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Tilting at Jacobs' Windmill
Don Wedding, UT-AAUP
Linda Rouillard, UT-AAUP
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On July 15, 2009, The University of Toledo (UT) entered into a 20 year agreement with Constellation Solar for the purchase of onsite solar and wind power at the UT Scott Park Campus of Energy and Innovation. The contract was signed by UT President Lloyd Jacobs. The Scott Park campus may be the site of the UT School of Solar and Advanced Renewable Energy. This is a school without students, without tenured or tenure-track faculty, and without funding, but it does have alternative energy facilities at Scott Park under the watch of UT Vice President Chuck Lehnert, one of Jacobs' most trusted lieutenants.
The UT-AAUP obtained a copy of the Constellation agreement under the Ohio Public Records Act. Paragraph 5.2 of the Constellation agreement provides that UT will not voluntarily disclose the agreement unless required to do so under the Ohio Public Records Act.
This purchase agreement provides for Constellation to construct alternative energy facilities at Scott Park and generate solar and wind energy for sale to UT. Constellation receives all environmental incentives including energy tax credits and rebates.
Paragraph 5.7 provides that Constellation will retain title to all of the solar and wind generating equipment and own all renewable energy credits generated. Paragraph 9.1 (e) provides that UT may purchase the equipment after the sixth (6th) year of the agreement. Exhibit A of the agreement provides a buyout price of $3,552,000 at year six, $2,700,000 at year 10, $1,725,000 at year 15, and fair market value thereafter up to year 20.
Exhibit A also provides that wind generated electrical production "... will not be metered...regardless of whether the Wind Generating Equipment functions properly, is properly maintained, or any other problems, and UT shall be responsible for reimbursing Constellation for any reduction in Environmental Incentives as a result."
Exhibit A further provides for a rate of $0.1620 per kWh in year one with a total estimated annual production of 1,454,040 kWh (for the solar and wind generation) and UT payments to Constellation of $235,554. The $0.1620 rate increases at 3% per year over 20 years to $0.2841 with an annual production of 1,331,488 kWh and UT payments of $378,233. The total estimated UT payments to Constellation under the agreement are $6,031,286.
Because the wind power is not metered, it is not known how much power is actually being generated. Nevertheless the agreement requires that UT pay Constellation for wind energy each month. The wind turbine has not operated most of the time, only about two months out of the last 20 months. Why did Chuck Lehnert allow the wind turbine to remain inoperative for over a year while UT made monthly payments for unmetered electric power not being delivered?
The inoperative turbine has two blades instead of three blades, presumably because it is intended for off-shore research on Lake Erie. Turbine energy data was to have been provided to UT faculty for Lake Erie turbine research. Because the turbine has been inoperative most of the time and is not metered, it has little or no research value.
For all three campuses in 2010 UT paid $7,796,555 to Toledo Edison for 123,802,167 kWh of electric power for an average rate of $0.063 per kWh. This is a small fraction of the $0.1620 rate paid to Constellation under the agreement for unmetered and undelivered power, a rate which increases under the agreement to $0.2841 per kWh. Rather than celebrating a PR success, these costly arrangements are an embarrassment to the faculty and students whose research is dedicated to making renewables the lowest cost and best form of electric power production.
The 20 year UT-Constellation agreement signed by Lloyd Jacobs is unfair to UT. It was done for PR purposes to create political support for the new school based on alternative energy. Would Jacobs sign such an agreement if his own purse was at risk? Would he sign such an agreement for electric power to his Michigan farm? Would he pay for unmetered power or power not delivered to his farm house and barn?
The UT-AAUP is investigating and exposing the incompetence and malfeasance of the Jacobs Administration. In the weeks and months to come, more documented newsletters will be published. We invite faculty, staff, administrators, students, retirees, alumni, and interested persons to continue passing information to the UT-AAUP in complete confidence.
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