KPP Energy’s PACE solar project continues to move forward at a rapid clip and a significant number of milestones were achieved recently, KPP Energy reported in the December issue of its KPP Lightning Round newsletter.
The KPP membership was briefed on the 18 megawatt solar project at the Annual Membership Meeting in December.
Members heard a presentation from KPP Chief Operating Officer James Ging about how the PACE solar project, once completed, will provide affordable, reliable and responsible power for the entire KPP membership, KPP Energy said in the newsletter.
Two major steps occurred on December 30. The first step was securing financing for the project. The second step was executing an engineering, procurement, and construction contract with developer Priority Power.
“As such, the project is deemed having begun construction in calendar year 2024. By completing these considerable tasks by the end of the year, KPP achieves an enhanced level of security in accessing tax credits for the project,” KPP said.
The last step is to receive final approval from the U.S. Department of Agriculture’s Rural Utilities Service prior to breaking ground on the project.
On November 12, KPP received a letter of conditions from USDA that was subsequently executed by KPP President Jason Newberry and KPP CEO Colin Hansen.
With the letter in hand, the only remaining step to receive full USDA approval to proceed is completion of environmental assessments in several locations, which is underway, the newsletter said.
KPP worked with Raymond James to issue bonds for the project. Construction financing is necessary to cover the cost of developing the projects as the PACE loan from the USDA is not available until all seven projects are in commercial operation.
Greg Vahrenberg from Raymond James and J.T. Klaus and Andrew Kovar of Triplett Woolf Garretson provided expert assistance to staff in finding the best source of financing, KPP Energy noted.
At the KPP Board meeting on December 13th, the KPP Board approved Resolution 2024-12-13 allowing the agency to move forward with issuing $51.6 million in Series A, 2024 Subordinated Taxable Electric Utility Revenue Bonds. Bonds are to be issued on a private placement basis and will be repaid with the USDA loan and expected tax credits. As noted previously, the bonds were issued on December 30th.
It is estimated that the construction schedule for the seven projects will be a year and a half. KPP is hoping to have 11 MW of solar online by the end of 2025 with the remaining 7 MW coming online in 2026.
As part of the PACE loan program, KPP said it is committed to fulfilling the requirements of the Community Benefit Plan (CBP) that was developed in conjunction with the project.
The CBP includes such items as:
• Community events to educate the public on solar projects
• Partnering with local businesses and contractors
• Publicizing solar projects in local media
• Work with KMU to create Solar Power Plant Operations program
• Train local employees on solar installations
• Tours for local high school students at each operating solar facility
