmental Control [email protected]

https://www.cookcountyil.gov/service/solar-energy

mailto:[email protected]





About the SunShot Initiative The U.S. Department of Energy SunShot Initiative is a collaborative national effort that aggressively drives

innovation to make solar energy fully cost-competitive with traditional energy sources before the end of the

decade. Through SunShot, the Energy Department supports efforts by private companies, universities, and

national laboratories to drive down the cost of solar electricity to $0.06 per kilowatt-hour. Learn more at

energy.gov/sunshot.

This material is based upon work supported by the U.S. Department of Energy under Award Number DE-

EE0006916.

This report was prepared as an account of work sponsored by an agency of the United States Government.

Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty,

express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness

of any information, apparatus, product, or process disclosed, or represents that its use would not infringe

privately owned rights. Reference herein to any specific commercial product, process, or service by trade name,

trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement,

recommendation, or favoring by the United States Government or any agency thereof. The views and opinions

of authors expressed herein do not necessarily state or reflect those of the United States Government or any

agency thereof.

All photos courtesy of the National Renewable Energy Laboratory’s Image Gallery

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