May-June 2010

Local Power

More and more water districts are turning to onsite renewable energy.

Communities or private purveyors of water must change their power sources to meet new state regulations and operate their businesses as their customers wish. At first, that sounds expensive and technically unfeasible. This, however, is not the time to shrug one’s shoulders, give up, and sweep the problem under the community carpet. It will not go away. More and more water districts, communities, and private companies are undertaking to use renewable power (so far, it’s been mostly solar or wind) for some, or all, of their operations. Renewable power may be onsite under local control, and with that comes an independence that some communities thought they would never see again. Water districts and water utilities are leading the way. (If onsite power is a phrase quite foreign to you, it would be worthwhile checking some issues of the magazine Distributed Energy, which has many expert articles about onsite power: www.distributedenergy.com. They may not all be appropriate to the needs of water utilities, but they will certainly set you thinking about what could be available now or in the future.)

The driving force behind this nationwide move to using more renewable energy, rather than energy based on fossil fuels, comes from the communities and states (equals we the people!) who want better things for their future, their children, and grandchildren. That driving force is not a sales ploy from companies who happened to have developed new technologies. It is a genuine concern for the future of our nation, especially when the frequency and cost of outages in the traditional systems of power are forecast to get worse.

One of the leading solar power companies, Solar Power Partners, has more than 40 successful systems in operation already. They were financed by solar Power Purchase Agreements (PPA). Those are the practical means by which even your community or utility can stop shrugging shoulders and advance with others.

Photo: SunPower Corp. With onsite power comes energy independence and reliability.

 “One should always check the availability of local subsidies,” observes Kevin Ross, Senior Project Development Manager at SunPower Corporation, a company that has led the progress in renewable energy programs for some years. SunPower focuses on the water industry, including the irrigation–water nexus. “There are federal programs for tax credits and different states have different structures for renewable energy credits. More than half of our states have an RPS requirement.”

RPS stands here for Renewable Portfolio Standards. One of the simplest ways for a community to start the momentum is to offer a number of acres for building a power plant. The public authority may have to make some basic preparations on the land (dozing, grading, etc.), but the benefits from that simple start can be huge for the community. People who live in big, crowded cities may not see where there are five acres of public land available, but there are thousands of communities that do enjoy such potential wealth.

“There are different financial structures for water utilities,” adds Ross, with Power Purchase Agreements perhaps the most popular today. “A developer such as SunPower, with financial strength and design-build capability, can work out a development plan that brings no capital cost to the user. A long-term agreement would be 20 years for such a contract.”

Yes, there are different levels of solar power, and you should research that technical side of this subject. SunPower, for example, claims the most powerful solar available, thanks to its proprietary solar cell, and can produce over a 30-year period 43% more total energy than comparable PV-based solar energy systems and about 105% more than thin-film solar systems. SunPower tends to concentrate on customers who require bigger systems, as it has excellent resources for land use issues. A typical 1-MW system, ground-mounted, would take up about 5 to 9 acres.

More than 25 water agencies in the western states have used SunPower solar systems, including a 3.5-MW system on four sites for the Inland Empire Utilities Agency, which anticipates savings of $200,000 in electricity costs in the first year. There is also a 2.2-MW system for Lake County Sanitation District in California. That is expected to save residents up to $5 million over the next 20 years.

“Why California?” you may be asking. Under Assembly Bill 32, greenhouse gas emissions must be reduced statewide by 2020 to what they were in 1990. With this mandate, industries (such as water) will face penalties for non-compliance with the statewide greenhouse gas emissions reporting and monitoring. Implementing solar power systems allows water agencies to receive bill credits for the electricity generated by a renewable generating facility. The extended and expanded 30% federal investment tax credit for solar also provides the financial support and incentive for water agencies to install solar power systems. That is, it makes good financial sense for a community. Why California? Don’t shrug again and say you don’t live in California; it does not have to be California. What are the mandates and incentives in your state? Several states, on all corners, coasts, and centers, have similar programs where you must meet the rules, but with the delightful addendum, there are ways for you to meet the rules with little or no financial disruption.

How important is the size of the project?
A common, and often justified, reaction to all new technologies is: “That’s fine for those who are big enough to afford it, but what about us?” Let’s look at two programs in onsite power for water purveyors that serve customers perceived as very different in size, but equally important to their customers. Consider American Water, the largest investor-owned purveyor of good water in the US. One of the most knowledgeable and helpful persons I have spoken with about water and power is Mark LeChevallier, who works at American Water in New Jersey as Director of Innovation & Environmental Stewardship. Among his duties, LeChevallier directs a staff of 18, for both research and environmental compliance programs for American Water. That includes the development of environmental management plans for more than 1,000 operating centers, environmental audits to ensure compliance, development of a national cross connection control program for the company, and implementation of environmental stewardship and greenhouse gas control programs. American Water, with more than 7,000 employees, provides drinking water, wastewater, and other related services to some 15 million people in 32 states and Ontario, Canada. (When you read this, they will probably have entered three more states.)

In December 2009, American Water, which delivers about 1 billion gallons of water per day, announced it has set a goal to lower its greenhouse gas emissions per volume of water produced by 16% by the year 2017. This goal is part of the company’s commitment to the EPA’s Climate Leaders partnership. The company plans to achieve its goal by reducing the amount of energy it uses, including the development of greater water pump efficiency. “The water industry has always been a ‘green’ business,” notes Don Correll, president and CEO of American Water. “Protecting our water resources is essential to the service we provide and, since there is a correlation between carbon emissions and water resources, this initiative is a logical next step for our company. By improving air quality, we reduce the climate change that impacts weather patterns, which, in turn, impacts water resources.”

This initiative isn’t a sudden decision! American Water uses 100% wind power at its Yardley, PA, plant and the Canal Road plant in Somerset, NJ, uses solar panels for about 20% of its energy requirements. Thirteen to 15 additional plants with savings in the renewable energy mode are already planned. It is most helpful, of course, that Public Utility Commissions in New Jersey have good incentive programs for those who’d like to use solar energy for community benefits.

Photo: Solar Power Partners Power Purchase agreements can help with funding issues.

So there’s a big water purveyor already leading the way to the use of renewable energy. Is there anybody who helps solve the smaller water distribution problems around the world? WorldWater & Solar Technologies Inc. has been solving problems related to renewable energy and drinking water worldwide. Mobile MaxPure (MMP) is their product, and they have more than 50 systems to show its merit. Customers vary from the US Marines and residents in the Euphrates and Tigris River Valleys, to displaced people in Darfur. Perhaps the company’s best-known success in the US was its prompt and valuable help as first responders to the Katrina disaster in Mississippi. Of that effort, Alan H. Morrell, Director, Morrell Foundation, says: “The Mobile MaxPure unit operated flawlessly for the seven months it was deployed in Waveland. During this time, all potable water for thousands of people at our relief camp came to this unit. It never let us down. It met or exceeded all advertised performance expectations.”

This is a standalone patented solar power product that extends its reach to places where no infrastructure is available and a continual supply of diesel is impractical. The modularity of MMP allows for flexible system design to meet the drinking water needs from a small village community to a town. Each system produces 30,000 gallons of potable water per day from freshwater sources, enough for about 6,000 people. You could use multiple systems in one region to include filtration of freshwater, brackish water, or seawater sources. The potable water produced costs about one cent per gallon over the first year, providing 30,000 gallons per day, 24 hours per day, seven days a week. After year one, the costs go down to fractions of a penny per gallon of water, because the capital outlay has been paid off. The system lasts for 25 years or more. The sun is its source of energy. Annual expenses for filters and other useables average less than $5,000 per year per system. It has no dependence on fossil fuels … and no noise! A system is preassembled; ships by land, sea, or air; and takes about 30 minutes to set up at the site. It’s a small system, yes, but one can imagine many circumstances where such a mobile, solar-powered solution could be a godsend.

Applications and Experts
It’s always interesting to read or hear of communities that have already chosen to make the onsite power choice to give added momentum to our national advance in using renewable energy. In Capella, CA, the Redwood Valley Water District worked with Solar Power Partners (SPP) to develop a 99.2-kW solar energy system. They used a solar PPA (with a term of 15 years with buyout option at fair market value), under whose terms there was no upfront capital required from the Water District. This system produces enough renewable energy per year to offset 102 metric tons of carbon dioxide, or the equivalent to emissions from 11,578 gallons of gasoline consumed. It took about three years to find a way to incorporate solar energy without significant upfront capital or the added costs of maintaining and operating the system. (SPP does that.) Under the terms of the solar PPA, the Water District buys power at a set rate, and future critical upgrades to the system are not incurred by the Water District. Advance Power Inc. was the installation partner for SPP on this project, which is fixed ground-mount style and produces an annual estimated 143,372 kWh.

The Valley Center Municipal Water District has a 1.1-MW solar power system, also developed in partnership with SPP through a solar PPA. This system will provide 2.1 million kWh per year of electricity, enough to offset about 20% of the electricity required by the district’s largest pumping station. The installation is a single-axis ground tracking style, and the purchase agreement is for 25 years with a buyout option at fair market value.

“Valley Center Water District is proud to have a ‘double green’ solar project, one which reduces power costs for our customers and benefits the environment,” comments Gary Arant, General Manager for the Valley Center Water District. “SPP did a great job helping us oversee the quality during construction and now monitoring the system for optimal performance. We had no upfront costs, and a portion of our energy costs are stabilized for years. This is a win-win for SPP, our District, and our ratepayers.” SPP partnered with WorldWater and Solar Technologies Corp. to install the ground-mounted single-axis tracking system. That style allows automated panel tilting to harvest the most sun.

Not everybody in the offices (or even the management) of a water utility claims to be an infallible expert in every aspect of the work required, so it is sensible and practical to seek outside help for the solution of some problems. Many experts work for vendors, and it may bother some public employees that the advice of vendors may be always prejudiced in favor of their employers, using the premise, “They just want to sell us something.” Such a conclusion is not necessarily true. In speaking with representatives of different solar power equipment suppliers, I have been impressed by their honesty in assessing the merits of competitors and their bluntness is telling me that their own product may not be best for such-and-such a situation. The true expertise in these matters seems to be a knowledge of what is available and, coupled with that essential, an understanding of what would suit your community in the best way. To achieve the ideal goal for onsite power for your water utility, you should know what you want, what you don’t want, and what will work best for your customers (or community) for several years. To answer all your questions accurately, you may need help from outside sources.

Understanding from its vast experience in the water industry that the financing of solutions such as onsite power is often the greatest stumbling block for a community, Black & Veatch has introduced a series of free industry forums to serve water utilities and the water financing community. Disruptions in the municipal bond market in the last two years impacted the ability of water utilities to obtain capital financing for urgently needed projects. Many capital projects have been slowed down or brought to a painful halt. “Today’s water utilities face unprecedented circumstances and ever-changing capital markets,” advises Michael Vann, who is on the advisory board for Black & Veatch’s Enterprise Management Solutions (EMS) division. Vann is the former general manager of the Birmingham Water Works Board.

Another well-known person helping in this endeavor is John Huber, retired President and CEO of Louisville Water Company. “Black & Veatch is fortunate to have a number of former water utility executives on our management consulting team,” notes Rodger Smith, President of the EMS division. “They understand how water utility CEOs, CFOs, and general managers are struggling with current financing issues. Black & Veatch is pleased to host these teleconferences as a public service to the industry, a non-commercial effort to provide answers from leading authorities on current financing topics.” If you would like to be added to the invitation list for future events of this nature, please send your name (and the names of others in your enterprise, if you wish) and e-mail address to Gary Layton, at LaytonGE@bv.com.

More Sources for Renewable Power
It would be easy and wrong to think of solar power as the only onsite power to help you improve your water distribution without fossil fuels and reliance on the established electric sources, and in compliance with your state regulations. There are other sources of onsite power. Wind power has been popular for some water districts. Like solar power, wind power comes from a free source. At the Hartford, CT, Water Pollution Control Facility, the largest of four wastewater treatment plants operated by the Metropolitan District Commission of that city, the steam produced from incinerators will power a turbine and produce an estimated 1.5 MW of electricity per hour, about 40% of the facility’s annual electricity consumption. “By harnessing energy produced onsite and utilizing it as a renewable energy source, the facility will remain an environmentally sound and socially responsible one with more flexibility and efficiency, and less dependence on oil and other non-renewable energy resources,” observes Dan McCarthy, President and CEO of Black & Veatch’s global water business. That company is designing and overseeing construction of this large energy recovery project.

In Wisconsin, the Milwaukee Metropolitan Sewerage District will use a 17-mile pipeline to carry landfill gas from Muskego to the Joe’s Island sewerage treatment plant on Lake Michigan. The project should save the District, its customers, and the taxpayers, almost $150 million in the next two decades. The landfill gas at Muskego is between 50% and 55% methane and will replace natural gas (which would be about twice the price!) for 12 sludge dryers. The target date for completion of this project is the beginning of 2011. Landfill gas is surely an onsite source of power in many communities.

Like sunshine, wind is a free commodity. It may seem to benefit rural, heartland communities more than others, but that could change quickly. The obvious financial benefit for rural counties will come from land-lease payments and tax revenues; the latter could be more than $1.5 billion annually by 2030. Recently, there have been giant strides in understanding the advantages and benefits of offshore wind power, which would benefit coastal communities especially. How many US residents live within 50 miles of a coast? More than half the population, and indications are that more and more people are moving to one coast or another. At the moment, the greatest results from wind power seem to be in midwestern states like Minnesota and Iowa, and those results include wind power for water utilities in communities like those served by the Iowa Lakes Regional Water district. This district, which expanded its customer base 20 years ago to include more homes and farms, partnered with, and received, valuable help from a local community college, the Iowa Lakes Community College, which has a Wind Energy and Turbine Technology program, the two-year Associate in Applied Science, to help meet the demand for skilled technicians in Iowa’s rapidly growing use of wind turbines.

Back to the sun, to finish. “About half of all water used in this country is used to produce energy,” advises Tom Rooney, CEO of SPG Solar, one of the largest photovoltaic solar companies in North America. “In California, 20% of the energy is used to move, heat, and treat water. But not all energy produces the same water footprint. Biodiesel can consume more than 100 gallons of water for each gallon of fuel. On average, it takes one or two gallons of water to create one kilowatt-hour of energy [enough to run a medium air-conditioner for an hour]. At Virginia Tech, researchers determined that it took eight to 16 gallons of water to burn one 60-watt light bulb for 12 hours a day. That’s 3,000 to 6,300 gallons of water a year. Solar photovoltaic energy creates almost no water footprint because it does not need to be cooled.” SPG Solar has proved its point in an impressive customer base of schools, churches, movie theaters, office buildings, wineries, and ponds. Those are not huge, multi-million dollar projects, and they all help to conserve and distribute our precious water.

The more you investigate renewable power or onsite power, the more you notice that every project is a success from more than one source, with the very essence of the community important to what is designed for equipment and operation. Could renewable, onsite power help your community to conserve energy, and gain power independence and stability of expenditures in its water distribution? It is worth more research, and it may cost much less than you always thought.