How Schools Are Lowering Operating Expenses with Solar

Published December 17, 2019

How Schools Are Lowering Operating Expenses with Solar

DATE PUBLISHED: December 17, 2019
Category: Blog Article
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For school administrators, budget directors and school board members, the annual budgeting cycle is high-pressure to say the least. And it never seems to end. You can be wrapping up last year’s budget, managing the current year’s budget and planning next year’s budget all at the same time!

Sometimes it can feel like no one else understands how much it costs to provide a quality education amidst ever-changing priorities. And because schools often represent half or more of the total municipal budget, all cost-cutting seems to start with you.

But there is a simple way to inject something positive into the budgeting process. Instead of being treated as an obstacle to a balanced budget, you could be the hero. We’re talking about solar energy.

Solar is a straightforward and fast way for you to greatly reduce your operating expenses and generate new revenue for your town’s tax base, with no upfront capital expenditure and without a costly, drawn-out competitive RFP. Best of all, clean solar energy is non-controversial and a source of great interest for members of School Committees, Finance Committees and Town Select boards.


Why Schools Should Care About Electric Bills

Solect Energy has installed solar energy systems for dozens of New England schools, so we’re well aware that electricity generally represents a small percentage of your overall operating expenses, often less than 2%.

But the total amount of money you’re paying to the utility is still considerable – and can be lowered with solar.

In our experience, schools that go solar see anywhere from a 10% to 60% reduction in their electricity prices. If you apply a conservative 5% savings to a school electricity budget of $826,052 – which is the actual budget for an average sized town’s school district in Massachusetts (based on population) -- that comes out to $41,300 in annual savings for that community!

When you go solar using a Power Purchase Agreement, you can secure these savings without a capital purchase. No money out of pocket, and no maintenance costs…just the savings.

Regardless of your town’s size, you can free up tens of thousands of dollars a year by slashing your electric bills with solar.


Examples of School Solar Savings

Actual savings vary based on factors that start with your utility, because each utility offers slightly different incentives. The size of your solar energy system, the location of the system (“on-site” or “off-site”), and the class of service at your utility meter also factor into how much you save.

But here are some real-life examples to whet your appetite:

  • Joyce Middle School in Woburn is saving about $29,000 a year. And this is just the start. The City is also installing solar on two other schools.
  • The City of Fitchburg installed solar on two schools and reduced its electricity budget by more than $60,000 a year.

These savings figures assume utility rates don’t change. But we all know they will probably go up, in which case the value of the solar energy generated by those schools becomes significantly greater as time goes on.

If $29,000 or $60,000 in found money a year sounds appealing to you, read on, or contact Solect Energy today to learn what solar can save your school district and town.

And if you bundle multiple project sites, as many towns and districts are doing, the savings multiply and add up, year after year.


It’s Worth the Time

Again, we understand that school budgeting is an intense and protracted process. You have to deal with multiple levels of feedback, input and approval through seemingly endless revisions. You have to factor in fluctuating enrollment, changes to the state’s education funding allocation formula, and maybe unequal contributions from the towns in your regional district.

With all that going on, it can be hard to find time to make a case for new projects, even ones like solar that pay for themselves, cut operating expenses, and generate new revenue.

But keep your eye on the prize. Join the scores of schools in the region that have gone solar, and are now sizing up additional schools for additional savings.

With Solect’s PPA program, you can do better than simply getting through the process with a workable budget. You can free up funds for core operations.

If you like, we can put you in touch with some of our school customers who can attest that the process is simple, and the savings are real and substantial.


How Solar for Schools Works

Solect is able to help schools go solar with no additional competitive bid process and no upfront capital because of our partnership with the largest nonprofit energy-buying consortium in New England, PowerOptions. PowerOptions has helped hundreds of New England schools, cities, towns, state agencies and nonprofits reduce their operating expenses with energy saving programs and contracts.

Together, Solect and PowerOptions have helped more than 60 municipalities and organizations profit with clean power, including these public and private educational institutions. (Click to read more about each one.)

The benefits of the Solect-PowerOptions partnership are significant:

  1. Lower electricity rates due to PowerOption’s competitive bid process that secures very competitive energy rates for its members, and complies with public procurement regulations.
  2. No competitive RFP process is required of you, because PowerOptions has already negotiated the contract terms and conditions and the PPA pricing structure on your behalf.
  3. No upfront capital is required from you. Your only financial commitment is paying your new, lower solar electric bills, and redirecting the electricity savings to more important budget items.

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Solect Makes it Easy

No capital is required for you to go solar because Solect finances your project. You enter into a Power Purchase Agreement (PPA) to buy the solar generated on your roof or in your parking lot, at a much lower price that what the utility delivers.

Solect wears many other hats as well, which makes your role in going solar very simple and straightforward. In addition to financing your solar energy project, we do the engineering and installation. We then operate and maintain the system. You have no operational or maintenance responsibility.

Under the Solect PPA, we also monitor your system’s performance long-term, to make sure it’s delivering maximum benefit to you.


PILOT Revenue

There’s some icing on this already delicious cake. Solect’s contract with your school will include Payments in Lieu of Taxes (PILOT) to compensate your city or town for the use of its public property, i.e. your roof, parking area or land, to support our solar panels and related equipment.

These PILOT payments provide a steady, predictable revenue stream for your community. Payments begin after the system is turned on, and generally contribute several thousand dollars a year in new revenue.


Get Started

You may think you don’t have time to save with solar. You may think as a non-tax-paying entity, you can’t access the value of government tax benefits for solar. But with Solect as your solar provider, you can.

Remember, the small line item for electricity in your budget equates to tens of thousands of dollars you can put to better use, to better serve your student body and staff. At the same time, you’ll be acting as a role model and steward of the environment. Many schools even develop curricula around their solar energy systems.

Don’t let ongoing budgeting chores stop you from taking advantage of the opportunity and extra funds waiting for you. Contact Solect today for your customized proposal, or if you have questions and want to learn more.

The outsized benefits of a solar program with Solect will be worth it – for next year and to make a positive, durable contribution to your important budget work!