Receive an update on the strategy for existing and future county-owned solar generation facilities and provide direction to staff. (No general fund impact) (Pistochini) (Est. Time: 15 min)

Receive an update on the strategy for existing and future county-owned solar generation facilities and provide direction to staff.

The County owns several solar generation facilities to reduce electricity bills and generate revenue.  Many of these facilities were built over ten years ago.  Additionally, an opportunity exists to add new facilities to further reduce electricity costs and also has the benefit of reducing carbon emissions.  This item will provide the Board with an update on the status of the existing arrays and details about where future arrays may go.

Existing Solar Facilities
The County has three major existing solar facilities: Justice Campus, Beamer/Cottonwood Campus, and Grasslands.  These facilities were installed in the early 2010s.  All facilities have recently seen a series of changes in contracted operations and management agreements - SunPower, which installed the facilities, suddenly exited the O&M space and their contract with the County was assumed by Total Energies. (SunPower subsequently declared bankruptcy.) The transition to Total Energies has been difficult due in part to differences in the technology used by them and SunPower. Total Energies was finally making headway on the O&M work, but recently notified the County of a shift in strategy and is ending support at the end of February 2025.  The County is preparing to issue a solicitation to find a new solar management firm.  The purpose of the firm is to coordinate solar field repairs, monitor production, resolve regulatory issues, arrange for panel cleaning, and arrange for vegetation management.  The County does not have any in-house expertise to perform this work and must contract this out to ensure optimal performance of the solar facilities.  Currently, these solar facilities are overseen jointly by the County Administrator's Office and the General Services Department. CAO staff provides administrative support and GSD provides facilities support.

Justice Campus
The Justice Campus solar facility is located next to the Monroe Detention Center and Juvenile Detention Facility.  Its production offsets the electricity use at the justice campus.  During construction of the new jails, the solar facility was turned off to protect the construction workers. Upon seeking to resume operations of the solar facility, it was clear that there were technical issues that needed repair and the facility was returned to its offline state.  During the course of seeking a contractor to investigate the issue, the solar facility experienced technical failure and a fire occurred twice.  Further investigation found problematic components that failed and were isolated.  The County staff are working to strategize the repair of this facility.  The solar contractor market is under high demand and the County has contacted four potential vendors about the repair with varying degrees of response.  County staff are coordinating with our insurance agency, Yolo County Public Agency Risk Management Insurance Authority, regarding repair costs.

Beamer/Cottonwood
The Beamer/Cottonwood solar facility is located by the County's fleet corporation yard and the Bauer building.  This facility offsets electricity use at these buildings.  The facility has experienced inverter failures, causing production to be approximately half of the projected amount.  The turnover in O&M operators disrupted the timely repair of this facility. Additionally, the market for solar components is heavily burdened, making the securing of necessary parts a long process.  However, this is expected to be resolved by the end of February 2025, and the contractor has made noticeable efforts on this topic.

Grasslands
The Grasslands solar facility is located in the northwest corner of the Grasslands Regional Park.  This facility is split between two arrays - one providing on-bill electricity production credits and the other is a production generator selling electricity to the California Independent System Operator (CAISO) market.  The production generation arrangement was advantageous when the array was first built as the demand for solar generated electricity was high.  Since the contract expired, the array is selling power on the open market and demand for solar generated electricity is low due to market saturation.  The General Service Department is currently working with Pacific Gas & Electric and the County Administrator's Office to explore moving this array to the on-bill electricity production credit program to maximize the value of the electricity.  Additionally, the process of selling electricity to the grid is complicated and converting it to on-bill credits reduces the County's administrative and financial risk. 

Grasslands experienced a large ground fire of undetermined origin in June 2024.  The facility was placed offline as County staff worked to investigate the damage.  Approximately 20-25% of the facility that escaped damage is restored to production status.  Several vendors were approached to estimate the cost of system repair.  Estimates vary wildly from $450,000 to under $1,000,000.  The County is considering an alternate approach to contract with an electrical engineer to design the repair and then separately solicit the work.  County staff are coordinating with our insurance agency, Yolo County Public Agency Risk Management Insurance Authority, regarding repair costs.

Grasslands has an additional issue regarding an alleged violation of the deed restriction the Federal Government imposed in transferring the park property to the County in 1973 at no cost. The transfer deed prohibits any use of the property that does not support public recreation. The federal government has interpreted the solar site as a violation of this restriction and, even before the solar project was constructed, had agreed to extinguish the deed restriction in exchange for payment of fair market value for the approximately 25 acre solar site. Various complications later arose that delayed final action on the restriction, but staff expect a Board item on this matter toward the end of the 2025 calendar year.

Future Solar Generation Opportunities
Over the past year, the California Public Utilities Commission (CPUC) has worked towards revising a solar-friendly rate structure called Net Energy Metering (NEM).  NEM allows the crediting of excess solar production at a value greater than the cost of production.  Last year, the CPUC closed the second version of NEM, called NEM 2.0, to new applications.  The County submitted three applications at no cost or obligation for new solar facilities at the Beamer/Cottonwood facility to serve the Community Services buildings (~206 kW system), the Justice Campus to provide additional electrical savings (~720 kW system), and the Buckeye/Imperial campus to serve the Central Library and General Services facilities (~173 kW system).

The County has begun no-cost or obligation discussions with Engie to review the solar potential for cost and construction.  After discussing with the Board's Committee on Capital Investments, staff is engaging with several companies on the California Department of General Services on-call Energy Services Companies to foster competition.  The staff is engaging with Valley Clean Energy to see if VCE can provide an independent review of proposals to determine if the County is getting the best value.  VCE is currently reviewing the proposal and has recommended two independent third party energy review companies to consider to assist the County's evaluation of the proposals.  California Government Code Sections 4217.10 through 4217.19 provides a procurement method to obtain energy services.  The County can select a contractor utilizing the pool of qualified energy service companies established by the California Department of General Services on the basis of experience of the contractor, technology employed by the contractor, cost to the County, and any other relevant considerations.  A public hearing with public notice is required prior to entering a contract to determine if the anticipated cost to the County to contract for solar/energy services is less than the anticipated marginal cost to the County of the electricity that would be otherwise consumed by the County.

Next Steps/Summary of Upcoming Action Items
As detailed above, staff are working on a number of action items related to current and future solar.  The following list is a summation of the action items listed above:

The County Administrator's Office currently manages the Yolo Electric Solar Program.  The General Services Department is providing support to resolve issues with the existing solar facilities and is evaluating future solar facilities.  The County Counsel's Office is involved in resolving the Grasslands land issue with the Federal Government.  The Department of Financial Services is involved in discussions about the cost to resolve the existing solar facilities and on future solar opportunities.

As mentioned earlier, County staff are committed to following the process in the California Government Code to select an energy services contractor that provides best value to the County.