Solar Energy Development on DoD Installations in the Mojave - E2S2

e2s2.ndia.org

Solar Energy Development on DoD Installations in the Mojave - E2S2

Nine Installations in the StudyArmy: 1Fort IrwinNavy: 2NAWS China LakeNAF El CentroAir Force: 3Edwards AFBNellis AFB (including NTTR)Creech AFBMarine Corps: 3MCAGCC Twentynine PalmsMCLB BarstowChocolate Mountain AerialGunnery RangeStudy restricted toland inside installationboundaries includingWithdrawn Lands.Approximately 6 million acres, roughly the area of Massachusetts.icfi.com |4


Conducting the Study• Study supervised by OSD’s Environmental Security TechnologyCertification Program (ESTCP) and conducted by ICF• Experts from ICF’s Renewable ong>Energyong>, Environmental, Defense,Wholesale Power and Transmission practices• Visited every major installation addressed by the study• Hundreds of gigabytes of data collected• Dozens of DoD staff were interviewed during the drafting process– Installations, regional commands, Services and OSD• Documented and analyzed complex policy and programmaticdrivers and restrainers• 266 comments on the draft report from across DoD and otheragencies• Study period February – December 2011icfi.com |6


The Techno-Economic Analysisicfi.com |7


Reduction AnalysisTotal Land Surface• Integrated physicalresource screening,solar modeling andeconomic analysis.• Rapid scenariomodeling• 4 th implementationof the methodologyfor public and privateclientsPhysical screening (mission conflicts, endangeredspecies, cultural resource conflicts, slope,shading, size, geometry, etc.) non-conflictedacreage, buildings, parking lotsRenewable Technology Modeling Technical PotentialEconomic Screening Economic PotentialMW technicallyand financiallyviableicfi.com |8


Physical Screening:Rooftops and Parking LotShading Structuresicfi.com |9


Parking Lot Shading Structure Analysisicfi.com |12


Physical Screening:Ground Sitesicfi.com |13


Screening Process• Geographic Information System techniques used to overlay 20 to 40independent variables per military installation• Suitability rating established for each variable• Most variables were “4”, i.e., elimination factorsicfi.com |14


e all lands within a study area are classified with a singast suitable feature encountered at each location.Suitability Analysis – Worst Score is Final Scoreposite Map Overlay Preserves the Highest Rating (icfi.com |15


Geographic Analysis Steps123• Obtain Regional GIS Data (e.g., from USGS, WRP, ong>Solarong> PEIS, DMG, etc)• Obtain GIS Data (many data layers) from Individual Military Installations andfrom Service-Level or Regional Military Sources• Generate Integrated GIS Model and Map of ong>Solarong> Suitability for eachInstallation45• Review Initial GIS Map with Installation Staff and Other Military Stakeholders• Obtain and Formally Integrate Installation Staff Feedback (includingadditional data layers) into GIS Model6• Generate Final GIS Model and Map of ong>Solarong> Suitability for each Installationicfi.com |16


GIS models developed to implement decision rulesicfi.com |17


Mission Compatibility• The single most important consideration• Military ranges rated Category 4 (Unsuitable) due to missionconflicts – accounted for the large majority of Category 4 acreage• 3 kinds of mission compatibility issues– Security (site sensitivity, access, monitoring)– Physical interaction (live-fire training, maneuver areas, etc.)– Spectrum interaction (weapons, communications, sensors – training andRDT&E): need for a pristine test environment• Security and physical interactions well-understood; spectrum issuesneed further research• Study offers a comprehensive review of mission activities and thesolar compatibility research conducted to date• Technical potential primarily in and adjacent to cantonment areas ateach installation – avoids mission conflictsicfi.com |18


Ft. Irwin/NTC Southern Maneuver TAs/Live Fire Rangesicfi.com |19


Ft. Irwin/NTC Northern Live-Fire TAsicfi.com |20


R-2502 Range Complex – Air Operationsicfi.com |21


Ft. Irwin/NTC Mission Compatibility Summary• North Range– Brigade-scale maneuvers– Direct-fire artillery, CAS targets, live ordnance– Dust• South Range– Large-scale maneuver areas/battle simulation– Dust– Few improved access roads• Goldstone Deep Space Tracking Facility– No physical interaction concerns, but could be spectrum issues; needRFI studies– NASA considering PV project• “Near Cantonment Range”icfi.com |22


Ft. Irwin/NTC Mission Compatibility Resultsicfi.com |23


Ft. Irwin/NTC – Near Cantonment RangesUnsuitable areasinclude ammunitionstorage, slopes >5%,restricted areas,future build-outareas, environmentalcleanup areas,service roads, etc.Much of theadditional exclusionarea defined throughconversations withBase DPW andMaster Planning.icfi.com |24


Ft. Irwin/NTC - Goldstone ComplexMain exclusionfactors includedslope, shading,flood zones andplayas, buffersaround antennas,flora and faunamanagementareas and culturalresource buffers.MGS densitygraded 1-4.icfi.com |25


Hillside Shading Analysis• Not a lot of trees inthis part of the world• Ground-mount sites inthe cantonments wererequired to be >100 ftfrom any building(mostly low-rise)• Ground-mount siteswere required to beshade-free from 9 amto 3 pm on December21, 2015icfi.com |26


Geometric criteria: minimum sizeAll suitable areas (Rating 1) Passed geometry test (Rating 1)icfi.com |27


Technology and EconomicAnalysisicfi.com |28


Technology Analysis• Take 100% of Category 1 area and 25% of Category 2 and 3 area– Eliminate most Category 2 and 3 because of the likelihood of findingreal issues when walking the ground• Build six different solar packages on every acre– Thin-film and crystalline PV x fixed and single-axis tracking– Trough– Dish/Stirling engine• Technical Potential– Equipment specifications (MW of each technology, defines cost)– Hourly electricity generation (drives revenue)– Water consumptionicfi.com |29


Economic Analysis - Framework• 20-year discounted cash flow model• 2015 project date• Applied at the military installation level (expense andrevenue drivers vary across installations) from theproject’s perspective• 5 site types• 6 solar technologies• 2 ownership structures (MILCON and 3 rd party)• Outputs: net present value (NPV) and internal rate ofreturn (IRR)icfi.com |30


Economic Analysis – Cost Elements• Capital (e.g., panels, racking, trackers, BOS, installation labor).Assume 20% cost reduction for panels in 2015 vs. early 2011• Running costs (e.g., O&M labor, insurance, inverter replacementaccrual, decommissioning accrual)• Water cost (CSP)• Land lease rates for 3 rd party owned – 2 models– BLM solar lease rates (differentiated by County and technology)– “Gain sharing” lease rate – cap developer’s IRR at 16% and evaluatepotential for additional rent• Transmission extension costs– Ignored the very real transmission constraints– Priced in costs to reach nearest point of interconnection– Did not model network impact costsicfi.com |31


Economic Analysis - Revenue Elements• Electricity prices (20-year wholesale and self-generationprojection) developed using ICF’s IPM model• REC prices (20-year projection) developed using IPM• Assume all RECs sold to realize ~25% of project revenue.Cheap replacement RECs available• ong>Solarong> incentives taken by private developers (not if MILCON)– Business Investment Tax Credit (30% of capital cost)– Modified Accelerated Cost Recovery System (MACRS) – 6 yeardepreciation schedule– Other California and Nevada state incentives not expected to bematerialicfi.com |32


Southern California Wholesale Power PriceProjections: Background• ICF’s proprietary economic modeling software, Integrated PlanningModel (IPM®) was utilized– Software is used by EPA, utilities, generators, and others to understandshort-term and long-term U.S. electricity market dynamics• Input and other assumptions from EPA’s latest Base Case 4.10• Though physical power and RECs are bundled in CA, they arebroken out in the study for analytic clarity• On-peak and off-peak prices were modeled and utilized in the study;their weighted-average is displayed in graphs here• Projections in real 2010 dollars were converted to nominal dollarsusing 3.66% annual inflation rateicfi.com |33


Modeled Southern California Wholesale PowerPrices for 2015-2034: Real 2010 Dollars$/MWh$120$100$80$60$40$20$02015 2017 2019 2021 2023 2025 2027 2029 2031 2033Firm Physical Power (including capacity scarcity)Renewable ong>Energyong> Credits (RECs)Bundled Electricity (Physical Power + RECs)From EPA’s Base Case 4.10 assumptionsicfi.com |34


Economic Results• Only third-party financing works. MILCON failscomprehensively• All parking lot shading structures failed the economic testdue to cost of building the shade canopy• All technically-eligible rooftop potential was economicallyviable• Almost all technically-eligible ground sites wereeconomically viable for at least one solar technology• BLM ground rental rates could increase and still givedeveloper 16% IRR– BLM’s methodology has important differences from ICF’s– ANPRM for competitive leasing published December 29icfi.com |35


Conclusions andRecommendationsicfi.com |36


Analytical Cautions• The analysis is only as good as the data, which were oftenincomplete, coarse-scale, old, or poorly documented.• Technical and economic potential numbers were based on GIS andeconomic analysis. Reality will inevitably be more complex and theresults smaller.• Within an unclassified study, there were some issues (e.g., missioncompatibility) that could not be as thoroughly explored as we wouldhave liked.• As with any forecast/projection, the results are subject to theevolution of technology, policy and markets.• The potential numbers are an upper limit to show what is possible,however it is extraordinarily unlikely that DoD would need or want tobuild out the full potentialicfi.com |37


Analytical Conclusions• Substantial solar potential available after accounting formission compatibility, environmental and culturalresource conflicts, etc.• DoD needs to work with private-sector developers toensure financial viability• Potential for significant new value to be earned• ong>Developmentong> should accelerated to maintain access tocurrent Federal tax credits• Programmatic scale-up necessary and desirableicfi.com |38


Policy Recommendations• Clarify withdrawn lands policy and land rental formula with theDepartment of the Interior• Work with stakeholders to accelerate transmission development• Clarify DoD policy on REC ownership and accounting• Clarify and develop programs to achieve energy security goals• Increase coordination and integration of renewable energy projectsand initiatives among military installations and Services• Develop a consistent and incentive-focused formula to allocateproject benefits and costs between the host installation and parentorganizations• Develop methodology for solar mission compatibility analysis,especially for spectrum interactionsicfi.com |39


Developer Considerations• Need to consider the relative attractiveness of developing on DoDcontrolledland vs. BLM-managed and private land– Explicit or implicit land rental costs– Infrastructure availability– Effective, motivated counterparties with fast, smooth, predictableprocess• Can a wholesale-competitive project be sited on DoD installations?• Potential to serve significant (tens of MW) onsite load with higherpayments than wholesale market participation• Opportunity to combine with microgrids, storage, other technologiesicfi.com |40


DoD Considerations• Protection (and if possible, enhancement) of mission performance– Installation energy independence and security (but requires more thanjust solar)• Revenue or in-kind consideration, preferably with some remaining atthe installation• Mandate compliance is in third placeicfi.com |41


Recommended Next Steps• “High-grading” and further development of best solar opportunitiesidentified by the study.• Continued/accelerated work on policy and programmatic barriers• Scale-up of DoD’s program management resources• Conduct similar multi-disciplinary analyses for other renewableenergy resources, and in other areas (DoD lands, BLM lands, etc.)– Identify most suitable areas– Minimize wasted investmenticfi.com |42


ThanksBob KwartinVice PresidentICF International9300 Lee HighwayFairfax, VA 22031rkwartin@icfi.com703-934-3586703-934-3530 faxwww.icfi.comicfi.com |43

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