Given the availability of federal tax incentives for renewable energy projects , it is common for organizations like ours which do not have a federal tax liability , to partner with entities that do for the project to benefit from tax savings . Given the modest projected returns from a direct investment of Authority capital into these projects , we evaluated scenarios where a third party would finance , operate and own the solar plus storage arrays and sell electricity to the Authority under Power Purchase Agreement ( PPA ) arrangements . This analysis indicated that we could reduce our electricity costs if we were to install approximately 1.2 MW of solar plus 200 kW of battery storage at the South Substation and an additional 400 kW of standalone storage at the North Substation . In the case of solar plus storage at the South Substation , lifetime electricity savings would be approximately 2-2.5 %. For a standalone storage project at the North Substation , the projected returns are not much greater than what we would realize if we owned the project while minimizing capital expenditures . This is because standalone storage only benefits from federal tax incentives when paired with solar . 22
Based on this analysis , were we to pursue a project of this type at Reagan National , a third party owned and managed solar plus storage project interconnected at the South Substation would be the likely choice . While lifetime savings of such a project are still relatively low , we would accrue them without making a capital investment . The electricity costs savings could be complimented by a stabilization of energy rates , and potential resiliency benefits ( i . e . operating certain facilities during a power outage ) from pairing storage with solar although quantifying these benefits from a monetary perspective is difficult . Finally , proceeding with such a project would also likely bring positive public relations benefits as a demonstration of our commitment to sustainability .
Participation in Green Power Programs
In addition to installing solar PV onsite at our airports , there are other opportunities to offset the emissions associated with our electricity use . Other major airports use carbon offsets as a component of their sustainability plans , including Dallas Fort Worth ( DFW ) and Los Angeles World Airports ( LAWA ). Our utility , Dominion Energy , offers the opportunity to purchase Renewable Energy Certificates ( RECs ) through its Green Power Program . 23 RECs represent the environmental benefits of renewable energy generation . Purchasing RECs can offset the impacts of our consumption of non-renewable energy at our facilities while supporting regional renewable energy generation .
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Reagan National : At an additional cost of 1.3 cents per kWh , offsetting 10 % 24 of our electricity use would cost us $ 114,000 per year based on our 2019 electricity consumption of 88 million kWh . At this level , we would also qualify for recognition for EPA ’ s Green Power Partnership program
Dulles International : The EPA offset requirement to earn recognition at Dulles International would be 7 % as annual consumption at the airport exceeds 100 million kWh . 25 To offset 7 % of
22 There is an on-going debate in Congress related to tax credits for standalone storage . To the degree that such
credits are enacted , the financial analysis for standalone storage under third party ownership models would show better results . 23 Dominion Energy , “ Dominion Energy Green Power for My Business .” Accessed June 10 , 2020 .
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