City Council has narrowly defeated a deal to build a solar panel array in the northwest part of the city.
While proponents say the project is environmentally friendly and would save the city between $35,000 and $66,000 per year, opponents say the savings is minimal and the risk too high for the city to back the project.
City Council on Oct. 16 voted 4-3 against entering a 25-year solar power purchase agreement and property easement pact with Hudson Shines LLC that would have allowed the company to build a solar panel system on approximately 15 acres of city-owned land at 996 Hines Hill Road. The site is on a portion of the former Youth Development Center property.
Council members Beth Bigham, Hal DeSaussure, Dennis Hanink and Alex Kelemen voted no, while members Casey Weinstein, Dr. J. Daniel Williams and President Bill Wooldredge voted yes.
DeSaussure said he rejected “the notion that not doing this project is not environmentally sensitive.” He said the city already purchases 20 to 25 percent of its power from renewable resources, and the city could “bump that figure up” by “doing something meaningful.”
“I don’t think that saving $66,000 [per year] on an electric purchase is environmentally sensitive,” said DeSaussure.
Weinstein said the contract states that following the 25 years, the land would be returned to the city in its “current state.” He said the land in question “has sat vacant for many years. We don’t have any interest from any parties in that particular piece of the property.”
While noting the estimated cost savings in the first year are “relatively minimal,” Weinstein said the benefit to Hudson Public Power customers is that over time, the city will not pay the “dramatically increasing” transmission costs on the power that it’s producing “now independently behind our grid.”
“When you project those savings out, it becomes substantial for us,” said Weinstein. He said the company was planning to donate 10 percent of profits back into local nonprofits and added that savings over time can be put toward the city’s connectivity plan.
“It’s a first step in the right direction that we can take,” said Weinstein.
DeSaussure said the land eyed for the solar project is a “beautiful property.” If the property cannot be developed, he said it should be converted into usable green space.
Hudson Shines LLC, which was formed by Depcom Power and Better Together Solar for this project, had planned to design, construct, own and operate a 2 megawatt solar panel system and then sell the energy to Hudson Public Power, according to city officials.
City Solicitor Matt Vazzana said Hudson Shines LLC would have been responsible for the cost of installing the solar panels and the removal of infrastructure if the contract is terminated. He said that while the city had not negotiated the terms of Hudson Shines’ financial guarantee, the contract stipulated that a guarantee had to be in place before the project could begin.
Wooldredge said Hudson Shines LLC is a “single-purpose LLC” and that the firm’s financial guarantee is “only as good as whatever stands behind it.” He told Vazzana “we’ve got to make very certain that that cash is there for the bond. Otherwise, we’re not protected at all.”
DeSaussure questioned how the financial guarantee figure would be determined and wondered whether the city would know the expected equipment removal costs in 25 years.
Mayor David Basil said officials would be taking their “best stab at what that cost will be in 25 years.”
DeSaussure expressed other concerns about the agreement.
“I don’t know what is going to happen in 25 years, but it would not be difficult for Hudson Shines LLC to cease existence at the end of 25 years and then walk away from a 15-acre solar array, at which point we are looking at how to get rid of it,” said DeSaussure.
DeSaussure said the project was estimated to decrease the city’s annual power purchase costs by anywhere from $35,000 to $66,000. The city this year has budgeted $15.8 million for that expense.
“I’m not going to support this if there’s a shred of risk on the part of the city,” Hanink said.
Bigham said city staff in the previous week’s workshop acknowledged that they had not fully understood the numbers.
“That’s a wise thing to heed caution when we realize that we don’t understand something and numbers are changing rapidly,” said Bigham.
Noting that Hudson Public Power’s revenues are “up in the millions,” Williams said the project has “very little impact, but it’s a signal of what we could do in the future.”
“I would call this an exhibit of solar energy,” added Williams. “And I think it’s worth supporting.”
Before council voted, Ashley Drive resident Jeff Wells, who chairs the Hudson Environmental Awareness Committee, spoke in favor of the project.
“This solar project is a great initial project that will save Hudsonites money,” stated Wells. “It could lead to additional home-grown power generation by Hudson Public Power that increases Hudson’s energy independence.”
