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Aerial view of project site, Dec. 4, 2008.
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The Oregon Department of Transportation is an agency on the move – to renewable energy. It takes 45 million kilowatt-hours of electricity annually to run Oregon’s state transportation system, energy used for signals, illumination, buildings, ramp metering and more, at a cost last year of more than $4 million. Today this energy comes from mostly non-renewable sources, but change is coming.
On Feb. 21, 2008, the Oregon Transportation Commission directed ODOT’s Office of Innovative Partnerships to develop a procurement for up to 2 megawatts of solar energy on ODOT properties, including along the state highway right of way and the interstate system. Leading the way will be the Oregon Solar Highway demonstration project, a public-private partnership with Portland General Electric and US Bank, to build the first-in-the-nation solar array in a freeway interchange. Groundbreaking took place Aug. 7, 2008. Physical construction is expected to begin in mid-September.
Solar Installer Contact Information
ODOT is compiling contact information for solar installers interested in completing solar photovoltaic projects for ODOT and will share that contact information with other state and local agencies for subsequent procurements. If you would like to have your contact information included, please complete the survey (link below).
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This is an “all Oregon” project – Oregon companies will supply materials, design and install this collaborative project, showcasing what can be accomplished through creative, responsible partnering in the public and private sectors.
The 104 kilowatt ground-mounted solar array will be situated at the interchange of Interstate 5 — a federally designated Corridor of the Future — and Interstate 205. The solar panels will be supplied by SolarWorld AG of Hillsboro and the inverter will be supplied by PV Powered Inc. of Bend. The project will be designed, constructed and installed by SolarWay, a “turn-key” solar energy EPC (Engineer/Procure/Construct) consortium consisting of four Oregon firms: Aadland Evans Constructors, Inc. of Portland as the general contractor; Moyano Leadership Group, Inc. of Salem as the project manager and design leader; Advanced Energy Systems of Eugene as the solar power specialty designer and installer; and Good Company of Eugene as the community and sustainability specialist.
The Good Company, Moyano Leadership Group, and AES are certified as emerging small businesses in Oregon, and Moyano Leadership Group is further certified as a woman-owned business.
The concept of generating solar electricity in the highway operating right of way is of keen interest to solar industry providers, as well as state and federal elected officials, the Federal Highway Administration, the Oregon Department of Energy and the U.S. Department of Energy. While “roadside solar” has operated successfully for almost 20 years in Europe, it has never been attempted in the United States; Oregon will be the first. With its commissioning, the Oregon Solar Highway project will extend not just Oregon’s role as a leader in the development of alternative energy resources, it will also showcase the Oregon Department of Transportation’s vision and leadership to creatively meet the energy challenges ahead.
Portland General Electric deserves special recognition for their contribution to this innovative project. Without the Corporate willingness to step out in front of pack and partner with ODOT, this project could not have happened.
Further recognition is given to Lynn Frank, president of Five Stars International, an Oregon management consulting and professional services firm, for his crucial role in bringing this project to life. Among other contributions, Mr. Frank provided project direction, technical and regulatory energy expertise.
Background
In Oregon, 2007 was a landmark year for renewable energy legislation. Among many energy bills, House Bill 3201 increased the Business Energy Tax Credit (BETC) for renewable energy projects from 35 percent to 50 percent and House Bill 3543 directed Oregon to arrest its growth of greenhouse gas emissions by 2010. Governor Ted Kulongoski further directed state agencies to meet their electrical needs with 100 percent renewable resources. Given the constitutional limits on allowable uses of the Highway Fund, this directive is particularly challenging for the Oregon Department of Transportation.
Fortunately, innovative financing mechanisms using public-private partnerships are available which can allow ODOT to secure clean, renewable energy – without paying a premium – from assets it already owns. These public-private partnerships utilize the 50 percent state BETC and the 30 percent federal investment tax credit, along with utility incentives (available in PGE and PPL territories) to finance projects, credits which ODOT, having no tax liability, cannot take advantage of on its own. Purchasing power in this manner also provides the potential for ODOT to pay below market rates for the energy, resulting in more funds available for mission-critical needs.
The Procurement
The objective of the solicitation is to procure the generation of at least 2,000,000 kilowatt hours per year of renewable electricity from ODOT-owned rights of way, properties, facilities and other built assets, at no greater cost than ODOT is currently paying for power. The successful third party or parties will construct at their own expense, own, operate and maintain the solar systems and sell all electricity generated by the systems to ODOT under a Power Purchase Agreement (PPA), for a term from 6 to 20 years, or longer.
The initial procurement will be limited to Portland General Electric territory, with installations in other utilities’ territories to follow upon the success of this first procurement. A successful solicitation could result in scalable and repeatable solar installations on other suitable ODOT properties around the state.
The proposed solicitation to develop solar resources will consist of a two step process. The first step will pre-qualify a short list of bidders and award the first two or three “bid basis” solar installations to the highest ranking proposer. The second step will open additional sites for bidding by the short listed companies. This allows ODOT to develop its solar resource on a competitive basis without requiring a request for proposal for each project — the pre-qualified company with the best bid per offering will be awarded the installation(s). Solar project sites will include operating right of way, sound and retaining walls, ground, pole, and roof mounts.
The solar companies will be wholly responsible for all costs of each solar installation, including but not limited to design, permitting, construction and commissioning of the systems. The companies will also be wholly responsible for maintenance and successful operation of the arrays, including any damage due to vandalism or crashes.
The Oregon Department of Justice has advised ODOT that securing renewable energy through use of ODOT rights of way and facilities is an allowable activity, as long as the energy generated is offsetting ODOT’s use of electricity.
Policies and strategies adopted in the Oregon Transportation Plan support this renewable energy project. Policy 4.2 – Energy Supply, states that it is the policy of the State of Oregon to support efforts to move to a diversified and cleaner energy supply, promote fuel efficiencies and prepare for possible fuel shortages. Strategy 4.2.1 directs ODOT to support efforts to move toward a diversified and cleaner energy supply.
ODOT is not allowed, at this time, to generate more electricity than it uses and sell that electricity at a profit. This is not of immediate concern, however, since it is estimated that approximately 120 miles of solar installations on the right of way will be needed to offset ODOT’s annual electrical use of 45 million kilowatt hours.
What’s the Timeline?
ODOT is working with an energy and utilities consultant, Five Stars International, to develop the procurement. The department is concurrently identifying potential sites along highways and freeways – and on building roofs and facility grounds – for installations. Sites must be cleared related to environmental and operational impacts, and the maximum allowable energy generation identified.
ODOT is acutely aware of the Dec. 31, 2008, sunsetting of the 30 percent federal investment tax credit; a successful procurement is dependent on extension of this tax credit.
Research
ODOT has contracted with Good Company to evaluate technical, environmental and sustainability aspects of the Oregon Solar Highway demonstration project and solar energy in general. The resulting documentation follows:
Posted August 7, 2008
For more information, please contact:
Allison Hamilton, Project Director
Office of Innovative Partnerships and Alternative Funding
Oregon Department of Transportation
Phone: (503) 986-3732
Fax: (503) 986-3679
E-mail: allison.m.hamilton@odot.state.or.us
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