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<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Hi Allan,</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>(Also sent to RE Markets...)</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Boy don't the rats scurry when you talk about adding
pollution credits to the mix....</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>Utility Owned
Generation (UOG) on rooftops is a growing market. SCE (CA) and Duke (NC) are
doing it on large scale. New Jersey just got approval for their program.
PG&E (CA) has an application in with the CPUC which would allow them to do
it as well. PG&E's intent is to do ground mounts for the most part, but the
application doesn't prohibit rooftops. There are others at various stages of
development right now. All of the programs I know of are targeting large
commercial roofs and systems. </FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>The difference in the proposed PNM plan is that PNM would
be getting into smallerish systems than the others. This would be consistent
with SMUD's original PV Pioneer 1 (PVP1) program, which was intended to run from
1993 thru 1998, but continued in diminishing capacity until about 2001. SMUD let
out annual "block" contracts which, for example, looked like: 100 - 4kW systems
to be installed on customer roofs. A single contractor, commonly a
manufacturer back then, would have to provide turnkey systems and installations.
SMUD provided addresses to put them on. None of these systems was originally
permitted or inspected by the local AHJs. </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>Our very own Joel
Davidson was involved in a year or two of these contracts. I put in 30 or 40 of
them in later years personally.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>The primary difference between PNM and SMUD's old program
is that SMUD's program was intended to foster development of PV... Which it did.
SMUD is OUT of the business of owning PV for a number of reasons, not the least
of which is the Prick In Charge (PIC) of generation there. He doesn't like PV in
any way shape or form. </FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Most of this is the outcome of historical experience...
SMUD was investing in PV at a time when products, practices, and codes were not
nearly as mature as they are now. As a result, their invested $/watt was much
higher than we expect today. In addition, modules commonly performed at closer
to -10% of their rating and sometimes less. Inverters were largely unreliable
and, even the "reliable" ones were reliably inefficient. SMUD technicians were
the front line for service, and if you've ever paid the loaded price for one of
those guys, you would understand how the price could be high. In addition, the
previous leadership of SMUD's solar program was famous for reporting installed
costs far below actual. This ended up with something in the area of $3.9M more
than budgeted being spent in 10 years just to install them. Not to mention
service costs. When you add it all up, the delivered $/kWh of PV Pioneer 1
energy was a lot higher than we are capable of delivering today.
</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN><SPAN class=109253919-31072009><FONT
face=Arial color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>But wait! There's more! One of the unique aspects of SMUD's
PVP1 program was that customers paid $4 per month for the privilege of having
the PV on their roofs. This contract was for 10 years. SMUD paid for and
maintained the systems and received all the power. The 1-page contract never
said anything about "after 10 years you will own the system", but every single
PVP1 customer I ever spoke with told me they had been told they would. They all
named the same person. None of these customers knew one another so I have to
believe it happened.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Many of these customers thought they had been getting the
power all along. Imagine their frustration when they called up to have the
system "converted" to their side of the meter and found out that it was going to
cost them! SMUD worked out a very favorable pricing for conversion, but there
were rules. 1st of all, SMUD would only convert the systems if they were
completely removed & refurbished, including new inverter. Most of the
vintages were re-racked onto SolarMount rails and the customer had to reroof.
Additionally, due to lack of clear siting guidelines originally, quite a few
were disqualified for shade or poor orientation.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Several versions of systems ended up being deemed
unsuitable for reinstallation for one reason or another. Generally due to safety
&/or reliability concerns (Solec & Solarex Millennia Integra). In these
cases, assuming the site was suitable, the customer was offered a different
system based on modules removed from other PVP1 retirements. No matter whether
or not the customer ended up converting or retiring the system, SMUD paid for a
new roof in the area of the system.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>I believe that all the original PVP1 systems have been
converted to customer-owned or retired now. This process took 5 years and a LOT
of additional money being paid by SMUD. On many fronts I can totally understand
the bad taste for PV on the part of SMUD.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>I share this short-version of the SMUD experience so others
may gain insights into some of the hurdles which need to be addressed BEFORE
embarking on such a path. It is not intended to incriminate individuals or PV.
Everyone doing PV today is benefiting from the sacrifices SMUD's ratepayers
made. In ways you may not even realize. </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>Please be sure to
say, "thank you" next time you run into one. </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>The challenges
were multi-fold, but can be summed up in two ways: First, SMUD's well-meaning
intentions began at a time when there were many unknowns relative PV,
particularly in the area of equipment performance and costs, which resulted
in a de facto "open-ended blank check" once started. Second, the "end of life"
or "exit plan" was not clearly defined up front. </FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>I believe we have a much better understanding, relative
equipment performance and costs, today, so this shouldn't be nearly as
open-ended as it was 15 years ago. What is critical is having a well-defined
plan for the service life and disposition of the systems. Maintenance, repair,
and decommissioning. Who, how, what, where, when, and how
much?</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Fast forward to today's UOG programs. The utilities are
generally leasing the roof space from the owner. This will be a nightmare for
smaller systems in my opinion. Homeowners may find it difficult to sell their
homes if there is 15 years left on a 20 year lease of their roof, for example.
Not to mention the internal legal costs to the utility. I am concerned, as you
are, about guaranteed profits and how that plays out in rate cases. Perhaps a
"buyout" arrangement, where PNM installs and maintains them for 10 years without
a lease payment and the customer has the option to buy the system at a preset
price after that, would work. I would structure it so the price is level (not
declining). This would incentivize the customer to buy it at 10 years and not
wait. </FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Straightforward stuff. If the customer doesn't exercise the
option, then PNM is getting the electricity for the cost of
maintenance.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>This should allow
PNM to recover costs, especially when you factor in depreciation and carbon
credits, and the customer would gain the benefit of 10-15 years of PV at a
favorable price. This approach should shield ratepayers while providing PNM
& PV Homeowners with the primary benefits they each want/need. The
local PV contractors would benefit from service work and so on. This would also
free up PNM capital to do something else in 10 years instead of having aging
assets on their books. One key to this being successful is having the
system permitted and inspected when installed. I haven't boiled this through
yet, but it's a thought worthy of consideration. </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff
size=2></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>The most important thing to me is that we don't dismiss the
concept just because it's the utility that is proposing it. I'm sure
you have your reasons for smelling a rat and I'm sure they are justifiable. The
way I understand it, PNM hasn't always been known as a "good guy" utility. Even
so, </FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial color=#0000ff
size=2>UOG doesn't have to be a bad thing. I believe it is crucial that
the PSC put a cap on the costs that would be eligible for PNM to
recover in rates. This ensures that they manage the program in a cost-effective
manner. This is a key component to the PG&E application and, for what it's
worth, one of the most important aspects. PG&E is asking for "up to" a
certain amount to be eligible for cost recovery via rates. If they go over that,
they have to eat it. If they come in under that, only the actual costs will be
eligible for recovery in rates.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>In PG&E's application they have laid out their
projected costs and the basis for them. I sat down with the head guy of their
Power Generation and went through this plan with a focus on
the O&M. From my perspective, capital costs are relatively flat. They
are known & understood. The vapor is generally in unrealistic O&M in my
experience. This goes for private PPA companies, too. </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>I have to say
that PG&E's O&M plan, expectations, and $ numbers were very realistic,
which I didn't expect. Pleasant surprise! </FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>I STRONGLY advise
modeling a UOG program on the relevant portions of PG&E's proposal. (Cap
on costs + realistic O&M)</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>DO NOT BUDGE OFF COST CAPS! This is a
fall-on-your-sword issue! </FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009></SPAN><SPAN
class=109253919-31072009></SPAN><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>I think it will be hard to come up with a simple and
cost-effective model for the smaller systems. Perhaps a new 30-home subdivision
where a 3.5kW UOG PV system was standard equipment? This could be an
interesting partnership concept for a developer & the utility. PV
on new subdivisions has been a severe PITA in my experience. Hemmorhoid Gigante!
</FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial color=#0000ff
size=2>But I haven't done any where it's UOG. By doing this at the
developer/subdivision level, the roof-mounted PV could be setup as a utility
easement, which would be filed with the county registrar right on the deed.
There are already utility easements on the property anyway. This avoids a lot of
the hassle associated with individual homeowner leases and all that. The
easement could have a termination date. As I think about it, I like the 10-year
"buyout" plan here.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Peak subdivision demand would likely be reduced by some
amount, thereby reducing PNM distribution equipment requirements. Don't get too
excited about that. Even if there's 100kW in the subdivision, it's not likely
that the true peak would be reduced by that amount. Probably something on the
order of 40kW is reasonable. (PV doesn't peak when the subdivision demand does).
40kW is a little spark to the substation, so it's not huge by any means.
</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>I could see this being strategically setup in a win-win
manner... New, high-efficiency homes with "Smart" meters, etc.
</FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial color=#0000ff
size=2>The customer is going to get all their electricity from the utility. It
just so happens that some portion of it is generated onsite. Why is that so bad?
If part of the deal is that they come with FULL 10 YEAR WARRANTIES, PNM's
ratepayer exposure is minimized. If the customer has the option to buy the
system at a preset price after 10 years, everybody should come out
whole.</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Regarding the "larger" systems, these should be more
straightforward, but not without challenges. We have to think about these
systems in terms of having 20 or 25 year service lives. Since these are
likely to be on commercial properties, they are gonna have to be on
commercial terms. The most straightforward method would be for PNM to request a
demonstration (limited term) "Retail Solar" tariff and setup shop as a PPA.
</FONT></SPAN></FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>As with commercial PPAs, this tariff would be structured so
the Year 1 price is very close to current retail and subsequent years are
adjusted at a nominal escalation rate that results in lower than "non-solar"
retail. The difference grows over time. </FONT></SPAN></FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>But that's not
likely to happen. So... If I'm the property owner, "What's in it for me?
Roof leaks?". </FONT></SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN
class=109253919-31072009></SPAN></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>Since we're thinking these
are gonna be smallerish in the grand scheme of things, 100 - 250kW (I
remember when that was HUGE!), PNM is gonna have to come up with some juice for
the property owners. Basically, if PNM is putting PV on their roof, then the
owners will lose the opportunity to do it themselves, so they will want
compensation and assurances. Flat roofs are notorious for leakage and flat-roof
owners are notorious for being gun-shy about their roofs. If I owned one of
these and the utility wanted to install PV on it, I'd be wanting some cash.
Whatever "lease" payment is negotiated is going to be added straight onto the
cost of the PV. So will the administrative and legal costs. Any time you are
looking at a relatively low number of specialty contracts, the per-unit cost is
high. Since they are thinking in terms of just over a dozen in this class, bend
over. Take my word for it, lawyers cost $ and doing onesey-twosey with
commercial property owners chews up a lot of legal
time.</SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN
class=109253919-31072009></SPAN></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>Since there isn't likely to
be a direct energy benefit to the property owner, I would consider targeting
shopping centers. These folks are into leasing stuff by the square foot and they
deal with such things every day. This is much different than an industrial or
individual commercial party who only deals with it every 10 years or
so. </SPAN></FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>If PNM cracks the code
with these folks, they should end up with a happy medium.
</SPAN></FONT></SPAN><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>I say shopping centers, as
opposed to shopping malls. Next to dealing with government, malls are the
epitome of painful. Ever had a bad case of poison oak or poison ivy?
Malls are worse.</SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN
class=109253919-31072009></SPAN></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>Hate to be non-communist
here, but I would look for a single entity that owns or controls enough
roof-space to do the whole commercial part of the program. This will minimize
transaction costs greatly. If I were setting up the program for the utility, I
would go to my key-accounts people and ask them for suggestions of which
commercial property management companies were decent to work with. I would take
that list, look at their properties from satellite view and pick the most
favorable one to talk to first. I would go through the list until I had three
interested and reasonable candidates. Cherry pick from the top down. Then I
would have them all come in and sit down for a meeting. All at once. Lay
out the plan and give them your price per sq. ft.. Tell them how you intend
to address roof issues. Hand them a copy of the sample contract. Tell
them it's first come, first serve. Sweeten the pot by telling them maybe we can
do a little community green-washing, call the local news for a "good news"
story, etc. Then kick them out of the office. First one back in with a signed
commitment gets to go forward. Just like that.</SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2></FONT></SPAN></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>OK. I've been whacking keys
long enough. Hopefully there are some valuable pieces in here that prove
beneficial for you and your neighbors. </SPAN></FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2>If you are
interested in more or care to discuss finer details and strategies for a
potential program there, contact me off-list. My bottom line is that PV should
be appropriately deployed and maintained if a nickel of public money is
involved. This hasn't & isn't always the case. I hope it can be in New
Mexico!</FONT></SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN
class=109253919-31072009></SPAN></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009>Pray for
Sun!</SPAN></FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2><SPAN class=109253919-31072009></SPAN></FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff size=2><SPAN
class=109253919-31072009></SPAN></FONT></SPAN><SPAN
class=109253919-31072009><FONT face=Arial color=#0000ff
size=2></FONT></SPAN> </DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Matt Lafferty</FONT></SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009><FONT face=Arial
color=#0000ff size=2>Solar Janitor</FONT> </SPAN></DIV>
<DIV dir=ltr align=left><SPAN class=109253919-31072009> </SPAN></DIV>
<DIV dir=ltr align=left>
<HR tabIndex=-1>
</DIV>
<DIV dir=ltr align=left><FONT face=Tahoma size=2><B>From:</B>
re-wrenches-bounces@lists.re-wrenches.org
[mailto:re-wrenches-bounces@lists.re-wrenches.org] <B>On Behalf Of </B>Allan
Sindelar<BR><B>Sent:</B> Wednesday, July 29, 2009 1:40 PM<BR><B>To:</B>
'RE-wrenches'<BR><B>Subject:</B> [RE-wrenches] FW: Utility-owned PV systems on
roofs<BR></FONT><BR></DIV>
<DIV></DIV>
<DIV class=Section1>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Wrenches, <o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Below is an excerpt of an announcement
about <st1:State w:st="on"><st1:place w:st="on">New
Mexico</st1:place></st1:State>’s largest IOU developing a utility-owned PV roofs
program. They will contract the installations but own the systems. The details
aren’t yet out; the announcement is about an upcoming meeting to gather
feedback.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black"><o:p> </o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">I can’t help but smell a rat. I want to be
prepared to challenge the plan if appropriate. It seems to me that a regulated
monopoly with a guaranteed rate of return and deep pockets should not own PV
systems on customers’ roofs, and shouldn’t be competing with the private sector
to offer systems.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black"><o:p> </o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">I remember that some years back this came
up in <st1:State w:st="on"><st1:place
w:st="on">California</st1:place></st1:State> and CalSEIA successfully fought it.
I also recall that SMUD originated this approach and got out of it as a failed
experiment, but I don’t know the whole story.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black"><o:p> </o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">I’m writing to request links, archives,
strategies, and experiences from similar battles (or not) elsewhere on this
issue. I would like to be well prepared if we are to fight
this.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Thank you.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black"><o:p> </o:p></SPAN></FONT></P>
<DIV>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Allan
Sindelar<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=2><SPAN
style="FONT-SIZE: 10pt; COLOR: black"><A
href="mailto:Allan@positiveenergysolar.com">Allan@positiveenergysolar.com</A></SPAN></FONT><FONT
color=black><SPAN style="COLOR: black"><o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=2><SPAN
style="FONT-SIZE: 10pt; COLOR: black">NABCEP Certified Photovoltaic
Installer</SPAN></FONT><FONT color=black><SPAN
style="COLOR: black"><o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=2><SPAN
style="FONT-SIZE: 10pt; COLOR: black">EE98J Journeyman
Electrician</SPAN></FONT><FONT color=black><SPAN
style="COLOR: black"><o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Positive Energy,
Inc.<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">3201 Calle
Marie<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><st1:place w:st="on"><st1:City w:st="on"><FONT
face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">Santa Fe</SPAN></FONT></st1:City><FONT
color=black><SPAN style="COLOR: black">, <st1:State w:st="on">New
Mexico</st1:State> <st1:PostalCode
w:st="on">87507</st1:PostalCode></SPAN></FONT></st1:place><FONT
color=black><SPAN style="COLOR: black"><o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" color=black size=3><SPAN
style="FONT-SIZE: 12pt; COLOR: black">505 424-1112<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face=Arial color=black size=2><SPAN
style="FONT-SIZE: 10pt; COLOR: black; FONT-FAMILY: Arial"><A
href="http://www.positiveenergysolar.com">www.positiveenergysolar.com</A></SPAN></FONT><o:p></o:p></P></DIV>
<DIV>
<DIV class=MsoNormal style="TEXT-ALIGN: center" align=center><FONT
face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt">
<HR tabIndex=-1 align=center width="100%" SIZE=2>
</SPAN></FONT></DIV>
<P class=MsoNormal><B><FONT face=Tahoma size=2><SPAN
style="FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">From:</SPAN></FONT></B><FONT
face=Tahoma size=2><SPAN style="FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">
<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal><B><FONT face=Tahoma size=2><SPAN
style="FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">Subject:</SPAN></FONT></B><FONT
face=Tahoma size=2><SPAN style="FONT-SIZE: 10pt; FONT-FAMILY: Tahoma"> PNM Solar
PV Workshop</SPAN></FONT><o:p></o:p></P></DIV>
<P><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt">As part of
the PNM renewable energy strategy, we would like your feedback on an innovative
program we are developing that would place utility-owned solar PV systems on
customer roof tops or customer land. Because of your experience installing
solar PV systems, we value your input and would like for you to join us in this
interactive workshop on <B><SPAN style="FONT-WEIGHT: bold">Wednesday August 5,
2009</SPAN></B><FONT color=black><SPAN
style="COLOR: black"><o:p></o:p></SPAN></FONT></SPAN></FONT></P>
<P><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt">In this
workshop, we will share our plans for this program and get your ideas.
Here are some program highlights so far:<o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l0 level4 lfo1"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>4 MW of installed solar capacity
(turnkey installation by PV system integrator or PV contractor to be
determined)<o:p></o:p></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l0 level4 lfo1"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>Solar PV systems ranging in size
from 2kW to 250kW on customer rooftops and customer land <o:p></o:p></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l0 level4 lfo1"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>Awarded in blocks (to be
determined): EXAMPLES ONLY<o:p></o:p></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto"><B><FONT
face="Times New Roman" size=3><SPAN
style="FONT-WEIGHT: bold; FONT-SIZE: 12pt"> </SPAN></FONT></B>
50 residential systems of 2kW totaling 100 kW
<BR> 10 systems of 100 kW totaling
1MW
<BR> 4 systems of 250 kW totaling 1MW
<o:p></o:p></P>
<P><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt">The
objectives of the workshop are: <o:p></o:p></SPAN></FONT></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l1 level4 lfo2"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>To select optimal block award
<o:p></o:p></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l1 level4 lfo2"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>To brainstorm optimal size of
residential and commercial PV system<o:p></o:p></P>
<P class=MsoNormal
style="MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; mso-margin-top-alt: auto; mso-margin-bottom-alt: auto; mso-list: l1 level4 lfo2"><![if !supportLists]><FONT
face=Wingdings size=2><SPAN
style="FONT-SIZE: 10pt; FONT-FAMILY: Wingdings"><SPAN
style="mso-list: Ignore">§<FONT face="Times New Roman" size=1><SPAN
style="FONT: 7pt 'Times New Roman'">
</SPAN></FONT></SPAN></SPAN></FONT><![endif]>To explore program
design<o:p></o:p></P>
<P class=MsoNormal style="MARGIN-LEFT: 0.25in"><FONT face="Times New Roman"
size=3><SPAN style="FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=MsoNormal><FONT face="Times New Roman" size=3><SPAN
style="FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P></DIV></BODY></HTML>