Building on a statewide swell in support of solar energy, the town of Apex is asking the General Assembly to create state-funded grants for local governments that want to install solar panels.
Council member Bill Jensen, who owns a small solar company but is mostly retired, introduced the idea in February. He has since been emailing mayors and other leaders around Wake County to drum up support and said recently he might soon start appealing directly to lobbyists and lawmakers.
“In the past I’ve tried to get solar energy projects going for several of our buildings,” Jensen said at the time. “I found people, a couple people actually, who were willing to participate. But whenever I try to talk to the banks, I get the door slammed in my face because they don’t understand stuff like this.”
That’s where the state comes in, he said. For years there have been state grants in the form of tax credits for individuals and businesses who want to install solar panels, but none for municipalities and public entities.
The town council voted 4-1 to add the solar request to its legislative agenda. Council member Scott Lassiter opposed it, citing the state’s already constricted budget.
“It increases state spending on something I don’t think is a priority,” he said during the February debate. “When every teacher is paid enough, when every pothole is fixed, and every road is widened and state buildings are free of rats, I’ll support this.”
Jensen, however, argued that state subsidies would make solar power affordable or even profitable for towns – even at small levels of power generation.
Turning a clean profit
Municipalities can borrow money at a 3.5-percent interest rate, Jensen wrote in an email to Raleigh Mayor Nancy McFarland and other leaders around Wake County. A 100-kilowatt solar array costs about $250,000, Jensen said, and would provide a 2.8-percent return on investment.
But with a 10-percent state grant, the return on investment jumps to 3.6 percent, and the town breaks even, Jensen said. A 30-percent grant would drop the town’s cost to $175,000 and increase its return on investment to 5.8 percent.
He said solar panels address health risks from pollution, regional environmental requirements, the cost of importing coal and the potential damage to the state’s coast and fishing industry from global warming.
He said he hasn’t heard yet from the local leaders he reached out to.
He’s worried other legislators may not share his concerns, but he could find support from a coalition of Republicans, along with a few Democrats, who introduced a Senate bill on Wednesday that would extend the expiration of state tax credits for home solar projects from 2016 to 2021.
The bill doesn’t include anything for municipal projects, such as what Apex has requested, but it is a bipartisan push for solar subsidies.
An advocacy group called Conservatives for Clean Energy formed last year, also indicating a shift in thinking. It supports pro-solar policies and conducts polls that have found support from likely Republican voters for various clean energy initiatives, including 72 percent in favor of tax credits.
Local solar projects
If Apex’s request does come to fruition, Jensen has proposed installing solar panels at the Western Wake Regional Water Reclamation facility – a $290 million sewer plant that opened last year near New Hill.
The plant uses about 8 megawatts of power and has several dozen acres of empty land nearby that could potentially host a solar farm.
The large solar arrays needed to power such a plant are built at such a scale that the town would make a positive return on investment even without state help, according to Jensen’s calculations. But at about $2 million per megawatt, the question isn’t future returns but rather immediate financing.
“It would be a hefty price tag,” Jensen said.
Cary already joined the solar trend with 1.9 megawatts of solar capacity at one of its water plants. A solar company pays the town $35,000 a year to rent the space and sells the energy produced on site, according to the town’s website.
“The town makes money, the owner of the solar farm makes money, and we produce energy,” said Cary Mayor Harold Weinbrecht in an email to Jensen.
Cary also is considering solar panels at four other town-owned sites.
Apex has less of a solar footprint, with a small array on the bathrooms at Nature Park. John Brown, Apex’s director of parks, recreation and cultural resources, said it cost $40,000 or $50,000. The town considered installing solar at other park bathrooms but decided the costs outweighed the benefits.
But in North Carolina as a whole, the solar industry is booming. According to a recent Duke University study, the state produces the most solar energy in the Southeast and the fourth most in the nation, despite having almost no solar panels seven years ago.
By some counts, the industry contributes $2 billion a year to the North Carolina economy.
Doran: 919-460-2604; Twitter: @will_doran