Success Story

Large University Saves Millions with Solar RFP Process

university fall scene

For well over a decade, Usource has been the trusted energy advisor to a large Midwestern University. With sustainability becoming a larger priority, the University worked with Usource to procure renewable energy credits (RECs) and analyze and contract on hydroelectric Power Purchase Agreement (PPA). When approached with a unique opportunity to contract with a solar project located close to the main campus, the University was uncertain whether this would be the most cost-efficient solution, if it would offset enough of its current electricity usage and if it would enable the University to meet its sustainability goals. The University shared their concerns with Usource and asked for help in evaluating the feasibility and benefits of the proposed project.

Usource leveraged its proprietary analytics platform to employ strategic insight into the sustainability and economic objectives of adding a solar resource into the University’s electricity procurement portfolio. Working alongside the University’s team, Usource identified the key criteria for evaluation which included geographic considerations, environmental additionality, contract terms, electricity volumes, and price tradeoffs, and the technological options for receiving solar energy. In the University’s area, both the state and the ISO rules for renewable energy were in the process of changing, so correctly interpreting the impacts of these changes on the value of capacity and the environmental attributes from the project was critical.

With the key criteria determined, Usource utilized its Request for Proposal (RFP) bid platform to obtain proposals from a number of solar developers. Upon receiving proposals, Usource worked with several developers to clarify, refine, and evaluate the bids based on the project criteria and collaborated with the University to help make the ideal selection. With a developer selected, Usource then provided insights into the critical areas to be addressed in the PPA in order to position the University to meet its objectives and manage risks.

By using the Usource RFP process, the University will save $8,394,000 over the 20-year period, versus the original proposal. The system will provide over 10% of the University’s annual electricity use. Along with the hydro project, the University is positioned to have roughly 40% of its current annual electricity needs met by local renewable power sources. As its trusted energy advisor, Usource continues to work with the University to reduce energy costs and achieve its long term commitment to becoming a carbon-neutral campus.

The University is a sophisticated energy buyer, but they had limited experience with renewables and renewable energy contracts. While the project savings would be significant, there were commercial risks associated with the PPA. In working with our Consulting Director of Renewable Energy, Steve Birndorf, we were able to help the University quantify and mitigate risk, negotiate a better economic deal through the RFP process and negotiate contractual terms that were fair and reasonable.

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