HONESDALE, PA — It’s required some modifications from the original plan, but locals can still expect to see solar panels atop the Stourbridge Project in Honesdale in the near …
HONESDALE, PA — It’s required some modifications from the original plan, but locals can still expect to see solar panels atop the Stourbridge Project in Honesdale in the near future.
In April of last year, the local Clean Energy Co-op announced that it had come to an agreement with the Wayne County Commissioners to install a solar PV system on the roof of the 1928 Stourbridge Elementary School building, which is currently home to the county’s business incubator and communal working space, the Stourbridge Project.
One of the agreement’s contingencies was securing a USDA grant that the co-op had been awarded in the past for a similar solar installation at The Cooperage Project. The grant would have covered up to 25 percent of the installation costs. But this time, the USDA was not hasty with its response. Jack Barnett, the co-op’s president, said that waiting to hear the results of the grant application delayed getting installation underway by six months.
When the USDA did respond, the news wasn’t good: The co-op had not secured the grant. Barnett said, having won the grant once before, it was more difficult to compete this year because first-timers get bonus points for applying. With solar getting more and more popular, Barnett also said that there’s more competition than there used to be.
Eager not to see the sunset on this solar project, the co-op’s leaders came up with an alternative, “somewhat common” method for financing the project: creating a separate limited liability company—majority-owned and managed by the co-op—to construct, own and operate the solar array. The commissioners recently agreed to exit their original contract with the co-op, and enter into a new, slightly different one with the Stourbridge Solar Project, LLC.
“The LLC will have an additional local business owner who will invest $15,000 for 24 percent equity. But instead of getting that back in cash over the next five-plus years, that investor will be able to use most of the federal tax incentives and some depreciation benefits from the construction of this solar array,” the co-op explains on its website. “After 2025, the other investor will exit the LLC, leaving our co-op as its sole owner. We then dissolve the LLC to take direct ownership of and continue operating the solar array. This plan allows our co-op to proceed with this important solar project without the originally planned $17,000 in [USDA] grant funding, and together with our prior project revenues, be able to pay dividends and ultimately buyback all our currently issued preferred shares over the next 25 years.”
Barnett said he expects the 33-kilowatt solar system to account for about 30 percent of the building’s electricity. He noted that Stourbridge’s new elevator and its prototyping equipment require a good deal of electricity.
With the new LLC formed, building permit acquired and equipment ordered, Barnett said the co-op is hopeful to see construction get started as soon as possible.
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