Warren County Report

March 20, 2010

Familiar faces at top of solar proposals

Waltz: AMP poised to bring 300-megawatt proposal to its membership

By Roger Bianchini

The first feedback on the $100,000 consultant analysis of RFP’s (Request for Proposals) to develop a solar energy field here was heard at a March 15 Front Royal Town Council Work Session.

The bottom line:

1) the guys that brought the idea to you in the first place (Standard Energy, formerly SolAVerde et.al) have the best proposal out of 39 submissions on the table;

2) but don’t jump to conclusions because it could be better if the town’s municipal energy partnership American Municipal Power (AMP-Ohio) jumps into the ballgame, likely in conjunction with Standard Energy.

Alright, maybe AMP jumped in outside the parameters of the RFP process you paid us $100 grand to develop and analyze for you but so what if it’s to our benefit? GDS Project Manager Gerrett Cole essentially told the town.

When Carson Lauder, who along with Chris Holloway bristled at AMP’s potential involvement outside the RFP process at a March 1^st work session, suggested holding a potential private sector AMP business proposal to the same 30-day timeframe included in the RFP process, Cole suggested caution.

“You do want to maintain a sense of equity but not limit you options,” Cole said in suggesting leeway in seeing what might be offered in the wake of Standard Energy-AMP discussions under way since December.  He explained that an AMP option brought flexibility to the table of town involvement.

“I would suggest you hold off on any action until you hear what AMP has to offer,” Cole told council.  GDS has narrowed what it considers the most viable solar power proposals down to three, Standard Energy, Solbridge and NovaSolEnergy of the 39 RFP’s- under review since Jan. 22.  However when Vice Mayor Bret Hrbek suggested notifying the other 36 applicants they had been eliminated, Cole again suggested caution before any action prior to input from AMP on potential involvement.  It appeared that latter recommendation was based on the outside chance AMP might elect to become involved with a solar partner other than Standard Energy.

As a member of the AMP-Ohio Board of Directors as Front Royal’s representative, Town Director of Energy Resources Joe Waltz said he had been told by AMP’s CEO that the municipal partnership was poised to bring a 300 mega watt solar proposal to its municipal network with Front Royal likely to be cited as the source site.  The AMP board meeting is slated for March 17.  However late information received from the town on March 18^th indicated AMP did not have its solar package ready for that St. Patrick’s Day board meeting and has rescheduled the presentation for its next meeting in April (Likely story.  They were probably all awash in green beer).  Prior to being connected to Standard Energy through town staff, AMP had been discussing a solar power field with Danville, Virginia officials.

AMP refresh course

The town became a partner in the AMP-Ohio municipal; network about three years ago during the previous council’s tenure when it committed to a 50-year contract on the purchase of coal fired power originating in the Ohio Valley.  That coal plant contract could eventually account for 30 percent of the town’s power needs.  The goal of the AMP partnership is to insure members of lower, long-term energy rates from a diversified portfolio mixing carbon and sustainable energy sources as a hedge against traditionally rising market prices and sharp fluctuations in any one power source.  Waltz brought the municipal partnership to the town’s attention as a potential hedge against long-term upward market pricing trends.

AMP is also involved in developing sustainable energy sources and the town has purchased some hydro power, 5 megawatts in Phase One of AMP’s hydro expansion along the Ohio River, and is currently negotiation the purchase of 2.7 megawatts more hydro power in Phase Two of AMP’s hydro project’s

Sparky revisited

As readers of our River City tabloid chronicles may recall, sparks flew on March 1^st when Town Manager Michael Graham, filling in for Waltz, informed council a potential AMP-Standard Energy proposal might be forthcoming in the wake of the March 17 AMP-Ohio board of Directors meeting.  At that point Lauder and Holloway objected to private sector talks unrelated to the RFP process council had committed $100,000 to.

However both Vice Mayor Bret Hrbek and Shae Parker defended private sector discussions between AMP and Standard energy.

“We had a company come to us looking to invest, [and] looking at us as an investor and we said well, before we invest with you let’s see if we can build the same thing – trying to undercut that company –cheaper… And we got the idea from them in the first place,” Parker pointed out, adding, ‘It wouldn’t stop us id we like one of these RFP’s from another company to find our own land and to build it on our own.  But we can’t stop another company from doing business.”

But now with Standard Energy topping the consultant’s short list of the three most viable RFP solar power production options, it appears fears of a Standard-AMP end run of the RFP process have been laid to rest.  As of the March 15^th consultant analysis and conclusions, Standard is at the top of the RFP list and AMP’s potential involvement outside the RFP process is seen as a potential boon for the town, according to both consultants GDS and the town’s energy director.

On March 1, Mayor Eugene Tewalt pointed to the potential benefit of the AMP option. – “If AMP comes in today and says we’re going to build it and leave the town completely off the table,” to me I don’t see why we’d even get involved in [the development process,] Tewalt said.

Trying to dig himself out of the March 1^st line of fire Graham told council,  “If AMP comes back in and they say regardless of the RFP- Front Royal, we want to buy 3 megawatts of solar power, do you want to buy it?” … it’s a decision of council whether they want to go out and do the project themselves. Buy it from an independent group of people, or whether they want to even entertain AMP.  We can say to AMP, we’re not interested, we’re doing our own.  It is purely council’s decision which direction they want to go.  We have two options now, instead of one… If we want to get one of the top three bids and it’s a better price and financing works out the way you want it to, then go with them.”

It now appears the anticipated AMP proposal and the solar RFP process have merged into one preferred option – and sometime between March17, and now it appears mid-April, all the solar cards may finally be on the table with the Town of Front Royal sitting in the “catbird’s” seat… unless of course some nefarious, clandestine opposition to anything environmentally sound, potentially profitable, or new in concept rears  its ugly head in the intervening month to try and sabotage the project – naw, not here in River city, never happen… would it?