When it comes to renewable energy, Cleveland has had to scrap for opportunities. Last year, the city used the bully pulpit of its “2019” sustainability project and the release of its Climate Action Plan—which calls for an 80% reduction in its carbon emissions from electricity by 2050—when writing an RFP for its municipal aggregation program. The city picked FirstEnergy Solutions which offers 60,000 Cleveland residents either a 24% below market rate for conventional power or a 21% discount for power produced from wind and hydro sources.
Now, the city’s Office of Sustainability and a well-placed resident who happens to be head of global sustainability at Cisco have attracted a national public-private partnership offering discounts on the purchase of solar panels. Cleveland announced last week that it is the first city to offer homeowners a turnkey solution.
“They selected Cleveland for our SC 2019 initiative,” confirms Cleveland Chief of Sustainability, Jenita McGowan. “Any reduction of electricity helps us meet our goals in climate.”
Solarize Cleveland plugs into a solar bulk purchase agreement between World Wildlife Fund and corporations 3M, Kimberly-Clark and Cisco. They hired the firm Geostellar to manage the program starting with their 143,000 employees. With a pedigree in loan trading and gaming, Geostellar developed an online tool that quickly measures a home’s solar power potential. Also on the free side of the equation, the firm will line up finance options and a local installer.
Reached by phone at his West Virginia home, Geostellar Chief Executive Officer David Levine said that Cleveland is an important test of solar’s market potential because of Ohio’s recent reversal on renewable energy incentives.
“Could we compensate for a lack of solar renewable energy credits and other incentives and try to restart the market?” Levine said. “It was a big part of our thinking. We’ll see if we can do it.”
It may help that Northeast Ohio has relatively expensive electricity rates of eight cents a killowatt hour, he added. Geostellar will come in around six or seven cents a kilowatt hour for solar power.
“The first person who went solar is going to save about fourteen percent on their electricity bills,” he says, adding that a $120 monthly electric bill made it “a good deal.”
(On the other end of the spectrum, I test our home on a woodsy street in Cleveland Heights with our $30/month electric bill, and Geostellar estimates that I would pay $53 a month for 2.95 kilowatts of solar power. With the Cleveland discount, I wouldn’t break even for 20 years.)
A typical Cleveland home can expect a 9-10 year payback if purchasing with cash, Levine says, or a 12-year return on investment if you choose their 2.99% 12-year loan.
“And you get free energy for another 18 years once that loan is paid off,” Levine adds.
Levine credits Ali Ahmed, head of global sustainability at Cisco, a Cleveland resident, and a steering committee member for the city’s Climate Action Plan, for approaching McGowan with the offer.
Reached via Twitter, Ahmed confirms: “Was working on the program for my company, Cisco, and it made sense to bring to CLE based on city's activities.”
Ahmed also Tweeted that he walked the talk by purchasing 17 panels for 5 kilowatt hours of solar power for his Cleveland home.
Levine pitches this as getting a good deal on the ground floor of solar.
“Deutsche Bank reported by 2018 grid parity is going to be achieved,” he said (meaning installing solar can save money on utility bills). “We’re looking at Cleveland as a test bed. The main thing is to just move in the right direction because incentives are going to go away in the next few years. Let’s mobilize local solar champions in recruiting for this and overcome the lack of government incentives.”