CL&P program turns sunlight into dollars Stonington man says ZREC solar program is a winner for his business
The Day, January 4, 2014 – Jonathan Duncklee admits that Connecticut’s Zero Emissions Renewable Energy Credit Program may not be for everyone, but with patience and perseverance and an eye on the future, his heating and cooling business has been able to save between $200 and $500 a month on energy costs, he said.
The so-called Small ZREC Program used by Duncklee offers businesses served by Connecticut Light & Power Co. or United Illuminating Co. the chance to go solar while saving money on electricity costs. What’s more, the program, overseen by the state Department of Energy and Environmental Protection, guarantees that excess clean-power output can be sold back to the grid, turning the money drain that businesses traditionally see in energy costs into a potential money maker.
“I get paid for every (kilowatt) hour produced,” Duncklee said.
Still, Duncklee, vice president of Duncklee Cooling & Heating, admits to not yet seeing a dime because of all the paperwork before the program is fully up and running.
“I’m at the cutting edge, so we’re kind of educating each other,” he said of the process. “It’s so complex.”
Duncklee, who got involved in the first year of the program, had Bonner Electric of Norwich install an 80-foot by 20-foot photovoltaic solar array on the roof of his Taugwonk Road business last spring after being approved for the program earlier in the year.
The full payback for his initial investment in the solar array, taking into account federal tax credits, is five years, he said, and CL&P is contractually committed to buying the energy he produces for 15 years.
“You’re getting a 15-year payment stream,” Duncklee said. “I sell high-efficiency products. I might as well be efficient and clean with my own business.”
Duncklee said his last monthly electrical bill was for $77, far less than many residential customers pay. He added that his cost savings vary depending on the time of the year, estimating that during the winter it might be only $200 but during the sunnier months it could be up to $500.
According to the Geostellar Soar Index, Connecticut’s moderately sunny climate combined with the state’s laws and regulations offer residential customers the fourth highest rate of return when investing in renewable energy sources. The state is currently aiming at 27 percent of its electricity coming from renewable sources by 2020.
In 2011, Gov. Dannel P. Malloy signed legislation directing the state’s two largest electrical companies to launch a program to expand renewable generation statewide. The ZREC progam is part of Malloy’s plan to build an infrastructure in the state that allows for cheaper, cleaner and more reliable energy, according to Alex Kragie, deputy chief of staff for DEEP.
“It’s a great deal for businesses … but it works for ratepayers, too,” Kragie said.
That’s because the program lowers costs by providing a competitive process in which incentives are based on a reverse auction, meaning proposals that provide the lowest prices for renewable energy get state support.
According to DEEP figures, the first year of the process resulted in energy costs of 9 cents a kilowatt hour for consumers – taking into account only the top two tiers of the three-tier ZREC program. The second year, costs were reduced to 6.9 cents.
Kragie said the program is so flexible that paybacks for businesses can be almost immediate, though that would result in smaller returns at the end of the 15-year contract period.
“We are very pleased with the results so far,” Kragie said.