SOUTHWICK – The Board of Selectmen signed an agreement with Nexamp this week to purchase net metering credits.
The town and Southwick-Tolland-Granville Regional School Department are entering the agreement to collectively purchase up to 50-percent of net metering credits from a solar photovoltaic project.
Beth S. Greenblatt, managing director of Beacon Integrated Solutions, met with the board this week to talk about the project and what Nexamp offered the town and schools. Town Counsel Daniel M. McKellick also weighed-in on the agreement.
Greenblatt offered a regulatory update and said net metering is the process of measuring the difference between the electricity generated by the solar photovoltaic array and delivered to EverSource Energy, and the electricity consumed by the customer.
Virtual Net Metering is a financial transaction whereby solar energy delivered to EverSource Energy is monetized and credited to a series of end-user accounts.
Greenblatt said state law currently requires investor-owned utilities to buy renewable energy generation until the total installed capacity of net metered systems reaches five-percent of peak demand for public sector projects and four-percent of peak demand for private sector projects. EverSource has available capacity of 21 megawatts in the public sector, and 20.7 megawatts in the private sector.
The Investment Tax Credit provides a 30 percent federal tax credit for solar systems installed by Dec. 31, 2016, after which it drops to 10 percent.
“So we’re going to see a flurry of solar arrays next year,” said Greenblatt.
Nexamp is developing and constructing three solar photovoltaic arrays in EverSource Energy’s service territory in Hadley, Hatfield and Whately, all of which are Community Shared Solar Systems (CSSS).
A CSSS is hosted by no more than two entities able to use up to 50 percent of annual generation – in Southwick they are the town and school department.
Greenblatt said the balance of the solar generation is sold to businesses and residents in the community, which is anyone in the same utility service territory and load as the host.
The Nexamp agreement gives Southwick an overall savings of 16 percent.
“It’s a pretty good deal,” Greenblatt said.
Greenblatt said the average two-year cost for energy for the town is $299,473 and $255,758 for the schools. Her conservative estimate of discounted net metering capacity value for the town is $254,552 and $217,394 for the schools. The town’s allocated net metering credits from Nexamp in dollars is $162,034 and $162,012 for the schools.
The available net metering credits in kilowatt hours for the town is 867,330, and 519,188 for the schools.
Greenblatt said Nexamp chose to be a CSSS because it maximizes its benefits and soar renewable energy credits.
Greenblatt’s analysis projects a one-year savings of $25,925 to the town and a 20-year savings of $451,073-$543,632.
McKellick said the agreement includes several protective measures for the town and schools, including having the language center around kilowatt hours and negotiating a cap of 115-percent.
“In this agreement we have protective measures for the town that it they terminate without cause – such as an act of God – the town will get $8,500 of its costs for legal fees and other costs,” said McKellick.
The agreement includes other financial protections for the town and school district.
The Board voted unanimously to enter into an agreement with Nexamp.
