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Companies seek solar-panel lease contracts from city

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A plan to install solar panels on city-owned rooftops is set to be considered Monday evening by the City-County Council.

The city’s Office of Sustainability selected Indianapolis-based Johnson-Melloh Solutions Inc. and Carmel-based Telamon Corp. to install the solar panels after putting out a request last fall.

The companies, working together, plan to lease space on certain city-owned rooftops and sell the electricity generated by the panels to Indianapolis Power & Light Co.

The city will use the money from the lease, as much as $24,000 for each site, to support sustainability projects such as replacing street lamps with more energy-efficient bulbs.

“This is an opportunity to really showcase solar energy in our community,” said John Hazlett, director of the city’s Office of Sustainability, during an April 26 Public Works Committee meeting.

Committee members unanimously approved the lease proposal by a 7-0 vote.

Leases for each site would run for 10 years with a five-year renewal option. The companies would pay the city $10,000 the first year for each lease and $1,000 for each following year.

Hazlett said the companies initially are targeting five locations, but the number could grow to as many as 30. The buildings under consideration are Department of Public Works and Indy Parks properties.

“We’ve got a lot of unused space on the roofs of many municipal buildings,” said City-County Councilor Zach Adamson, a member of the Public Works Committee who favors the agreement. “There’s a whole slew of possible locations.”

Solar panels also could be installed on the ground. But they would be protected by an 8-foot chain-link fence and away from prime park space, said Travis Murphy, Johnson Melloh’s business development manager.

“Our intention is to maximize the roof space if we can,” he told committee members. “We don’t want to take advantage of green space. That would be few and far between.”

The city would have the option of purchasing the solar panels after the leases expire.

The initiative is the third solar-energy project Indianapolis has undertaken. The city has installed solar-thermal systems, which help to heat water, at three parks facilities, and has put solar panels on the downtown City-County building.

Those efforts are part of a push started after Mayor Greg Ballard took office in 2008 to make 61 city-owned buildings more efficient with $18 million in upgrades to lighting, HVAC equipment and building controls.
 
Founded in 2009, Johnson Melloh Solutions is a division of Johnson Melloh Inc., a local mechanical contractor.

Telamon is a technology firm founded in 1985 by Albert Chen.

The two are part of ET Solutions, a joint venture that is leasing space at Indianapolis International Airport for an 11.5-megawatt solar farm on 60 acres at the airport’s entrance. Construction on the project is set to begin in the summer.

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  • was disclosed
    the terms of this pilot program were made fully public. 100%. nothing being hidden, and yes, rates probably increased by 1% on average.
  • full disclosure needed
    I'd like to see all sides of this for the leaser. $24k to the city, how much for the panels, how much is IPL going to pay for the power? Last figures I saw, the cost per kilowatt from a solar panel (to produce it) was about 4 to 8 times as much as the going rate for power from the electric company. Unless someone is subsidizing this arrangement (and a lot), it makes no financial sense for the leaser.

    Fed tax credit for 30% of the panel cost, Indianapolis credit for permit fees (which may or may not be offset by the lease income), hmm IPL buys at $0.24 per kilowatt and sells residential at $0.06 (or less) per kilowatt. I see who is subsidizing this deal, it is everyone who buys electricity or pays taxes.

    How about full disclosure with these arrangements, Zach? Including lease payments, rebates in permit fees, the Indianapolis program for subsidizing solar power, stuff like that. Show what the true financial arrangements for this deal.
    • RE: More Wasted Tax Dollars
      Zach Adamson:

      You said "This project won't cost the City or the tax payers anything." First, that's redundant, as the City has no money other than taxpayer money. Second, the statement is just false. Look here:
      http://dsireusa.org/incentives/index.cfm?EE=0&RE=0&SPV=0&ST=0§or=Commercial&state=IN&sh=1

      There are Federal and State gifts on that list, so yes, taxpayers lose, probably more thanthe measly income from the leases.

      You make the suggestion that in 15 years the solar systems may be purchased by the taxpayers...as if 15-year old systems would have any value. We should all be on LFTR/MSR by then.

      Is there a clause in the contract that conveys ownership of the systems to the taxpayers, free and clear, if these companies go bankrupt, as may happen when the tax credits and rebates dry up?

      Does IPL get tax credits and/or rebates for buying the solar power?

      Why don't the municipal buildings these systems are installed on just consume the generated power? Perhaps because IPL will pay more for it than what IPL charges the municipal buildings for line power? IPL can pay more with taxpayer subsidy offsetting the difference.
    • Solar Fairy Tale
      Unfortunately, those of you who are so eager to be GREEN have lost sight of the reality that with some ofthe lowest cost in the country for electricity, unless this is subsidized by the government, it will take 30 years for any payback and by then the panels will either be obsolete or requireing alot of capitol for maintenance. This is just another boondoggle to take advantage of government wish list freebies. It is legal but immoral and a burden to the taxpayer. In states where the cost per megawatt of electrcity is high, this is a viable solution. Not in Indiana.
    • win win
      This project wont cost the city or the tax payers anything. In fact, each site that is approved, will bring in $24,000 to the city to fund other projects planned in the office of sustainability for making city building more efficient (saving tax dollars) or saved for the future purchase of the solar equipment after the lease expires. The lease is for 15 years. The developers will sell the power generated to IPL to be sold to its customers.
      Zach Adamson
      City-County Council, At-Large
      • Solar panels.
        If you are interested in using solar panels have a responsible engineering firm design the installation. There are now two different solar panels in use today. One will generate electricity and the other heat. For most commercial installations electric generating panels will help. For commercial buildings additional heat source is necessary in the Indianapolis area but most heat units are disconnected at 45 to 50 degrees ambient because of the heat generated in the building by people, equipment, and lights. Also they only work when there is no heavy cloud cover. Years ago I tried to put solar heat panels on a box store in Indianapolis and it didn't work. On a restaurant in South Bend it worked. (ref: Solar Magazine-May 1980 ).
      • MrGadget
        You were probably reading the wrong article...one about Duke energy plant
      • More Wasted Tax Dollars
        What's this gonna cost tax payers?

        Which campaigns were greased?
      • SOLAR
        Interesting Article.
      • No Brainer
        If you're in IPL or NIPSCO territory, putting solar on your roof is a no-brainer if you have relatively cheap access to cash. There's an immediate payback and you have positive cashflow throughout the 10-15 yr payback. Also, IPL is offering 10-15 yr rate locks on purchase and buyback rates.

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      1. How much you wanna bet, that 70% of the jobs created there (after construction) are minimum wage? And Harvey is correct, the vast majority of residents in this project will drive to their jobs, and to think otherwise, is like Harvey says, a pipe dream. Someone working at a restaurant or retail store will not be able to afford living there. What ever happened to people who wanted to build buildings, paying for it themselves? Not a fan of these tax deals.

      2. Uh, no GeorgeP. The project is supposed to bring on 1,000 jobs and those people along with the people that will be living in the new residential will be driving to their jobs. The walkable stuff is a pipe dream. Besides, walkable is defined as having all daily necessities within 1/2 mile. That's not the case here. Never will be.

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      5. The Indy Star announced today the appointment of a new Beverage Reporter! So instead of insightful reports on Indy pro sports and Indiana college teams, you now get to read stories about the 432nd new brewery open or some obscure Hoosier winery winning a county fair blue ribbon. Yep, that's the coverage we Star readers crave. Not.

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