A school in Greater Manchester is set to save more than £2 million from its energy costs over the next 25 years following the installation of a new solar array and the start of a power purchase agreement (PPA) with Eden Sustainable.
The 430kW system was completed in April and is projected to save the school around £2.1 million over the lifetime of the installation. The school typically uses 414MWh throughout the year which is expected to be met almost entirely by the installation.
As part of the PPA with Eden, the school receives first call on any electricity generated at the site, allowing it to make the significant financial savings that motivated the project.
Principal Melanie Wicks found that using the existing electricity supplier the school would spend £3,087,390 on electric bills over 25 years, but the cut-price electricity deal with Eden would instead incur costs of just £919,083 for the same period.
According to Christine Ellis, business and finance director for Wellacre Academy, the school is expecting to make savings of up to £25,000 in the first year. This is forecast to rise throughout the lifetime of the scheme as electricity prices increase, particularly in the final five years.
She said: “We are hoping to halve our energy bills with electricity fixed at 6p with increases in line with the retail price index. One thing everyone knows is the price of electric will carry on going up, so fixing the price now is great for Wellacre moving forward.
“I know saving £2,168, 307 on electricity bills in 25 years almost sounds too good to be true, but we’ve seen the maths and know we will be saving tens of thousands each year.”
Speaking to SPP earlier today, Ellis added that the school would have been unable to experience the benefits of the system were it not for the PPA structure of the deal, which meant there were no upfront installation costs.
The deal was brought about by Green Energy International after pairing the school with Eden, which acted as the investor. According to director Arthur Bell, PPAs can offer similar benefits to other schools and businesses.
“These free fit solar arrays are fantastic for educational establishments, but also brilliant for ordinary businesses. It’s a win, win situation and you don’t get many of those in life,” he said.
“It’s a no brainer for schools – we can ensure they fix their electricity bill and the free fit systems can save them a fortune over the lifetime of the deal. We are doing similar deals for scores and scores of businesses and medium sized firms and even household names can see a return on their bottom line by fitting panels.”
The number of PPA schemes similar to Wellacre are likely to increase, with rises in business tax rates on solar installs due in April 2017. This could see taxes increase by up to eight times the current rate however they will not be applied to third party owned systems, suggesting PPAs could become even more attractive.
