Solar Roofs in San Diego

• By Thomas G. Dolan
• 01/01/07

The San Diego Unified School District (SDCS), the second largest school district in California, with more than 15,800 employees serving almost 136,000 students, has initiated a photovoltaic roofing project that converts the sun’s energy into electricity and reduces energy costs. In December of 2003, the Board of Education approved the solar roof installation for 14 schools and administrative sites. In 2005, an additional nine sites were approved. As of January 1, 2007, a total of 24 systems are installed and operational. Plans are underway for 16 more, for a total of 40 facilities.

SDCS estimates the overall project will result in potential savings of more than $37 million in avoided costs during the next 20 years. It is anticipated that the project will have a capacity of 6.53 MW (milliwatts), producing 10,452MWH (milliwatt hours) of electricity annually. As of January 1, 2007, 3.57MW are operational.

Those unfamiliar with the process of getting solar roofs on top of their school buildings might be excused in thinking there’s not much more involved than flipping through your Yellow Pages, finding a good roofing contractor, and going from there.

Actually, the project at SDCD, apparently the first of its kind for a school district, has been considerably more complex. Its success has been made possible through its three main partners, Solar Integrated Technologies, Inc., (SIT); General Electric (GE); and GE Energy Financial Services.

The company believes it was the first company in North America to commercially market and sell an innovative and proprietary BlEW roofing system that combines flexible, thin-film solar modules with a single-ply roofing membrane for the nonresidential building market. Its nonschool customers include Wal-Mart, Coca-Cola, and Honeywell.

GE Energy Financial Services, Stamford, CT, with 300 experts, invests globally in the energy and water industries to help both its customers, and its parent company, GE, grow. This company has $13 billion in assets and invests more than $3 billion annually. In terms of the solar roofing, it has the right of first refusal on up to $500 million to fund these projects, $30 million of which have been exercised to date. Lets now turn to see how SDCS fits into the picture.

William Dos Santos, director of Maintenance and Operations, says that energy conservation is not a newly discovered topic at SDCS.“In 1994, the board made a commitment to conservation,” Dos Santos recalls.“We participated in a bond activity then, and have been at it ever since.”

During the past 12 years, the district has decreased energy usage by 25 percent due to occupancy sensors, a global lighting control system, efficient lighting, cool curtains, dark campus policy, re¬engineered HVAC systems, and more.

It’s out of this background that the district has evolved toward solar energy. It put out a request for proposals to the industry.

“We wanted on-site generation at predictable rates competitive with standard utility rates, but we didn’t want any upfront costs.”

What the district eventually negotiated with its partners, says energy utility coordinator, Jay Naish, “was an exceptionally good program.”

SIT provides not only the roofs into which are integrated the solar system, — for free — it also maintains all of the maintenance for the 20-year terms of the contract. “We not only get the new roofing we need for no cost, but we save on the technical staff needed to maintain it,” Naish explains. “We have a large district and a good technical staff, but we don’t have the training to maintain a single-membrane butyl roof, and we don’t need it for SIT will do it for us.”

Dos Santos says the district is not getting anything for free, for it buys the electricity through SIT, who gets it at a discounted rate from GE. Yet the district enjoys this discount compared to the SDG&E rate. The system works in parallel with SDG&E, so sites are never without electricity, even during cloudy weather. “It’s slicing the bread diagonally instead of vertically,” Dos Santos says. “It’s a different way of looking at the situation. We don’t have to budget upfront costs, and this way we’re better able to amortize.”

“Through our relationship with GE Energy Financial Services, we offer qualified customers an innovative, structured finance option that allows them to effectively spread the cost of our roof¬ing solution over a 20-year period, with no or minimal upfront cap¬ital expenditure,” says SITs CEO, Jon W. Slangerup. “This model expands our addressable market today, by allowing us to offer a value proposition to customers that have limited capital budgets or are not otherwise able to take advantage of the various solar tax incentives available.”

The three partners are not willing to disclose all of the details of their financial arrangements. But it’s safe to say they must be making money on the deal or they wouldn’t do it. “I don’t fully understand the financing, and don’t need to,” says Dos Santos. But he surmises that working as they do, with the economies of scale, they are able to take advantage of all of the various conservation incentives, including rebates, green credits, and tax breaks. “All we need to know is that it costs us considerably less than it would otherwise, 10 to 20 cents on the dollar or less,” Dos Santos says.

It sounds good, and it is. But there are limits. For instance, though SDCS will utilize solar on up to 40 sites, the remaining of the 210 sites are not a part of the plan. There are various reasons, such as the fact that many buildings are too small. A building has to be a certain size to make the project economically worthwhile. Also, some are near the ocean where clouds tend to block the sunlight more than the other sections of sunny San Diego.

This also places some limits on how far such a project can be transposed to other districts around the country. Andy Katell, a spokesperson for GE Energy Financial Services, says, “the amount of sunlight is crucial.” This, he explains, also has to do with the quality of the sunlight, it irradiant capacity, as well as temperature, latitude, the angle of the sun, and so on. Northern climates will have fewer hours of sunlight per day and, especially, per season. In other words, solar has a better chance of working in Arizona than Minnesota. Moreover, adds Katell, some states are better than others in providing energy saving incentives.

Don Santos adds that the negotiation process is laborious, takes time, and involves a lot of attorneys. “We believe any district can do this, but we feel we are different in that our decision makers have been willing to go out on a limb to see what’s out there, and then put forth the effort to make the best deal.”

There is also an additional educational benefit in that the project provides an opportunity for SDCS to educate its students in energy conservation. There is an electric meter on the side of the building. Students can see how much power is coming from the sunlight. At times the meter goes in reverse, which shows that excess energy is going back into the GE power grid.

Moreover, Katell says, the SDCS system is not, at this point, simply an experiment. It’s a proven system that works, and so can be adapted by other districts.

Dos Santos is happy the way things worked out. “These solar integrated roofing solutions are expected to provide the lion’s share of our peak power needs,” he says, “and provide an effective hedge against increases in utility rates over the next 20 years.