SaskPower has developed a program for smaller investors who want to get involved in the green economy. The program is called the Small Power Producers Program.
Solar Plantation has found a way to use this program for community owned solar, whereby community members can build a system up to a maximum size of 100 kW, connect it to the grid, and under an offered Power Purchase Agreement get paid for the power at a guaranteed rate for 20 years. The guaranteed rate for generated solar is 10.82 cents per kWh, escalating at 2% per year over the 20-year life of the project. The start of development is recommended to occur in the 2017 calendar year. The program was put in place several years ago and is likely to be revised in the 2018, which is limiting the window of opportunity.
Solar Plantation Inc. is a Saskatchewan company that has found two excellent sites that have the attributes that make the build out of such systems very lucrative under the Small Power Producers Program. These sites are located in Maple Creek and Shaunavon.
The attractive attributes are:
1. Land that is close proximity to a power distribution lines so taping into the grid is inexpensive
2. A land location and configuration that gets excellent access to the sun on a yearly basis
3. Town councils that are supportive of such projects
4. The right soil conditions that make the installation of ground mounted systems viable
5. Land that is close to existing roads for ease of access during construction
By using our testing equipment, Solar Plantation has conducted soil stability and acidity testing on both sites to ensure piling stability and the minimal effect on the galvanized steel pilings over the expected 20-year project life cycle.
SaskPower interconnection studies have been completed for some segments. Each 100KW system project is considered a segment. For those approved segments we are ready to sign Power Purchase Agreements and proceed with the construction right away.
Solar Plantation has negotiated the use of the land for these systems and is looking for community members to join them in the build-out of the projects. An individual or company can own each segment. If it is a company, that company could have multiple shareholders, with all shareholders combined owning a 100KW segment. The more community members invest in the proposed solar farm, the better returns on investment everybody would experience.
The land in Maple Creek is estimated to support up to 15 segments and the land in Shaunavon is estimated to support up to five segments. Solar Plantation will be the owner of one of these segments and will be proceeding with the steps to build that segment as soon as possible. The remaining segments are available for purchase at an approximate cost of $210,000.
With the 20-year guarantee from SaskPower, the average cash flow on this investment could be as high as $19,000 per year for 20 years with a rate of return of up to estimated 8.4%. The anticipated return is the net cash flow after accounting for the costs of maintenance, property taxes, and insurance.
Solar Plantation will work with each community member to prepare a detailed business plan for that member, taking into account their tax position and how they want to buy the segment.