TRAVERSE CITY — The future of Traverse City's green energy goal is looking brighter than ever.
Traverse City Light & Power officials recently voted to approve a special green rate for the city as part of a deal where the city will buy the output of Heritage Sustainable Energy's planned solar array, TCL&P Executive Director Tim Arends said.
The city will pay an extra 0.2 cents per kilowatt-hour for all municipal operations, Arends previously said. That amount represents the difference between the cost of the solar array's energy and the utility's avoided cost in buying it. TCL&P will adjust the surcharge every year of the 20-year, fixed contract, and the surcharge could become a credit if prices for power on the open market rise.
City leaders voted in July to buy the solar array's output as a means of furthering the city's goal of powering all government operations with renewable energy by 2020, as previously reported. Energy from Heritage's 1-megawatt solar array will push the city's green energy consumption to 21 percent from the current 10 percent. It's planned for land along M-72 near a wind turbine the company also owns.
TCL&P, Heritage and city officials had signed off on the agreements as of Wednesday, Arends said. The utility also has contracted an engineering firm to seek bids for power grid enhancements needed to get the solar array's output on the utility's system.
"So we're good to go, we're waiting for the project to be installed," he said.
Construction on the array should begin within two weeks, Heritage CEO Marty Lagina said. It should be operational by Oct. 1.
Heritage Sustainable Energy hazarded that city commissioners intended to move ahead with the deal, and ordered solar panels before the city approved it, Lagina said. The company's contractor has started to take delivery of the panels.
"We took a chance that the city was serious, and they were," he said. "They put their money where their mouth is, and we took a chance on that and ordered all of this stuff months ago."
TCL&P will ask the Downtown Development Authority and the utility's own board if they want to participate in the green rate, Arends said.
Bill Golden, DDA board chairman, said he didn't know enough about the subject to comment.
TCL&P board Chairman Jan Geht said he's not in favor of the utility paying the green rate for its own operations. He'd rather find out about offers from other companies, especially Spartan Renewable Energy. The agreement between Heritage and TCL&P isn't contingent on the utility or DDA agreeing to the green rate as well.
"It's really more of government units having the opportunity to claim that source of energy as properly theirs, and we may choose that we want to claim a different renewable energy source as ours," he said.