Idaho Power’s latest estimates to build subscription-based, community-owned solar farm in Blaine County show prices dropping on arrays—but any development would likely require big support from Blaine County residents, government and their collective wallets.
On Tuesday, the Blaine County commissioners heard an update on the potential project, which would represent Idaho Power’s second stab at its Community Solar Pilot Program. Under that model, users pay a one-time subscription fee up front in exchange for an annual credit off their power bill over the life of the system. Idaho Power uses the charge to build the farm, and the power it generates flows back into the utility’s grid, but it doesn’t earn a return. The subscribers are basically investors; their capital goes toward upfront costs and construction, after which it belongs to them, according to Delivery Planning Manager David Angell.
They own it, that is, if the community generates enough money to cover construction. That’s what stalled its first attempt, in an open, company-owned field by a substation 4 miles southeast of downtown Boise.
There, Idaho Power tried to sell 1,563 subscriptions at a one-time charge of $562—what amounts to a 25-year payback period based on the 3.5 cent credit per kilowatt hour generated for that project, more than two times longer than the break-even point on most modern private arrays. (The project’s solar panels have an expected lifespan of 25 years.)
The disparity between the payback time on a community solar field and a private array comes down to how the company reimburses customers for the energy generated. While Idaho Power rebates customers using private systems the full retail cost, it would credit community solar subscribers roughly the amount Idaho Power would save by not having to generate that power by traditional means—considerably less. Only about a third of the cost per kilowatt hour people see on their power bill covers the actual generation of the electricity. The rest is for the service—distribution, overhead, paying employees, etc., and not included in the credit.
“Very few” people went for it, Angell told the commissioners in February, and the project stalled.
The price has since come down, with a major caveat.
Idaho Power could look to sell 3,625 subscriptions for a seven-acre, one-megawatt field at $389 each—an 18-year payback period, inflation adjusted, Angell told the board.
But, that price only holds if Idaho Power get use of the land for free, or close to it. The costs to lease acreage would be passed on to the subscribers—and Idaho Power won’t go forward with the build unless the project is close to fully subscribed.
Land costs already took one company-favored location off the table. Angell approached the Idaho Department of Lands about leasing a property near Buttercup Road north of Hailey. The department required an auction for the lease.
“That set up a chicken-and-egg scenario,” Angell said: Idaho Power won’t commit to a project without enough up-front subscribers to pay for it, but it can’t price or sell subscriptions without knowing the cost of the land.
At minimum, Angell estimated that the Buttercup property would push prices up to $560 a subscription, anyway—basically the same price that failed in Boise.
With the state off the table, Angell is looking into privately owned land in the south valley, as well as a portion of a county-owned lot near Glendale Road, which has been earmarked as a potentially valuable gravel pit.
“The county is one option, but it is not the only option,” he said.
“Eighteen years is a long time—that’s essentially residents or businesses saying, ‘It’s important to me to sponsor green energy in this valley.’ You’d be paying a premium for that.”