Gila Community College (GCC) is going to be run on Solar Energy before the end of the year.
On August 29th 2012, a letter of intent was signed by the board of the school with Folium Energy, a provider of finances for those looking to pursue alternative energy.
Folium is a company based in Texas. They are a producer of Energy, as well as project developers and investors in various types of alternative energy. This includes solar energy, wind and biomass.
Over the past year, the board of GCC have worked with a consultant for PV Advanced Concepts. The idea of this consultation was to make all of the pieces fit together. Tom Harris, the managing partner for this companies works closely with various schools around Arizona to bring solar project to these institutions.
Arizona has some of the most aggressive green energy goals in the country. The Arizona Public Service has created a number of programs and incentives for various institutions, including non-profits, local governments and schools. The idea here is to help reduce the load on the grid, and reduce carbon in the environment. GCC is the latest school in the area to pursue Solar Energy.
Board President Larry Stephenson said that this was merely a formality. He said that a letter of intent had already been signed with Sunrenu, a company based in Scottsdale who will construct the project. The intention of the meeting was to simply seal the deal with Folium.
The meeting was carried out whilst both Harris and John McDonnell stood outside of the hall in anticipation. The real idea behind the meeting was to discuss two proposals on the table, one from Folium, and one from Tioga, another company with the same ideals.
Acting in due diligence, board member, Tom Loeffler met with GCC Senior Dean Steve Cullen and a legal counsel. The intention of this meeting was to discuss a contract with Tioga, a larger company based in California.
Both of the contracts were discussed in depth. Loeffler tried to summarise what he felt was missing from both of the contracts. During this meeting, both of the CEO’s of Folium discussed how their solar projects could help institutions such as GCC work.
The Arizona Corporation Commission instituted a tariff in 2006 which requires electric companies to get 15% of their energy from renewable sources by 2025. Companies such as Folium then began to start converting public institutions to work on Solar Power. These are considered good targets for long contracts, in this case, 20 years long. The intention of these contracts is to help pay off the investors in the project.
Investors are important for projects like this, not because a public institution isn’t a safe bet, but because they do not have the money available to pay for both the solar equipment and the construction costs. However, they will be in existence long enough to help pay back the investors of the project.
The process works when the investors pay the construction and equipment costs up front. They then use tax write-off benefits over the length of the contract to help recoup their investment. The company at the same time will find a construction partner to build the system. GCC will need a contract with both of these.
Unlike homeowners though, GCC will not be paying smaller bills after the system is installed. Instead they will be paying the same amount for energy over the next 20 years, no matter how much energy the panels produce.
The project must break ground by the end of the year for the investors to take advantage of tax credits.