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Local nursing home celebrates solar panel installation

By DeeAnna Haney • SMN Intern

Perched atop a Canton nursing home roof, gleaming in the sun is the newest addition to the building, bringing it to the forefront of the green initiative in North Carolina.

Silver Bluff Village held a ribbon-cutting ceremony last week to celebrate the installation of a new solar energy system. It is the first nursing facility in the state to harness the sun for the building’s hot water needs.

Provided by SolTherm, a clean energy services firm based in Asheville, the 32 4-by-10 foot panels will provide up to 50 percent of the facility’s hot water consumption including bathing, cooking and other dietary requirements.

When SolTherm first approached Silver Bluff owners Bob and Lisa Leatherwood about how a solar energy project could benefit the 195-bed nursing home, the couple had already committed to reducing energy usage by replacing their plumbing fixtures, all light bulbs and upgrading their wastewater treatment facility.

The idea of using alternative water heating sources had crossed their minds during this building transformation two years ago, but they were sure the project would be far too expensive.

But SolTherm’s research results on the building quickly changed the couple’s minds. The company found that a solar hot water energy system would reduce the nursing home’s energy costs by 10 percent immediately, saving them an estimated $315,000 over 20 years if they participated in the NoCapEx program. (This number is assuming propane prices continue to increase at six percent each year).

Bob Leatherwood said he first thought it was too good to be true. With NoCapEx, the company promised to front the solar panel equipment and installation with no upfront cost to Silver Bluff. In return, the Leatherwoods were asked to sign a 20-year contract and pay a monthly fee.

After SolTherm’s proposal, Lisa Leatherwood said the decision to install was a “no-brainer.” “All we had to do was provide the building,” she said.

The Heliodyne solar panels capture the sun’s thermal energy by heated fluids in the solar collectors and then send it to heat exchangers. The solar heated water is then stored in a 2,000-gallon tank and can be used throughout the day.

According to SolTherm’s Web site, SolTherm.com, traditional hot water heaters waste as much as 35 percent fossil fuels. The solar panels work to reduce the use of a hot water heater thus saving money and environmental impact.

“This is something we would encourage anybody to look at and we’re very excited and glad to be an example in the community,” Bob Leatherwood said at the ceremony.

Lisa Leatherwood said she is pleased with the results of the solar panels already. The online monitoring system inside the building that tracks the system’s progress reads the facility has saved 225 trees, 221 gallons of gas and 6,746 vehicle miles to date.

“We’re proud to reduce our carbon footprint, create jobs and of course save money,” she said.

HCC has very little risk on green energy venture, say experts

Alternative energy has emerged as a sticking point in the debate over a proposed $10 million creative arts building at Haywood Community College.

The project is in limbo as it awaits approval from county commissioners, who have expressed reservations for the past several months over the building’s price tag. Critics believe college leaders are being overzealous in their pursuit of eco-friendly building features, and the cost is being driven up as a result. They fear HCC is pushing the envelope with cutting-edge solar technology, making it a guinea pig in the alternative-energy field.

But supporters say the alternative energy features are smart. They will save the college money over the long run for no additional upfront cost, allowing the college to “go green” risk free and even benefit financially.

The Haywood Community College Board of Trustees voted 6 to 5 last month to include a solar technology in the building design. The final decisions now rests in the hands of county commissioners.

At a public hearing on the project last week, county commissioners pressed the project’s lead architect and an alternative energy firm engaged to install the solar technology to explain how it would work. The Smoky Mountain News conducted follow-up interviews with the firms, as well as experts at the N.C. Solar Center housed at N.C. State University, to get answers on all the solar aspects of the project — and then some.


What kind of alternative energy are we talking about?

The design calls for three technologies: solar thermal for hot water and heat, solar thermal for air conditioning and solar panels for electricity.

Solar panels are nothing new. Mounted on the roof, the panels convert the sun’s rays to electricity.

Solar thermal uses the sun to heat water flowing through coils on the roof, which in turn provides hot water for the building. Hot- water pipes also run beneath the floor to provide radiant heating in the winter, similar to a radiator.

For the air conditioning, solar thermal heat will be used to power an absorption chiller.

How much does all this cost upfront?

Nothing. Sounds too good to be true, but HCC pays nothing. A private alternative energy firm, FLS Energy, will pay for the solar thermal system and solar panels.

“We finance the project, we design it, develop it and install it,” said Michael Shore, CEO of FLS Energy.

Why would FLS do that?

FLS will make money by selling energy to HCC and to Progress Energy over the power grid.

“We are like a little tiny utility on their roof,” Shore said.

FLS will get a bank loan for the up-front costs of the equipment and pay off the loan by selling the power. In about 10 years, FLS will have recouped its costs.

“It is a good business investment for us. Over the long term we pay off the debt and make a profit,” Shore said. “The financial arrangement we have done many times with very successful results.”

Where do tax credits come in?

State and federal tax incentives for solar energy are a critical piece of the puzzle for FLS. The venture wouldn’t be profitable without them.

But FLS doesn’t have enough tax liability of its own to fully monetize the tax credits. So a third-party investor is brought in to the venture to make use of the tax credits.

What does FLS sell to Progress Energy?

Unfortunately, FLS can’t sell electricity generated from the solar panels directly to HCC. Utilities have monopolies in their territory.

“In North Carolina the only entities you can buy electricity from are the utilities,” Shore said.

So the solar electricity will be sold to Progress. A new state energy bill requires Progress to generate a portion of its electricity from renewable sources. That means Progress is not only willing to buy the solar power from FLS, but will pay a premium for it — another critical element in the business model for FLS.

Meanwhile, FLS will pay HCC for the privilege of housing the solar panels on its roof. While HCC will have to buy its electricity the regular way, its power costs will be offset by the regular payments from FLS.

What does FLS sell to HCC?

FLS can, however, sell energy generated by the solar thermal system directly to HCC. Solar thermal energy is measured in heat units known as BTUs — so it is technically more like natural gas than electricity. FLS will charge HCC for the BTUs it uses.

What will the college pay FLS for the BTUs?

Whatever the rate is, it will be lower than what HCC would pay for comparable power on the open market, and it is locked in through a contract and not subject to rising energy costs.

“It does save them a significant amount in energy cost during the contract period,” said Dale Freudenberger, president of FLS. “It will absolutely be saving them money.”

If it is such a sure-fire business model, why aren’t more people doing it?

It sounds too good to be true. There’s no upfront costs or risk for HCC. The college even reaps savings on its power bills and gets kickbacks from FLS — thus making money while “going green.”

“It turns out to be a pretty good deal,” said Tim Lupo with the N.C. Solar Center.

A progressive state energy policy has only recently set the stage for arrangements like this one. Big utilities in North Carolina must now get a portion of their power from renewable sources.

The financial arrangement like the one between FLS and the college is increasingly common, according to Lupo. But the tax credits and alternative energy mandates are new, and firms like FLS are just now starting to figure it out.

What happens when FLS has recouped its costs?

In 10 years, HCC will have the option of buying the entire solar power system. It will have another 20 years of life left at that point before the efficiency begins to degrade.

If HCC buys all the equipment, it can make its own energy, divesting itself of monthly power bills and making money by selling surplus power to Progress.

If HCC decides to let FLS keep operating the system, it becomes highly profitable for FLS since the firm will have paid off its capital investment. So HCC gets to renegotiate for lower rates on the solar thermal energy and a higher kickback off the solar energy sold to Progress.

What will it cost if HCC wants to take over the system 10 years from now?

No one knows right now. It’s impossible to say what the market value of a solar system like this will be 10 years from now. But FLS won’t be able to ask for whatever it wants. Language in the contract says the equipment will be offered to HCC at fair market value, which presumably would trigger a third-party independent appraisal of the equipment to determine what that is.

Why is HCC exceeding the state energy mandate?

HCC has to meet tough new state energy standards that apply to public buildings, thus requiring a certain level of alternative energy. However, HCC is going above and beyond what it has to in order to meet the state mandate.

But since it isn’t costing HCC anything to do so, why not? asked Michael Nicklas, the lead architect.

“We could improve the efficiency at no additional cost,” Nicklas said.

The building will qualify for a platinum LEED designation, the highest of all green building rankings, which has drawn fire from critics. Nicklas said a platinum rating was not their motive, however, but merely a side effect of designing a good building.

“It is not driven by the platinum rating,” Nicklas said. “If it ends up platinum, it’s because we were able to get a good deal on this solar.”

What is solar thermal?

Fluid, usually a combination of water and antifreeze, flows through coils on the roof of the building. The coils sit on a black surface under a clear glass lid. The black surface absorbs the sun’s heat and traps it under the glass. The heat builds and builds, like the greenhouse effect, and the fluid flowing through the coils heats up as a result.

“It could easily get to boiling temperatures, but more commonly 150 or 160 degrees Fahrenheit,” said Tommy Cleveland, a solar thermal expert at the N.C. Solar Center.

How hot depends on the strength of the sun’s rays and the air temperature.

How does that make hot water?

The coils carrying the hot fluid pass through a hot water tank, transferring the heat to the water.

How does it make heat for the building?

The coils flow under the floor, creating radiant heating similar to a radiator.

How does it make air conditioning?

The heat given off by the fluid in the coils will be captured to power an absorption chiller, a type of air conditioning system that is normally fueled by natural gas.

The fluid flowing through the solar thermal coils needs to be 154 degrees to power an absorption chiller, Freudenberger said. He claims it’s no problem achieving that temperature.

Using the BTUs created by solar thermal energy indeed works in theory.

“It can work and has been done other places but it is not very common,” Cleveland said, citing numerous projects in Germany. “It has been done and it has been made to work. Technically I think it definitely will work. The big question is economically and how well does it work.”

Absorption chillers take more energy and are less efficient than conventional electric air conditioning systems.

Is it a sure thing to make air conditioning using solar thermal?

Absorption chillers powered by natural gas are proven technology. Creating heat in the form of BTUs from solar thermal is also proven. This simply combines the two principles, Shore said.

“Energy is energy. Once you have energy in one form it can be converted,” Shore said.

What if it doesn’t work?

A traditional air conditioning system, as well as traditional hot water and heating systems, are part of the building design as a backup in case the solar thermal system doesn’t work, or for cloudy days and at night.

“No matter what, you have to do a back-up system that can handle the full load of the building,” said Freudenberger.

If it doesn’t work, FLS will be the one in trouble.

“They get paid based on the energy that’s there. If it doesn’t work, they don’t get paid,” said Nicklas. “You aren’t out anything. They are. It is not a matter of you taking any risk on this.”

Are there any costs to HCC?

There will be traditional back-up energy systems in the building, but those are part of the construction costs the college would have to pay for anyway — regardless of what solar components are sitting on the roof.

FLS will pay for the absorption chiller, as well as all the solar equipment, and even the additional wiring for the solar systems.

“Literally right to the junction point of the building,” Freudenberger said.

Does the building itself have to be designed in a special way, causing general construction costs to be higher?

Michael Nicklas, lead architect on the project and president of Innovative Designs out of Raleigh, said all the green features of the building, including things like the rain water collection system that aren’t part of the alternative energy component, added 4 percent to the building cost.

“It’s not as much as you would think,” he said.

Are there any pitfalls?

Cleveland said it’s not clear how efficient solar thermal energy is at powering absorption chillers. If it takes a lot of BTUs, it’s possible the solar thermal won’t be able to keep up and the back-up system will have to make up the difference.

There are two possible back-up systems: one is using natural gas to power the same absorption chiller, and the other is a traditional electrical air conditioning system. It costs more to power an absorption chiller with natural gas than it would to use a conventional air conditioning system.

“If Haywood is responsible for the natural gas costs the risk could fall on them,” Cleveland said.

But for now, the back-up system included in the plans is a conventional electric air conditioning system so that shouldn’t be an issue.

Cleveland has done economic modeling on absorption chillers versus conventional air conditioning to figure out the economic tipping point.

“There are several variables going on,” Cleveland said. “It depends on how much everything cost you up front.”

In HCC’s case, since they aren’t paying the upfront costs of the absorption chiller or the solar thermal system, then they should go for it, Cleveland said.

“It makes it fairly attractive to the community college,” Cleveland said.

What happens if FLS doesn’t make its loan payments?

County Commissioner Kevin Ensley was concerned if FLS didn’t make its payments, the bank may seize the solar equipment or take over the contract, leaving HCC in a bind.

But Shore said thanks to a forbearance agreement, the solar equipment itself is not the collateral for the loan. The equipment would actually revert to HCC if FLS went bankrupt — not to the bank that made the loan.

What are the intangible benefits?

Students will get to learn the ins-and-outs of alternative energy from a real-life example. HCC President Rose Johnson has made sustainability a focus of the college in recent years across every curriculum and in-campus operations.

“What better way to train the needed workers in the solar energy arena than at a community college,” Shore said.

Tapping the power of the sun

Progress Energy customers can now claim a fraction of their power comes from the sun.

A new solar farm is on line in Canton sporting 2,340 solar panels on four acres — generating enough electricity to power 51 homes. A new state law that mandates utilities get 12.5 percent of their power from renewable sources by the year 2021 was the catalyst for the solar farm.

“A project like this really starts with good policy,” said Michael Shore, president of FLS Energy, which installed the solar field.

To help meet the renewable mandate, Progress Energy pledged to buy solar power from FLS at a set rate for the next 20 years.

While the solar field cost FLS $5 million up front to build, a sure-fire revenue stream in the form of a 20-year contract with Progress essentially guarantees a pay off down the line. Nonetheless, financing wasn’t easy, especially during an “economic calamity,” Shore said.

“Banks don’t have experience financing solar farms,” Shore said. “Even though we know we have a secure revenue stream backed up by Progress — what could be more secure? — we still had to get banks comfortable with it.”

Now that the ground has been plowed, Shore hopes subsequent projects will be easier. After 10 years, the debt will be paid off, and solar becomes quite profitable, Shore said.

“The lynchpin is you have to have somebody willing to buy the electricity,” Shore said.

And without the state legislation that forced utilities to invest in renewable energy, it is unclear whether a buyer would step up to the plate.

Sen. Joe Sam Queen, D-Waynesville, said this was exactly what lawmakers had in mind when passing the renewable energy legislation three years ago.

“We wouldn’t have this project if we didn’t have those kinds of incentives. We wouldn’t be creating these jobs and moving toward an authentic alternative energy portfolio,” Queen said.

Progress now has 11 megawatts of solar power feeding its grid from solar farms across the state.

“This is a significant step in our balanced approach to bring clean, reliable and affordable power to the people across North Carolina,” said John Smith, Progress Energy’s vice president for the western region.

While this solar farm is only half a megawatt, add that to another half a dozen that have come on line in the past year, and it starts to add up, Shore said.

“This is just the beginning. When we stared this project two years ago, there were no solar farms in North Carolina. There were no solar farms in the Southeast,” Shore said.


The business of solar

Solar technology has long been considered cost prohibitive. But in the industry, it is finally reaching a critical mass.

As demand for solar grows, the technology gets better and cheaper. The cost of solar panels has come down 50 percent in three years. It’s similar to any electronics, from iPods to flat screen televisions, which come down in price the longer they are on the market, said Queen.

But in the meantime, the state has offered substantial tax incentives to spur solar development.

Apparently it worked, because soon those tax incentives won’t be needed anymore, according to Matt Card, director of business development for Suniva, which manufactures solar panels in Atlanta.

The cost of solar panels will continue to come down, while the cost of electricity continues to rise. Eventually, the industry will reach “grid parity.”

“At that point, it becomes just as cheap to build this as another power plant,” said Card.

As solar grows, so do associated jobs. FLS went from three to 50 employees in five years. The installation of the solar field in Canton provided full-time work for 15 of its staff for half a year.

The maker of the solar panels, an American company based in Atlanta, likewise is on the move. Suniva has gone from two to 150 employees in under three years. It plans to add another 75 manufacturing jobs this year to meet the skyrocketing demand for solar panels, Card said.

“There is a very tangible connection to job creation,” Card said.

It’s an industry where Haywood County is eager to make a name for itself.

“Hopefully it will be the beginning of other renewable energy projects in the future for our county,” said Mark Clasby, Haywood County economic development director.

In response to the solar farm, Haywood County passed an incentive package that gives alternative energy companies up to an 80 percent reduction in property taxes for investments made here.

Maintaining solar fields requires very little maintenance and no fuel costs like other power plants do. The panels just sit there soaking up the sun. They don’t even have to be cleaned, with that job left to the rain.

It’s unknown just how long they could last. They come with a warranty for 25 years, but could last twice as long.

Solar panels do wear out over time, degrading at about a quarter of a percent a year in their output. At the end of 25 years, they could be generating only 80 percent of what they were their first year, Shore said.

A ribbon cutting for the solar field was held this week. U.S. Rep. Heath Shuler, D-Waynesville, commended Progress Energy for getting on board the renewable energy train and the state of North Carolina for its progressive energy policy.

“North Carolina has really taken the first steps in that and is much further along than most states are,” Shuler said.

Shuler said he hoped WNC could become a “national hub for green energy.”

Shore was an environmental lobbyist in Raleigh for years before becoming an entrepreneur and starting his own solar company. For him, seeing the solar field up and running was emotionally moving.

“For years there was always the promise of renewable energy, but there was something standing in the way of making it happen,” Shore said. [Now,] “it’s powering real houses, and there’s a real business case behind it.”

Sun power supplies a path to simplicity

Lydia Aydlett first moved to the mountains of Western North Carolina during the height of the back-to-the-land movement, and it’s taken her all the time since to understand why living a sustainable life is so important to her.

Aydlett grew up in the eastern part of the state, near Elizabeth City, during the 1950s and ‘60s. She moved to the Piedmont region with her husband, a banker, and when the marriage failed, she decided to make a change.

“I was really interested, even then, in finding alternatives to the intense consumption that had been taking place all around me,” said Aydlett.

Aydlett bought a white farmhouse and 25 acres and moved her two young children to the area between Sylva and Cullowhee in 1978.

“We’d been through the ‘60s so there was a lot of ‘f—- the establishment.’ Feminism was a part of that for me and of moving myself to the mountains by myself with my kids,” Aydlett said.

What Aydlett found in the mountains of Western North Carolina was a sense of community.

“This was the back to the land time. Lots of returning Vietnam vets. There were people from around the country who had come to this area to live the homestead life,” Aydlett said.

Aydlett had friends who lived in teepees and broken down barns and there was still music in the air. She remembers chanting and spinning at Sufi dances held at Caney Fork Community Center, where the good ole boys would come to watch them and drink beer.

“It was a bunch of hippies who were thoughtful people and were trying to sort things out,” Aydlett said. “Some of them are still around.”

But while her experience in the early ‘70s gave Aydlett a taste for rural living, she didn’t necessarily get close to the environmental principles she espouses today. For instance, at that time, the thought of killing a chicken for food disgusted her.

“I was working full-time and raising kids and just kind of scrambling to keep life together,” Aydlett said.

Having gotten a master’s degree at Western Carolina University, Aydlett worked with young children with developmental disabilities and raised her family.

It was when she went back to school again at University of North Carolina-Chapel Hill to pursue a doctoral degree in 1984 that Aydlett rediscovered her fervor to live life differently.

She spent her time in Chapel Hill in a co-housing community that espoused sustainable living in close quarters.

“That community boosted my consciousness and let me know that this could be done,” Aydlett said. “And when I say ‘this’ I mean living a sustainable lifestyle. One that’s more self-contained and has a shorter feedback loop.”

When Aydlett came back to teach at Western Carolina, she sold three acres and the white farmhouse and began work on building a sustainable homestead high on the ridge on Robertson Mountain.

Friends of hers from Chapel Hill helped her build a 16-by-16-foot cabin that ran off of solar power, had a composting toilet, and well-water driven by gravity.

Living in the cabin was an intermediate step, and it taught Aydlett a lesson about what she wanted. She didn’t want to live THAT simply.

Now her house runs off solar electricity and has a solar water heater which Aydlett augments with a propane generator and a propane stove. She has a dishwasher, a television, and a pro-audio system.

It’s not about living an austere life, Aydlett said, but about being connected to what you use.

“If I use too much electricity I know it. If a person in a conventional house does, they just have to pay a little bit bigger bill,” Aydlett said.

Aydlett has begun growing her own vegetables in a large terraced garden above her house, which she feeds with rainwater. After collecting water in rain barrels under her downspouts, she pumps it uphill to a holding tank so she can use gravity to water her beds.

Aydlett also maintains a small goat herd, 20 chickens, and one large Great Pyrenees to keep them safe from coyotes and wandering pit bulls.

Last week she killed a rooster for the first time with help from friends, and she’s getting used to the idea of doing it again. As Aydlett has matured, so has the environmental movement. She marvels at the political infrastructure in place now to advocate for sustainable living.

But she has come to believe that it’s the practical day-to-day connections to the earth that are most valuable to her.

“I’m really glad [the movement] is out there, but it’s not the same as being aware that because we’ve had three cloudy days the battery bank has gotten low,” Aydlett said.

Aydlett still works part-time as a counselor of children. She is by no means a hermit on her mountaintop. Her life has taken her on a journey, and now the ideologies that drove her decisions in her youth are taking root in new ways.

“I don’t hold to the ideologies with the same fervor as I did then but they certainly have fed my growth and helped create my path,” said Aydlett. “It’s more of a feeling thing than a thinking thing now.”

Haywood extends token to Canton solar farm

FLS Solar Energy wants a tax break from Haywood County in exchange for an $8 million solar farm the company is building near Canton.

FLS is asking county commissioners for financial incentives that would allow the company to pay 20 percent of the taxes on the equipment it uses to operate for five years, saving FLS $6,400 a year or a total of $32,000.

Through the program, FLS would pay the total equipment tax up front, then receive a grant for 80 percent of the bill from the county.

The company’s request has received the endorsement of the Haywood County Economic Development Commission, though it’s not exactly in line with the intent of creating jobs. The solar farm will only create 12 jobs, most of them during the design, development and installation stages, said FLS president Michael Shore.

However, EDC officials believe the county will reap more benefits from the project than just job creation.

“This is kind of unusual because this really won’t create jobs, but you kind of have to look to the future,” said EDC director Mark Clasby. “This will bring recognition and awareness that Haywood County is interested in green initiatives.”

While the amount may not seem like much, it will make all the difference to FLS, Shore said. FLS will have to pay back money put up by investors — about half the total project cost — within a five-year period, making for very thin profit margins, said Shore. Financial incentives from the county will help the project make it through the lean time.

“This allows us for it to be a profitable project in the first five years,” Shore said. “Starting year six, the margins of the project improve significantly, so we’re happy to pay our fair share of taxes at that point.”

FLS has signed a 25-year contract with Progress Energy to sell solar power generated at the Haywood site, guaranteeing that the company will be shelling out full property taxes for at least a 20-year period.

“Over the lifetime of the project, we anticipate paying at least $180,000 in taxes,” said Shore.

Shore says that by providing tax breaks for FLS, Haywood County could position itself as a good place to locate a green startup.

“In the Southeast, it’s up for grabs where the leadership (in alternative energy) is going to come from,” he said. “Now, Haywood County has the opportunity to put itself on the map as a leader in this new green economy.”

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