The City of St. Petersburg could generate $4.7 million in revenue over 30 years through a new Duke Energy Florida program to expand solar power in the state.
That equals the annual electricity use of almost 140,000 homes, Sharon Wright, the city’s sustainability manager, told a City Council committee on Thursday.
The city signed on as an early adopter for the Duke Clean Energy Connection (CEC) program. Duke Energy Florida, a St. Petersburg-based subsidiary of Duke Energy (NYSE: DUK), unveiled the program in July. If approved by Florida regulators, Duke will offer subscriptions to pay for the development of utility-owned solar plants, as an alternative to customer-owned renewable energy systems.
About two-thirds of the initial subscriptions were set aside for large industrial and commercial users. The rest of the initial subscriptions are split between local governments (10 percent), residential and small business customers (22.5 percent) and low-income customers (2.5 percent).
Customers will subscribe to blocks of solar generation equivalent to 1 kilowatt (kW) of solar power per block and get bill credits in return. In the first few years of enrollment in the program, customers’ subscription fees are expected to outweigh the bill credits, but the fees and credits would balance each other out after four or five years, and after about seven years the credits would exceed the fees, according to Duke.
St. Petersburg was the first city in Florida to commit to 100 percent clean energy, and has undertaken several programs on its own that show clean energy is compatible with job creation and a more sustainable, resilient city, Wright said. The Duke CEC program is another step towards that goal, she said.
The city wanted to sign on for a subscription early to show its commitment and in order to get the maximum amount available under the program, 28.3 megawatts of solar power, Wright said.
“If we tried to build that in the city, we’d be building 130 football fields of solar farm,” she said. “Subscribing to that maximum metered amount we have as a city operation will cost about $91,000 over the first four years over our traditional electric bill. Starting in year five, we start to make money back and our projected break-even point is in year seven. If we remain in the program for the full time, about 30 years, we could be revenue-positive.”
Program costs in the first four years are not expected to increase annual payments to Duke by more than $45,000, which is 0.6 percent of the city’s $7.9 million in electricity costs in 2019.
The Florida Public Service Commission has not set an official hearing date for the Duke Energy plan but it’s expected to take place this fall, with final agreements starting as early as 2022, Wright said.