Two years ago the City of Tucson began installing solar systems on City properties. Now those installations are ready to produce electricity. The City touted the project as saving money in electricity costs and generating revenue. On its face that would seem to be a good deal, but the details leave questions.
The project was financed by selling $11.2 million worth of “Clean Renewable Energy Bonds.” According to City Energy Manager Douglas Crockett, these bonds carry an annual interest rate of 1.97%. That means taxpayers will have to pay $220,640 in interest each year for a total of $5,516,000 in interest over the 25-year project life. Since those bonds will eventually have to be paid back, total cost the taxpayers (or ratepayers) is therefore $16,716,000.
The City estimates electricity cost savings of $3.9 million over the life of the project. They also claim the project will produce $6.2 million in revenue over the next 25 years. Savings plus revenue to the City total $10.1 million, but the taxpayer cost is $16,710,000 (interest plus principal). It appears that taxpayers would have been better off had the project not been built. If my perception of this project is in error, I would like a detailed explanation by the City explaining why the project is good for taxpayers.
This project seems to me to be another simple-minded, politically correct ploy to appear “sustainable” much like the $196 million the City is spending to build their 3.9-mile long, 19th century concept, “modern street car.”