Page 197 - Sustainable Cities and Communities Design Handbook

Solar Power and Energy Conservation as Solutions Chapter j 9 171

cumulative output guarantee in year 3 is 4,193,486 kW h. The actual delivered
cumulative output is 4,100,000 kW h. The shortfall is therefore 93,486 kW h. The
PPA rate is $0.14333 per kWh in year 3. The shortfall payment paid by Power
Provider to Purchaser is $624 (93,486 kW h x [$0.15 - $0.1433] ¼ $624).

Lease of Photovoltaic System
The Los Angeles Department of Water and Power (“DWP”) has instituted a
Solar Photovoltaic Incentive Program (the “Incentive Program”) consistent
with the California Solar Initiative set forth in Senate Bill One (SB 1, Murray),
which was approved during the 2005e06 Legislative Term with the goal of
installing 3000 MW of net-metered solar energy systems by December 31,
2016. On December 6, 2016, DWP agreed to continue the Incentive Program
and implement a new program, which effective January 3, 2017, reduced in-
centives of Government/Nonprofit organizations from $1.15 per watt to $0.95.
Public Utilities Code section 2854(b) requires that on or before January 1,
2008, a local publicly owned electric utility must offer monetary incentives for
the installation of solar energy systems of at least $2.80 per installed watt, or
for the electricity produced by the solar energy system, measured in kilowatt
hours, as determined by the governing board of a local publicly owned electric
utility, for photovoltaic (PV) solar energy systems. The incentive level is
scheduled to decline each year thereafter at a rate of no less than an average of
7% per year.
For a local publicly owned electric utility to institute a solar energy pro-
gram, Public Utilities Code section 2854(d) requires the program to be
consistent with all the following:
(1) That a solar energy system receiving monetary incentives comply with the
eligibility criteria, design, installation, and electrical output standards or
incentives established by the State Energy Resources Conservation and
Development Commission pursuant to Section 25782 of the Public
Resources Code.
(2) That solar energy systems receiving monetary incentives are intended
primarily to offset part or all of the consumer’s own electricity demand.
(3) That all components in the solar energy system are new and unused, and
have not previously been placed in service in any other location or for any
other application.
(4) That the solar energy system has a warranty of not less than 10 years to
protect against defects and undue degradation of electrical generation
output.
(5) That the solar energy system be located on the same premises of the end-
use consumer where the consumer’s own electricity demand is located.
(6) That the solar energy system be connected to the electric utility’s elec-
trical distribution system within the state.