Don’t Be Fooled By Solar4Schools Programs

Prior to American Experiment’s presentation to the Minnesota House of Representatives Committee on Job Growth and Energy Affordability on our report “Energy Policy in Minnesota: The High Cost of Failure,” IPS Solar, a company that installs solar panels, testified in front of the committee stating its “Solar4Schools” program can help schools (and therefore taxpayers) save money and also get children interested in science.

While it may seem like this would be an effective way to reduce energy costs for schools (and therefore save money for taxpayers) this program is a bad deal for Minnesotans because it is simply a shell game, transferring costs from Column A, over to Column B, with a healthy mark-up for the solar and utility companies.

Here’s how it works:

Your Property tax bill may go down, but your electricity bill will go up:

Electricity generated from community solar and rooftop solar systems is very expensive. As per the testimony on March 20th, these types of solar systems produce electricity at a cost of around 14 cents per kilowatt hour, as an Xcel Energy representative at the meeting notes at the 30:20 mark:

“The solar gardens are one of the more expensive ways to produce energy. I haven’t seen our latest numbers, I know last year we were talking $140 per megawatt hour (14 cents per kilowatt hour). 

I will say, rooftop solar is not tremendously cheaper than that, both rooftop and solar gardens are expensive ways to produce electric energy. They help the customer who gets it [installs the panel on their rooftops], and would help the school districts.”

For perspective, the average wholesale cost of generating electricity from an existing coal or natural gas plant is 3.9 cents per kilowatt hour for existing coal plants, and 3.4 percent for existing natural gas plants. This means generating electricity from these panels costs about three to four times more to create than conventional sources of electricity.

School districts may benefit, but this additional cost is foisted upon everyone who pays electricity bills, as noted in a past post by Tom Steward:

“Xcel passes those additional costs onto all of its consumers by charging them more for fuel. For every 100 MW of community solar that comes online, it costs customers an additional $17 million, [Lee ]Gabler [ Xcel Energy senior director of customer solutions] said.”

This policy may invoke warm fuzzy feelings, but in the end, any savings the school district realizes on their electricity bills will simply be transferred from property tax bills to electric bills, at a markup.

In short, this policies like these mean Minnesotans will have less money in their bank account. There are much more affordable ways to spark interest in math and science.

Perhaps a fieldtrip to a solar farm would be a much more cost-effective way teach students about expensive forms of electricity.