AGENDA
MUNICIPAL SERVICES COMMITTEE
MEETING NOTICE
MAY 24, 2022
PUBLIC MEETING 4:00 P.M.
MEMBERS
Andy Wilson, Chair/Vice Mayor, District 7
Tyron Hampton, Councilmember, District 1
Felicia Williams, Councilmember, District 2
Jessica Rivas, Councilmember, District 5
STAFF
Jeffrey Kightlinger, Interim General Manager
Lisa Hosey, Assistant City Attorney
Garrett Stevenson, Recording Secretary
MISSION STATEMENT
The City of Pasadena is dedicated to delivering exemplary municipal services, responsive to our entire community and consistent
with our history, culture and unique character.
In compliance with the Americans with Disabilities Act of 1990, Assistive Listening Devices are available from the City Clerk’s Office with a 24-hour advance notice.
Please call (626) 744-4124 to request use of a listening device.
Language translation services are available for this meeting by calling (626) 744-4124 at least 24 hours in advance.
Habrá servicio de interpretación disponible para éstas juntas llamando al (626) 74
4-4124 por lo menos con 24 horas de anticipación.
Items on the agenda may not be called in order listed.
Agendas and supporting documents are available on the Internet at http://ww5.cityofpasadena.net/commissions/city-council-municipal-services-committee/ Materials related to an item on this Agenda submitted to the Municipal Services Committee after distribution of the agenda packet will be posted online and listed as: “Supplemental Agenda Material Received after the Posting of the agenda”.
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g
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orrespondence will be forwarded to the legislative body prior to the start of the meeting.
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IF
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OR [email protected].
CITY OF PASADENA
MEETING OF
THE MUNICIPAL SERVICES COMMITTEE
MAY 24, 2022
PUBLIC MEETING: 4:00 PM
PASADENA CITY HALL, COUNCIL CHAMBER
100 NORTH GARFIELD AVENUE, ROOM S249
N
ote to the Public: City Hall is closed to the public until further notice.
N
OTICE IS HEREBY GIVEN that the regular meeting of the Municipal Services Committee will be held by videoconference/teleconference on Tuesday, May 24, 2022 at 4:00 p.m., to discuss matters on the attached agenda.
A
ndy Wilson, Chair
Municipal Services Committee
I HEREBY CERTIFY that this agenda in its entirety, was posted on the Internet at https://www.cityofpasadena.net/commissions/city-council-municipal-services-committee/ and on the Council Chamber Bulletin Board, Room S249, and the Bulletin Board in the rotunda area; City Hall, 100 North Garfield Avenue, this May 19, 2022 by 6:00 p.m. and that copies hereof were faxed, emailed or delivered to each member of the City Council and to each local newspaper of general circulation, radio or television station requesting notice in writing, all of which recipients are identified on the distribution herein below.
Susana Castro
DISTRIBUTION:
MSC Committee Members Central Library General Manager Pasadena Weekly City Council City Clerk Director of Planning and Permitting Pasadena Star-News City Manager Director of Public Works Los Angeles Times Pasadena Now City Attorney Public Information Officer La Opinion Pasadena Journal In compliance with the Americans with Disabilities Act of 1990, listening assistive devices are available from the City Clerk's Office with a 24-hour advance notice.
Please call (626) 744-4124 to request use of a listening device. Language translation services may be requested with 24-hour advance notice.
Habra servicio de interpretacion disponible para estas juntas llamando al (626) 744-4124 por lo menos con 24 horas de anticipación.
MEETING AGENDA
MUNICIPAL SERVICES COMMITTEE
MAY 24, 2022
Public Meeting: 4:00 P.M.
Council Chamber, Pasadena
City Hall 100 North Garfield Avenue, Room S249
APPROVAL OF MINUTES
1. BUDG
ET WORKSHOP – FY 2023 RECOMMENDED OPERATING BUDGET
a. PUBLIC WORKS DEPARTMENT
b. FY 2023 ENHANCEMENT REQUESTS
2. R
OOFTOP SOLAR PAYBACK AND COST ANALYSES
PUBLIC MEETING - 4:00 P.M.
ROLL CALL
PUBLIC COMMENT
INFORMATION ONLY
ADJOURN
NEW BUSINESS
1 ITEM #1a
2 Department Public Works
FY 2023 Recommended
Operating Budget
May 24, 2022
3 Department of Public Works
FY 2022 Accomplishments
• Provided key staff and resources to hold a successful Rose Parade and Rose Bowl game after the Covid-19 pandemic
• Initiated revision to City’s sidewalk fees and development of new on-street dining fees
• Implemented year two of the Three-Year Fleet Replacement Plan • Completed capital projects totaling over $22 million
• Managed active grants totaling over $18.7 million
• Implemented organic waste recycling program
• Citizen Service Center continued providing uninterrupted call center services citywide
2 4
Department of Public Works
Appropriations by Category – All Funds
3 Category
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Actuals
FY 2022
Adopted
FY 2023
Recommended
%
Change
Personnel 32,465,160 35,962,835 27,915,360 36,133,600 38,091,290 5.4% Services & Supplies 18,776,058 20,726,815 19,128,615 22,743,251 25,849,244 13.7% Internal Srvc Chrg 9,039,125 10,257,249 10,058,113 8,867,582 9,852,175 11.1% Operating Expense 7,833,360 8,362,390 8,237,665 0 0 -
Capital Outlay 1,616,355 3,536,222 1,896,373 9,146,652 6,889,465 -24.7% Debt Service 8,690 9,504 4,488 9,504 9,504 0.0%
Non-Op Expense 3,233 (6,109) 0 0 0 -
Operat Transfer Out 618,000 300,000 0 0 0 -
Grand Total 70,359,981 79,148,906 67,240,614 76,900,589 80,691,678 4.9% FTE 267.48 267.63 0.15
5 Department of Public Works
Appropriations by Fund – All Funds
4 Fund
FY 2019
Actuals
FY 2020
Actuals
FY 2021
Actuals
FY 2022
Adopted
FY 2023
Recommended
%
Change
General Fund (101) 21,282,557 22,303,354 12,846,509 13,539,119 16,001,258 18.2% General Fund Projects Fund (105) 424,079 545,489 157,768 305,500 301,500 -1.3% New Years Day Genl Fund Events (106) 400,542 398,394 0 300,363 300,363 0.0% Sewer Construction and Maint. (205) 1,992,200 2,072,372 2,412,346 2,634,746 3,500,142 32.8% Gas Tax Fund (210) 1,833,379 1,929,552 1,675,736 2,338,741 3,399,786 45.4% Project Management Fund (301) 0 0 0 7,982,634 7,209,610 -9.7% Refuse Collection Fund (406) 15,236,086 19,250,538 19,091,524 20,320,484 19,843,283 -2.3% Building Maintenance Fund (502) 11,176,839 12,622,989 12,922,590 13,189,334 14,241,298 8.0% Fleet Replacement Fund (503) 2,807,049 3,507,569 2,748,273 6,672,384 5,462,207 -18.1% Citizen Service Center Fund (510) 789,569 921,697 763,956 868,392 867,010 -0.2% Fleet Repair and Maintenance (511) 8,611,441 9,289,538 8,298,409 8,748,892 9,565,221 9.3% General Fixed Assets Acct Group (701) 5,806,240 6,307,414 6,323,503 0 0 - Grand Total 70,359,981 79,148,906 67,240,614 76,900,589 80,691,678 4.9% 6 Department of Public Works
Revenue Outlook
• Projecting $67.7 million in revenue for FY 23
• Revenue used both operations and capital
improvement projects
• Short term / long term revenue strategies
5 7
Department of Public Works
Significant Changes from FY 2022 Budget
• General Fund
> Tree replacement and
planting program
($250K / one-time)
> Traffic intersection
improvements
($250K / one-time)
> Grant writing support
($75K / one-time)
6 8
Department of Public Works
Significant Changes from FY 2022 Budget
• Refuse Collection Fund
> Purchase 4 refuse vehicles per Refuse Collection Fund Replacement Schedule ($1.71M / one-time)
> Recycling and organic waste processing increase
($470K / on-going)
7 9
Department of Public Works
Significant Changes from FY 2022 Budget
8 • Building Maintenance
Fund
> Implement two-year
building maintenance
rate increase plan
> Continue
implementation of
Annual Work Plan using
Building Maintenance
Fund balance in FY 23
10 Department of Public Works
FY 2023 Priorities
• SB 1383 organics recycling
education and outreach
• Continue year three of the
Three-Year Fleet
Replacement Plan
• Conduct rate studies for
Refuse Collection Fund and
Sewer Construction and
Maintenance Fund for FY
2024
9 11
Department of Public Works
FY 2023 Priorities
• Grant funding opportunities
• Maintenance strategies
> Implement comprehensive
sidewalk improvement strategy
> Implement enhancements for
windstorm clean-up strategy
10 12
Department of Public Works
FY 23 Public Works Operating Budget
Questions?
11 13
ITEM #1b
14 FY 2023
ENHANCEMENT REQUESTS
Status
(For Budget Use) Department Fund Cost Category Classification FTE Amount Justification One-Time / Ongoing Yes - C&D Public Works 101 Services & Supplies 75,000 Contract services to apply for grant opportunities. One-Time Yes - C&D Public Works 101 Services & Supplies 250,000 Tree replacement and planting program - plant 200 trees annually; previously grant-funded (State Environmental Enhancement & Mitigation).
One-Time
Yes - C&D Public Works 406 Capital Outlay 250,000 Traffic Safety Improvements One-Time Yes Public Works 406 Services & Supplies 70,000 Increasing costs for recycling processing (residential $56k, commercial $14k). Ongoing Yes Public Works 406 Services & Supplies 400,000 Increasing costs for organic waste processing (residential $320k, commercial $80k). Ongoing Yes Public Works 406 Capital Outlay 1,714,010 Scheduled replacement of four refuse vehicles (3199, 3193, 3194, 3195); vehicles w/ highest maintenance costs. One-Time Yes City Attorney 101 Personnel Prosecution Assistant 1.00 80,693 To provide additional support for Prosecution Division; significant increase in case filings and criminal case referrals. Ongoing Yes City Attorney 507 Personnel Insurance & Claims Specialist 1.00 86,814 To assist the Liability & Claims Diviision whose workload has substantially grown; currently 2 staff. Ongoing Yes City Attorney 101 Services & Supplies 200,000 Additional outside legal services for overall department. Ongoing Yes City Attorney 101 Services & Supplies 25,000 Additional funds for various services and supplies costs including State Bar and other associaiton dues, library reference materials and other resource subscriptions.
Ongoing
Absorb City Manager 101 Personnel Administrative Specialist 1.00 86,828 To assist the City's Real Property Manager who manages over 400 City owned properties; support the Acting Economic Development Manager and serve as primary backup for the department's Management Analyst I.
Ongoing
Absorb City Manager 101 Personnel 22,000 To fund existing Administrative Intern (0.5 FTE) in Public Affairs Division; position added without $$ in Q1 FY22. Ongoing Yes City Manager 101 Services & Supplies 75,000 Consultant services for Community Violence Intervention services Ongoing Absorb Finance 101 Personnel Accountant 1.00 105,261 To assist with bank reconciliation of cash accounts due to the significant increase in electronic payments; to meet critical timelines.
Ongoing
Yes Finance 101 Personnel Payroll Specialist 86,814 To fund existing Payroll Specialist (1.0 FTE). Position was previously approved in FY22, however, funding was not provided. Ongoing Yes Finance 101 Services & Supplies 30,000 Software to comply with GASB 87 lease accounting requirements. Ongoing Yes Finance 101 Services & Supplies 20,000 Procure Now software to assist departments with preparation and tracking of requests for proposals and bid documents. Ongoing Absorb Finance 101 Services & Supplies 23,000 Increase existing LCP Tracker software amount to include monitoring and tracking of local hiring associated with Huntington Hospital project.
Ongoing
Yes Fire 101 Personnel Six (6) CSW-Paramedic Interns
(each @ 0.5 FTE)
3.00 119,244 To implement Paramedic Internship program, as part of PFD Local Area Recruitment initiatives; Individuals will be enrolled in an approved California paramedic training program and required to complete a field internship to become eligible for a California paramedic license; Interns will be highly eligible for upcoming PFD Academies; Recruitment process for Interns will include a local Pasadena preference; Eligibility / Target Age Range: 18 – 25 years.
Ongoing
Yes Fire 101 Personnel 64,077 Overtime costs to continue running existing Local Area Recruitment Programs and implement new programs: Exploreres Program ($19,024), Girls Camp ($9,806), and Pasadena Unified School District Program ($35,247).
Ongoing
Not Yet Fire 101 Interal Service Charges 583,579 Two (2) remounted rescue ambulances to serve as the Department's 6th front-line RA and 6th reserve RA; Remounted vehicles result in an approximate 15% savings compared to new vehicles.
This request to be revisted after the new revenue mechanism is evaluated, approved and operational to fund the cost.
One-Time
Not Yet Fire 101 Services & Supplies 54,000 Six sets of turnouts and personal protective equipment for six additional Firefighter Paramedics.
This request to be revisted after the new revenue mechanism is evaluated, approved and operational to fund the cost.
One-Time
Not Yet Fire 101 Services & Supplies 72,000 Six radios for six new Firefighter Paramedics.
This request to be revisted after the new revenue mechanism is evaluated, approved and operational to fund the cost.
One-Time
Absorb Fire 101 Services & Supplies 89,472 Additional hours (from 80 to 160 per month) for contracted Nurse Educator and Continuous Quality Improvement (CQI) Program Coordinator to provide Paramedic Continuing Education and CQI program implementation; increase maximum service hours under current contract.
Ongoing
Yes Fire 101 Services & Supplies 21,900 Paramedic School tuition for six (6) PFD Paramedic Internships. Ongoing Yes Housing 238 Services & Supplies 150,000 To support various needs at dept's discretion (i.e. encampment clean up, Section 8 document scanning, HOPE Case Manager. One-Time Yes - ARPA Housing 238 Services & Supplies 3,000,000 CM's direction to designate $3 million of ARPA 2nd tranche funding for Housing project. One-Time Yes Human Resources 101 Personnel HR Specialist 1.00 84,563 This position is critical for recruitment, testing, pre-employment, on boarding and employment services so that HR can continue to help departments fill critical vacancies and deliver service to the public. The City is experiencing a sharp increase in employee turnover, both resignations and retirements. The recruitment team needs position reinstated from FY21 (eliminated to help balance budget).
Ongoing
Absorb Human Resources 101 Personnel Senior Office Assistant 1.00 80,693 This position is responsible for office reception and pre-employment processing, among other administrative tasks. This was formerly a Human Resources Specialist, but the department seeks to replace it with a lower level position that more appropriately describes the work needed. Position was eliminated in FY21 to help balance budget.
Ongoing
15 FY 2023
ENHANCEMENT REQUESTS
Status
(For Budget Use) Department Fund Cost Category Classification FTE Amount Justification One-Time / Ongoing No Human Resources 101 Personnel HR Analyst (limited term) 1.00 116,441 IF HR continues same capacity of COVID work, position needed for employee contact tracing and testing/vaccine policy compliance.
Will revisit if COVID cases surge and additional resources are required.
One-Time
No Human Resources 101 Services & Supplies 60,000 IF testing requirement remains, additional budget for weekly COVID testing ($60,000 per month).
Will revisit if COVID cases surge and additional resources are required.
Ongoing
Absorb Human Resources 101 Services & Supplies 75,000 Consultant services for DEI work; previously absorbed in line item for training. Ongoing Yes Planning & Comm Development 204 Personnel Administrative Specialist 1.00 86,828 To provide administrative support for the new Building Official. - FTE being transferred from Finance Ongoing Yes - ARPA Planning & Comm Development 101 Services & Supplies 500,000 Consultant services for citywide Historic Resources survey (over 2 years). One-Time Yes Police 101 Personnel Park Safety Specialist 2.00 186,896 To enhance security at City parks (Robinson Park, Jackie Robinson Center & La Pintoresca) by offering patrol visibility and developing relationships in the neighborhoods; part of City's Violence Prevention Initiative.
Ongoing
Absorb Police 101 Services & Supplies 340,000 Contract for body worn cameras.
Additional funds previously added approved hardware already included in base.
Ongoing
Absorb Police 101 Services & Supplies 144,000 Data charges for new RIPA Cell phones purchased for the department. Ongoing Absorb Police 101 Services & Supplies 75,000 New Critical Performance Unit - to be used for personnel training and the development of curriculum based in technology and behavioral psychology to help employees with enhanced decision making as it relates to de-escalation and use of force.
Ongoing
Absorb Police 101 Services & Supplies 75,000 New Wellness Unit - to assist employees in both personal and professional lives experiencing crisis/trauma from the demands of sustained performance in stressful, dangerous and rapidly evolving envirnoments. The Wellness unit will provide resources to ensure professional and personal stability.
Ongoing
Yes PRCS 101 Personnel CSW-MASH Cross Training 1.00 31,584 To assist with ground maintenance responsibilities at new park in Playhouse District (i.e. opening the park each morning, picking up trash and emptying trash cans, and removing weeds and dead plants.
Ongoing
Yes PRCS 101 Personnel CSW-MASH Cross Training 1.00 31,584 To assist with landscape maintenance responsibilities (i.e. trimming, edging, pruning shrubs, plants and any ground cover) for the Annandale Trail project; to also assist with ground maintenance at Desiderio Park.
Ongoing
Yes PRCS 101 Capital Outlay 31,900 Purchase of two mowers and a gator; originally salvaged in 2012 (not part of replacement program). One-Time Yes PRCS 101 Services & Supplies 45,000 Additional budget for Amerifest (in addition to original base $80k). Ongoing Yes PRCS 101 Services & Supplies 30,000 Scholarship program for community-based youth sports. Ongoing No Public Health 101 Services & Supplies 292,000 GF support for Cross Connections program; need to correct the inventory of devices for future billings. Ongoing (up to 5 years) Yes Public Health 101 Operating Transfer 224,000 GF support for PORT 1; previously funded by SAMHSA grant ending Sept. 2022. Ongoing Yes Transportation 101 Services & Supplies 250,000 To partially restore and true-up budget for contract parking enforcement officers and related expenses for increased use of the parking permit/citation software; revenue offsets from increased parking permits and parking citations.
Ongoing
Yes Transportation 209 Interal Service Charges 235,000 Increased CNG costs for fixed route service; Fund 208/209 dedicated funding source. Ongoing Yes Transportation 208 Interal Service Charges 40,000 Increased fuel costs for vehicles used for Dial A Ride service. Ongoing Yes Transportation 106 Services & Supplies 75,000 Removal and re-installation of outdoor dining locations along Colorado Blvd for the Rose Parade; this portion represents TOR's share and can be requested with the City's tally of TOR billables; cost was $75k in 2022.
Ongoing
Yes Transportation 101 Services & Supplies 30,000 Removal and new installations of outdoor dining locations NOT associated with the Rose Parade; partial cost recovery from on- street dining fee.
Ongoing
Yes - ARPA Transportation 101 Services & Supplies 250,000 Sustained year-long education and awareness campaign to increase road safety. One-Time Yes Transportation 209 Services & Supplies 300,000 Consultant services to develop a Short Range Transit Plan plan to maximize ridership and evaluate future service options with detailed cost breakdowns; SRTP required by Metro every 3-5 years to receive local return funds.
One-Time
Yes Water & Power 401 Personnel 40,849 Reclassify existing Business Systems Analyst to Information Technology Manager; 0.65 FTE Fd 401. Ongoing Yes Water & Power 402 Personnel 21,996 Reclassify existing Business Systems Analyst to Information Technology Manager; 0.35 FTE Fd 402. Ongoing Yes Water & Power 412 Capital Outlay 30,000 GCMS Purge and Trap Concentrator One-Time Yes Water & Power 412 Capital Outlay 20,000 UV-Vis Spectrophotometer One-Time Yes Water & Power 401 Services & Supplies 75,000 To develop and promote EVs in disadvantaged communities and low-income areas through educational and outreach programs; in partnership with The Art Center, PCC, and vendors.
One-Time
Yes Water & Power 411/412 Capital Outlay 1,712,188 To purchase a variety of 11 scheduled vehicle replacements and a new forklift. One-Time TOTAL FTE 15.00 $ 13,345,214 TOTAL Enhancement Requests
16 ITEM #2
17 PASADENA WATER AND POWER
MEMORANDUM
May 24, 2022
To: Municipal Services Committee
From: Jeffery Kightlinger
Interim General Manager
Subject: Information Item – Rooftop Solar Payback and Cost Analyses
EXECUTIVE SUMMARY:
During the January 25, 2022, Municipal Services Committee meeting presentation regarding the Pasadena Water and Power (“PWP”) 2021 Power Integrated Resource Plan (“IRP”) Update, a request was made for PWP staff to analyze two questions regarding local solar options:
1. What is the current expected payback period for a residential customer who installs rooftop solar in Pasadena?
2. What are the estimated costs per kW and kWh of residential, commercial, community and utility-scale solar?
In an effort to provide an analysis of the local solar options to answer both of these questions, staff performed analyses using different Economic Accounting Perspectives (“EAP”). An EAP identifies the entity that pays for and receives benefits from an investment. The analysis uses assumptions to estimate the expected payback period for a residential customer who installs rooftop solar and to compare the estimated costs per kW and kWh of residential, commercial, community and utility-scale solar.
To determine the expected payback period for a residential customer who installs rooftop solar in Pasadena, the individual residential customer EAP is used, which ignores other technologies, other customers, the utility and City as a whole, and the environment. The individual residential customer EAP assumes that each customer separately pays for the rooftop solar, not the utility, and that the customer receives the benefit of avoided energy payments to PWP. This EAP analysis applies to all customers individually.
To determine the estimated costs per kW and kWh of residential, commercial, community and utility-scale solar, this analysis requires a utility EAP. A utility EAP helps ensure equivalent comparisons of costs across different sizes and locations of solar investment, assuming that PWP would commit to make payments for local and remote solar of different scales. For example, the utility EAP does not assume a structure in which PWP would invest in a 5 kW community solar project and only those customers 18 Rooftop Solar Payback and Cost Analyses
May 24, 2022
that purchase shares in the project would pay for the project costs. Rather, the utility EAP assumes that PWP invests in a solar project and charges all of PWP customers for project costs. The utility EAP assumes that if PWP signs a contract for utility-scale remote solar, all customers would pay rates that recover those costs.
Key Results of the Solar Cost Analysis include:
• The estimated payback for a residential rooftop solar is 7.5 – 8 years for two installations, 5 kW and 10 kW, using current avoidable energy charges. • I n 2022, measured at the point of generation, residential solar is approximately five times as expensive (in $/kWh) of energy produced than utility-scale solar. A 25,000 kW residential rooftop project would add about $8.5 million/year to the power revenue requirement, compared with about $3 million/year for the same size utility-scale project.
The utility-scale project could also produce about 70 percent more energy.
BACKGROUND A ND KEY FINDINGS:
First, to estimate the expected payback period, or return on investment, for a typical residential customer in Pasadena who installs rooftop solar, data from various sources were used to identify typical installations, including the number of solar panels, square footage of panels, total installed DC capacity in kW, inverter efficiency (DC => AC), and annual solar energy production (kWh). Additionally, further assumptions were required, such as the use of industry-standard sources for installed cost and the use of the current federal tax credit to reduce the net installed capacity cost, in dollars per kW.
Also, the avoided cost of energy purchased from PWP at current rates was used to estimate the annual pay-back associated with rooftop solar and develop the number of years for the investment to break even. A further assumption is that future PWP rates are the same as today, which will most likely not be the case in order to avoid cost shifting in the future.
The calculations for the estimated payback for a residential rooftop solar is demonstrated below in Table 1 and Table 2:
19 Rooftop Solar Payback and Cost Analyses
May 24, 2022
Table 1
Table 2
Second, to estimate the costs per kW and kWh of residential, commercial, community and utility-scale solar, the analysis used the installed overnight capital cost ($/kW) and other assumptions to estimate the annual cost of energy ($/kWh) at the time of installation not considering panel degradation, and the total annual cost ($/year) to PWP assuming a total installation of 25 MW (25,000 kW). The total increment of new solar capacity for all scales uses a metric from the 2021 IRP Update, which added utility- scale solar in 25 MW blocks. The total annual costs of the 25 MW blocks are compared to the current PWP annual revenue requirement for power.
The calculations for the estimated costs per kW and kWh of residential, commercial, community and utility-scale solar are shown in Table 3 and Table 4:
Smaller House Larger House
Installed capacity (kW, DC) 5 10
Installed cost ($/W) 2.44$ 2.44$
Installed cost ($/kW) 2,438$ 2,438$
Overnight capital cost 12,190$ 24,380$
Local incentives N/A N/A
State incentives N/A N/A
Federal incentives (ITC) 26% 26%
Net installed cost 9,021$ 18,041$
Inverter efficiency 85% 85%
Effective AC capacity (kW) 4.25 8.50
Capacity factor 0.19 0.19
Annual energy production 6,925 13,850
Payback inputs
Monthly energy production (kWh) 577 1,154 Avoided cost: first 350 kWh/mo. 43.22$ 43.22$ Avoided cost: next 400 kWh/mo. 57.07$ 100.53$ Avoided cost: above 400 kWh/mo -$ 43.27$ Annual avoided energy cost 1,203$ 2,244$
Payback period (years) 7.5 8.0
Payback period (at winter rates)
20 Rooftop Solar Payback and Cost Analyses
May 24, 2022
Table 3
Table 4
These analyses use the National Renewable Energy Laboratory (NREL) Annual Technology Baseline published in July 2021 (ATB). Other sources were considered, which yielded results that support the results included in this analysis. For example, a May 2021 report by GDS Associates to the California Municipal Utilities Association (CMUA) uses estimated cost data gathered from three sources to create a single estimated cost of installation in $/kW: NREL’s “U.S. Solar Photovoltaic System Cost Benchmark” (November 2018 but reporting data as of early 2018), Energy Sage and the California Public Utilities Commission (CPUC) (both reporting data as of late 2020). In the 2021 IRP Update, ACES combined data from NREL’s 2020 Annual Technology Baseline and a proprietary source. For this report, the inputs for community solar are set at the level of commercial solar, except that the life of debt is set at the municipal level.
For each of these analyses, the major inputs are the installed cost of photovoltaic solar in $/kW, net of federal tax credits; the fixed operations and maintenance (FOM) cost in $/kW-year; the interest rate assuming that the installation is financed with debt; the repayment period for the debt; and the capacity factor (about 20% for rooftop solar in Pasadena, which measures the amount of energy that a solar panel can produce over time: one kW of solar panels produces about 1,750 kWh during a year). Other assumptions include an 85% DC-AC inverter efficiency, a 1:1 ratio for DC and AC capacity, and the current residential solar tax credit. Results are the total required initial investment, the total annual fixed cost to be recovered from retail rates, the cost of energy per kWh, and the ratio of the annual fixed cost to the current annual revenue requirement for power.
Cost Metrics ($2022) Residential Commercial Community Utility-Scale Installed capacity cost ($/W, DC) 2.44$ 1.58$ 1.58$ 1.25$ Installed capacity cost ($/kW, DC) 2,438$ 1,577$ 1,577$ 1,247$ Total investment up-front for 25 MW 60,950,000$ 39,425,000$ 39,425,000$ 31,175,000$ Annual fixed O&M cost (FOM, $2022/kW) 26.00$ 17.00$ 17.00$ 22.00$ Interest rate for debt 5.00% 5.00% 5.00% 5.00%
Period of debt service (years) 10.00 10.00 20.00 20.00
Annual total fixed cost ($/kW, AC) 8,543,304$ 5,530,718$ 3,588,564$ 3,051,563$ Capacity factor 0.19 0.19 0.19 0.32
Annual project total energy (kWh, AC) 34,623,900$ 35,740,800$ 35,740,800$ 59,568,000$ Annualized unit cost of energy ($/kWh) 0.25$ 0.15$ 0.10$ 0.05$ Residential Commercial Community Utility-Scale
4.30% 2.80% 1.80% 1.50%
2022 PWP Power Revenue Requirement = $197.5 million
Ratio of Annual Total Fixed Costs to Current Revenue Requirement 21 Rooftop Solar Payback and Cost Analyses
May 24, 2022
The estimated payback periods are overstated to the extent that summer solar production is higher than winter production and summer retail rates are higher than winter rates. However, other factors would affect the payback periods as well, including the in-service date for the applicable Investment Tax Credit and future avoided energy charges.
Distributed local solar may cause new costs and avoid/defer otherwise expected costs.
Some of the new/avoided/deferred costs may be reasonably attributable to customers who install solar, but some may be assigned to all retail customers using standard cost allocation procedures. The results here ignore these other local costs (for both the payback and relative cost analyses).
All inputs and assumptions used here are subject to change over time. NREL uses several types of scenarios to estimate and illustrate the uncertainty of projected costs and performance. When specific decisions are required, PWP should update these calculations with then-current information, which will depend on the technologies, vendors, contracts, and end-users involved, among other things.
The payback analysis assumes that PWP does not change its rate design. Changes are being considered to better align fixed costs (e.g., interest on debt) with more-or-less fixed charges ($/kW-month or $/month), and variable costs (prices of energy and fuel in the spot market) with variable charges ($/kWh). Such changes would reduce avoidable costs and thus extend the payback period.
Outcomes of the Solar Cost Analysis
While the estimated payback for residential rooftop solar in Pasadena is 7.5 – 8 years, due to economies of scale, utility-scale solar projects are significantly cheaper than residential or commercial rooftop solar. Individual rooftop solar allows customers to be self-sufficient and reduces the need to build additional utility-scale solar, but has led to questions regarding the total cost of renewable energy and concerns about the impacts on other customers who do not install rooftop solar.
The growth in rooftop solar has been cited as a factor in rising electricity costs for customers without rooftop solar. This is due to rooftop solar customers using less utility- generated electricity and avoiding the full retail rate, which is reducing their share of the cost of grid maintenance and other fixed costs, shifting those costs to the non-solar customers. This has caused a debate regarding the equity implications of rooftop solar installations for other customers, including how much those customers should pay to maintain the grid and cover fixed costs.
Additionally, the large difference in costs between utility-scale and residential rooftop solar is attributed to economies of scale when building solar capacity and more efficient solar production per square meter at larger scales. The solar output of utility-scale solar results in a higher capacity factor than for rooftop solar (more energy per year per square meter). In addition, utility-scale solar allows for everyone to access solar power, 22 Rooftop Solar Payback and Cost Analyses
May 24, 2022
which from the standpoint of cost and equity may be an important consideration. As electric grid modernization continues, distributed rooftop solar and centralized utility- scale solar will both continue to play a role in meeting renewable energy goals, but new costs and avoided costs will have to be shared to create an equitable future.
FISCAL IMPACT:
There is no fiscal impact associated with this report.
23 Pasadena Water and Power
Rooftop Solar Payback and Cost
Analyses
Municipal Services Committee
May 24, 2022
24 Pasadena Water and Power
Cost of Solar Power Analyses
• Municipal Services Committee request for PWP staff
to analyze two questions regarding local solar
options:
> What is the current expected payback period for a
residential customer who installs rooftop solar in
Pasadena?
> What are the estimated costs per kW and kWh of
residential, commercial, community and utility-scale solar? • PWP staff performed an analysis using public data to
answer these, and related, questions.
2 25
Pasadena Water and Power
Individual Residential Customer
• The estimated payback for a residential rooftop solar is 7.5 – 8 years for two scale installations, 5 kW and 10 kW, using avoidable energy charges.
3 Smaller House - 5 kW Larger House - 10 kW
Monthly energy production (kWh) 577 1,154
Savings: first 350 kWh/mo. 43.22$ 43.22$
Savings: next 400 kWh/mo. 57.07$ 100.53$
Savings: above 750 kWh/mo. -$ 43.27$
Annual Energy Savings 1,203$ 2,244$
Payback period (years) 7.5 8.0
Payback period (at winter rates)
• Residential savings are comparable regardless of installed capacity.
26 Pasadena Water and Power
Utility-Scale
• Residential solar energy is approximately five times as expensive (in$/MWh) as utility-scale solar
> Residential $247/MWh
> Commercial $155/MWh
> Community Solar $100/MWh
> Utility-Scale $51/MWh
4 27
Pasadena Water and Power
Outcomes of Solar Cost Analysis – Utility
• Large difference in costs between utility-scale and residential rooftop solar is attributed to economies of scale and more efficient solar electric output (kWh/square meter).
5 > Utility-scale solar:
Has a higher capacity factor than
rooftop solar
Placed in locations with highest
available insolation levels
Has single axis tracking
Utility-scale solar allows for
everyone to have access to solar
power, which from the standpoint of
cost and equity may be an
important consideration
The utility-scale project could also
produce about 70 percent more
energy (single axis tracking)
28 Pasadena Water and Power
Outcomes of Solar Cost Analysis – Residential
> Reduce their environmental
impacts and combat local
climate change
> Create energy independence
> Contribute towards a local
“green economy”
> Lower electric bills for
individuals that own rooftop
solar
6 • Residential rooftop solar has many societal benefits 29 Pasadena Water and Power
Rate Discussion
7 • Residential Rooftop Solar Customers
> Avoided costs are allocated
as retail rates and do not
capture utility infrastructure
fixed costs
> In an ideal rate design, fixed
rates would capture actual
fixed costs, and variable costs
would be a smaller
percentage of the customer
bills
30 Pasadena Water and Power
8 Questions/Comments
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