In October 2009, the IRS awarded Seminole the right to issue up to $34m in new Clean Renewable Energy Bonds (CREBs) to finance a 1-5MW solar energy project. Seminole is evaluating its natural gas-fueled Midulla Generating Station, in southwest Florida, as a site for the facility, which would consist of an array of solar PV panels and associated energy storage capabilities.
Seminole, a wholesale power supplier to ten Florida distribution cooperatives, currently meets about 4% of its member systems’ energy needs with renewable energy. The cooperative estimates the solar facility will have a 20% capacity factor. A battery bank would be used to allow the energy produced by the panels to be stored for later use as needed.
According to a Seminole spokesperson, storage capabilities increase the utility of solar facilities since peak solar production hours do not always coincide with periods of highest energy demand.
A total of $2.2 billion of congressionally authorized new CREB awards was awarded to 805 proposed projects. The IRS awarded approximately $458m of that new CREB funding to projects proposed by consumer-owned electric cooperatives in 17 states.
The original CREB programme was created by the Energy Policy Act of 2005. The new CREB programme is funded through $800m allocation in the Energy Improvement and Extension Act of 2008 and $1.6m stimulus allocation in the American Recovery and Reinvestment Act of 2009.
Both CREB programmes are designed to encourage the development of new, clean energy projects, and give authorized issuers the right to issue bonds to fund qualifying projects that benefit both customers and the environment.
Bondholders–new CREB lenders or purchasers–receive a variable quarterly tax-credit, the amount of which is set by the US Treasury. Under the new CREB programme, authorized bond issuers may issue their bonds at a discount, or make supplemental interest payments.
Seminole has published a request for proposals for the PV portion of the project. Bidding is open to prequalified vendors with experience in developing large-scale PV projects. The cooperative expects to make a final decision on developing the project by March 2010. Seminole has also applied for a US Department of Energy Smart Grid grant to support the battery bank portion of this project, in partnership with the National Rural Electric Cooperative Association and its research division, the Cooperative Research Network.
