In order to estimate the amount of electricity generated by each carport, we used the equation below (figure 1). The variables in this equation include wattage produced per solar panel, area of the solar panel, surface area of the parking cover shade. To calculate the area of the cover shade we assumed 70% utilization of the parking lot’s surface area and an average of 150 sq ft per parking space; this average took into consideration the larger sized vehicles in the U.S. Based on these numbers, the required amount of solar panels per parking space was 6.8 (table 1). Our chosen solar panel can generate 0.37 KW per hour, given that the sunlight reaches the solar panel 9 hours per day.
Figure 1 - Formula to Calculate KWh Per Carport
Using the average of 220 sunny days per year in Houston and taking into consideration the sun’s passage over the solar panels during the day, we estimated the time of solar panel production per day to be 9 hrs.
The table (1) below shows these estimates for parking lot C and East garage:
Table 1 - Lot C and East Garage Solar Panels calculations
Using Houston’s average electricity rate of $0.11 per kilowatt hour and calculating electricity generated per year with the carport in operation, we estimated the amount saved is $750,000 per year.
By constructing the carport in parking lot C and East garage the university can save $750,000 per year. After obtaining this estimate, we were able to calculate the years to payoff, 12 years, the carport project at University of Houston.
Download Project Calculations
With the help of Jefferson Sales, an estimation engineer, we were able to develop a detailed cost per parking spot. Table (2) shows the calculations in detail.
These calculations were based on adding the shades and solar panels to an existing parking spot.
Table 2 - Lot C and East Garage Cost Per Parking Spot
Table 3 - Lot C and East Garage Project Calculations
After analyzing the initial costs and savings of our solar carport project we estimate an approximate cost of $8.8 Million. Based on the average KWh cost of electricity in Houston, $0.11, our estimated recovery amount per year is $750,000. Therefore our pay off duration for this project will be 12 years.
Total price was calculated while taking a 30% Federal tax credit under consideration. However, the tax beniftes will not be applied if the university choses the Power Purchase Agreement (PPA)
The Power Purchase Agreement (PPA) has been successful in driving the growth of the solar power industry. The agreement mirrors a lease whereby the solar company maintains the right to the solar equipment and the consumer pays a monthly power fee that is less than the conventional electricity distributors. However, while this arrangement is attractive to some users, people need to understand its pros and cons to make informed decisions concerning green energy.
The PPA enables the property owner to have a solar power system without the need for paying the upfront costs of a photovoltaic system. Furthermore, the PPA provides a predictable energy price for the duration of the contract one signs with the operator of the PV system. This shields one from the unpredictable price increases of conventional utility companies. The property owner also does not incur costs such as maintenance costs because the provider takes care of them (EPA.gov). The agreement protects the individual from liabilities if the PV system fails prematurely. However, if a person owns the installation, he or she will have to shoulder the burden of replacements and maintenance. Thus, the PPA makes it easy to budget electricity expenses without the fear of extra costs.
The main drawback of the PPA is that it makes it complicated to plan near future redevelopments in case the university wants to redevelop the parking lot. The PPA provider legally owns the solar system, and as such, one cannot sell it (Quin).
Table 4 - UH Financing Vs Purchase agreement
The table above shows the difference between a purchase agreement and the university owning and financing the entire solar project. The duration of the purchase agreement is 20 years with a fixed electricity cost of $0.07 per KWh, which will save the university $5.4 millions over the PPA duration. However, if the university financed the project, the savings incurred from the solar carport project will enable the university to pay off the project in 12 years.
Figure 2 - UH Financing Vs Purchase agreement
The graph shows a comparison between the PPA and the university owning/financing the project over the duration of 20 years. Over the duration of the 20 years the university will start saving after the 13th year if they chose to finance the project and pay off the total project costs.
Even though the savings from the university financing the project is 9% higher than the PPA, however, the university has to pay the $8.8 million upfront cost. Additionally, the university will still have to take into consideration the maintenance and operational costs. Therefore, our recommendation is to choose the PPA.