How Henrico could win over $280,000 on the solar credit bet

HENRICO, Va. (WRIC) — When Henrico installed solar panels on three county buildings from 2019 to 2021, the price was electrifying: $0.00.

The county avoided paying a penny for the project by partnering with a private solar development company, Sun Tribe Holdings, to install the panels at no cost. Then the county repurchases the energy at below market rate, realizing “significant multi-million savings in energy costs.”

“We have partnered with Sun Tribe for many years and have completed six solar projects to date,” said County Executive Chief of Staff Cari Tretina.

Signs have already been installed at the Libbie Mill Library, the Mental Health and Developmental Services East Center and the Public Safety Building. Signs are currently being installed at the new JR Tucker and Highland Springs High Schools.

“Everyone wins, including the Earth,” Tretina said. “Henrico County ratepayers don’t pay for the installation of the solar panels, we have no maintenance obligations, and we get a discounted price on our electric rate.”

All the sauce now

While the county is already reaping the benefits of cheaper electricity, a recent council vote will allow the county to reap even more financial benefits.

The deal involves so-called Renewable Energy Certificates, or RECs. The certificates record the amount of renewable energy generated by the county through its projects and estimate the amount that will be generated over the life of the panels.

The certificates aren’t just something nice to frame on the wall – they can be sold to companies that need to meet emissions reduction targets, companies like Dominion Energy.

“We’re in a unique situation where our Virginia RECs are very valuable,” said Carrie Webster, energy manager at Henrico.

Indeed, under the Virginia Clean Economy Act, passed in 2020, Dominion can only purchase CERs generated in Virginia to help offset its carbon footprint. According to Webster, this made the market for Henrico’s RECs particularly hot.

The board voted at its April 12 meeting to authorize the county executive to enter into an agreement with Sun Tribe Holdings to sell the RECs on its behalf.

Pay for the future

As the county manager noted, Henrico was one of the first counties in Virginia to take advantage of the market.

“So you’re saying that Henrico is avant-garde?” joked Fairfield District Supervisor Frank Thornton.

Although County Manager John Vithoulkas can now sign an agreement to sell the RECs, he is not obligated to do so immediately. He told council members during a work session that he would consult with them before finalizing any sale.

At current market prices, “you’re looking at a net gain of $280,931,” Tretina said.

While the county has planned other solar projects, including panels to be installed on the Fairfield area library and county parks and recreation office, supply chain issues have delayed those plans.

Tretina said selling the county’s CERs could help jump-start those projects. “What we want to be able to do is use these credits to reduce the cost of future projects.”

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