NREL is a national laboratory of the U.S. Department of Energy, 

Office of Energy Efficiency & Renewable Energy, operated by the 

Alliance for Sustainable Energy, LLC.

Contract No. DE-AC36-08GO28308

Feasibility Study of Economics 

and Performance of Solar 

Photovoltaics at the Crazy 

Horse Landfill Site in Salinas, 

California

A Study Prepared in Partnership with the 

Environmental Protection Agency for the 

RE-Powering America’s Land Initiative: 

Siting Renewable Energy on Potentially 

Contaminated Land and Mine Sites

Blaise Stoltenberg, Craig Konz, and Gail Mosey

Produced under direction of the Environmental Protection Agency 

(EPA) by the National Renewable Energy Laboratory (NREL) under 

Interagency Agreement IAG-09-1751 and Task No. WFD4.1001. 

Technical Report

NREL/TP-7A30-57893

March 2013 
NREL is a national laboratory of the U.S. Department of Energy, Office of Energy 

Efficiency & Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Contract No. DE-AC36-08GO28308

National Renewable Energy Laboratory

15013 Denver West Parkway

Golden, CO 80401

303-275-3000 • www.nrel.gov

Feasibility Study of Economics 

and Performance of Solar 

Photovoltaics at the Crazy 

Horse Landfill Site in Salinas, 

California

A Study Prepared in Partnership with the 

Environmental Protection Agency for the 

RE-Powering America’s Land Initiative: 

Siting Renewable Energy on Potentially 

Contaminated Land and Mine Sites

Blaise Stoltenberg, Craig Konz, and Gail Mosey 

Prepared under Task No. WFD4.1001

Technical Report

NREL/TP-7A30-57893

March 2013 
NOTICE

This manuscript has been authored by employees of the Alliance for Sustainable Energy, LLC (“Alliance”) under 

Contract No. DE-AC36-08GO28308 with the U.S. Department of Energy (“DOE”).

This report was prepared as an account of work sponsored by an agency of the United States government. 

Neither the United States government nor any agency thereof, nor any of their employees, makes any warranty, 

express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of 

any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately 

owned rights. Reference herein to any specific commercial product, process, or service by trade name, 

trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, 

or favoring by the United States government or any agency thereof. The views and opinions of authors expressed 

herein do not necessarily state or reflect those of the United States government or any agency thereof.

Cover Photos: (left to right) PIX 16416, PIX 17423, PIX 16560, PIX 17613, PIX 17436, PIX 17721

Printed on paper containing at least 50% wastepaper, including 10% post consumer waste. 
iii

Acknowledgments

The National Renewable Energy Laboratory (NREL) thanks the U.S. Environmental Protection 

Agency (EPA) for its interest in securing NREL’s technical expertise. In particular, NREL and 

the assessment team for this project are grateful to the Crazy Horse Landfill facility managers, 

engineers, and operators for their generous assistance and cooperation. 

Special thanks go to Jenny Mitchell, Patrick Mathews, Dave Meza, and Jose Gamboa from the 

Salinas Valley Solid Waste Authority for hosting the site; Lura Matthews, Shea Jones, and 

Jessica Trice from EPA; and Katie Brown, AAAS Science & Technology Policy fellow hosted 

by EPA. 
iv

List of Acronyms

AC alternating current

a-Si amorphous silicon 

BOS balance of system 

CdTe cadmium telluride

CHL Crazy Horse Landfill

CSI California Solar Initiative

DC direct current

EPA U.S. Environmental Protection Agency 

FTE full-time equivalent

IRR internal rate of return

ITC investment tax credit

JEDI Jobs and Economic Development Impact model 

kW kilowatt

kWh kilowatt-hour 

LCOE levelized cost of energy

LFG landfill gas

MACRS modified accelerated cost recovery system

MW megawatt

NEG net energy generated

NREL National Renewable Energy Laboratory

O&M operations and maintenance 

PG&E Pacific Gas & Electric 

PPA power purchase agreement

PV photovoltaic 

REC renewable energy certificate

SAM System Advisor Model 

SPE special purpose entity 

SSA solar services agreement

SVSWA Salinas Valley Solid Waste Authority

TOU time of use

VNM virtual net metering
v 

Executive Summary

The U.S. Environmental Protection Agency (EPA), in accordance with the RE-Powering 

America’s Land initiative, selected the Crazy Horse Landfill site in Salinas, California, for a 

feasibility study of renewable energy production. The National Renewable Energy Laboratory 

(NREL) was contacted to provide technical assistance for this project. The purpose of this report 

is to assess the site for a possible photovoltaic (PV) system installation and estimate the cost, 

performance, operation and maintenance requirements, and site impacts of different PV options. 

In addition, the report recommends financing options that could assist in the implementation of a 

PV system at the site. 

Crazy Horse Landfill1

 is located just north of Salinas, California, and is owned by the Salinas 

Valley Solid Waste Authority (SVSWA). The 160-acre sanitary landfill site has operated since 

1934; before that, it was used as an open burn dump. During the 1970s, waste also came from the 

Firestone Tire and Rubber Company. Since 1987, Pacific Energy has operated a 1.3-MW landfill 

gas plant for electricity generation on site, which was recently dismantled and will likely be

replaced by a 3.2-MW plant. The landfill was closed to the public in 2009. Recently, the landfill 

has been capped with a geomembrane and covered by artificial turf. 

The feasibility of a PV system installed on a landfill Superfund site is highly impacted by the 

available area for an array, solar resource, operating status, ground conditions and restrictions, 

distance to transmission lines, and distance to major roads. The Crazy Horse Landfill has suitable 

area for a large-scale PV system, and the solar resource in Salinas, California, is adequate. 

The Crazy Horse Landfill site is approximately 160 acres with about 20 acres appropriate for 

installation of a PV system. While this entire area does not need to be developed at one time, 

calculations for this analysis reflect the solar potential if the total feasible area is used. It is 

possible to add to the installed capacity as funding becomes available. 

The economic feasibility of a potential PV system on the Crazy Horse Landfill site depends 

greatly on the purchase price of the electricity produced. For a net-metered system, the 

economics of the potential system can also be analyzed using the current electric rate for Pacific 

Gas and Electric (PG&E) of $0.17/kWh and incentives available to the site. Current incentives 

considered include the California Solar Initiative performance-based incentive of $0.088/kWh 

produced for government/non-profits. This is the last remaining tier of the California Solar 

Initiative (CSI) rebates for PG&E territory and has 84.4 MW of capacity remaining. The 

incentive is paid monthly for 5 years, and the total paid based on estimated production is over 

$600,000. To be eligible, the system must produce electricity for the on-site load, using the prior 

12-month usage history. The maximum system size for the incentive is 1 MW, so using the entire 

area available at the site would exceed this restriction and make a portion or possibly all of the 

system ineligible for the CSI incentive. If the system is developed and owned by a third party as 

recommended, the CSI incentives become irrelevant as the system size is over 1 MW and is nongovernment owned. Table ES-1 summarizes the system performance and economics of a 

potential system that would use all available areas that were surveyed at the Crazy Horse 

Landfill site. The table shows the annual energy output from the system along with the number 

 

1 The EPA website that describes the Crazy Horse Landfill Superfund site is located at: 

http://yosemite.epa.gov/r9/sfund/r9sfdocw.nsf/vwsoalphabetic/Crazy+Horse+Sanitary+Landfill?OpenDocument. 
vi 

of average American households that could be powered off of such a system and estimated 

job creation. 

As indicated in Table ES-1, the maximum system size of 3.5 MW for crystalline technology 

produces approximately 5,253 MWh/yr. The system is expected to have a payback of 13–14 

years if SVSWA owns the system or a 15% internal rate of return to the investor if the power is 

sold to the utility through a power purchase agreement (PPA)—a contract to sell electricity at a 

negotiated rate over a fixed period of time. The PPA price is estimated to be $0.16–$0.18/kWh 

with a levelized cost of energy (LCOE) of $0.14–$0.16/kWh assuming third-party PPA 

financing. This includes the current cost of energy, expected installation cost of PV, site solar 

resource, operation and maintenance, and no incentives for the proposed PV system. This LCOE

and PPA price range is deemed reasonable and, as such, a solar PV system represents a good 

solution for the site if solar production can offset retail electricity use or if lower installed costs 

can be achieved. 

The system economics presented in this analysis are based on many assumptions that represent 

the best information that NREL can reference at the time of the analysis and, therefore, should be 

considered best estimates. Only a firm proposal developed by a solar installer or developer will

give the true economics of a system. Based on this, there are two assumptions that should be 

addressed specifically. First, no incentives were modeled in this economic analysis. Even though 

there appears to be no incentives presently available in California, it is likely there will be more 

in the future that will improve system economics. Second, system cost is based on published data 

with adjustments for tracking and landfill applications based on industry research. Costs in the 

solar industry are changing more rapidly than the availability of published data; therefore, the 

proposed system cost from a solar developer might be considerably less than calculated in this 

report and could greatly improve system economics.
vii 

Table ES-1. Crazy Horse Landfill PV System Performance and Economics by System Type

Financing

PV 

System 

Sizea

Net Annual 

Output

Annual 

O&M

LCOE Real 

Low b

LCOE Real 

High c

PPA Price 

Low b

PPA Price 

High c

Payback 

Period 

Low b

Payback 

Period 

High c

Jobs 

Created d

Jobs 

Sustained e

(kW) (kWh/year) ($/year) ($/kWh) ($/kWh) ($/kWh) ($/kWh) (years) (years) (job-year) (job-year)

PPA/ 

Investor 0.139 0.156 0.155 0.175 n/a n/a 

Municipal 

Ownership 0.147 0.166 n/a n/a 12.7 14.2

a

 Data assume a maximum usable area of 20 acres and 5.74 acres/MW

b

 "Low" is low end of installed cost range: $3.49/Watt

c

 "High" is the high end of the installed cost range: $4.00/Watt

d

 Job-years created as a result of project capital investment including direct, indirect, and induced jobs.

e

 Jobs (direct, indirect, and induced) sustained as a result of operations and maintenance (O&M) of the system.

n/a: not applicable

3,500 5,253,204

 105,000 

(year 1-15) 

70,000 

(year 16-25) 

103 1.3
viii

Table of Contents

1 Site Background ................................................................................................................................... 1

2 Development of a Photovoltaic System on Landfills........................................................................ 3

3 PV Systems ........................................................................................................................................... 4

3.1 PV Overview .................................................................................................................................... 4

3.2 Major System Components .............................................................................................................. 5

3.2.1 PV Module .......................................................................................................................... 5

3.2.2 Inverter ................................................................................................................................ 7

3.2.3 Balance-of-System Components ......................................................................................... 8

3.2.4 Operation and Maintenance .............................................................................................. 10

3.3 Siting Considerations ..................................................................................................................... 10

4 Proposed Installation Location Information .................................................................................... 11

4.1 Crazy Horse Landfill Site PV System............................................................................................ 11

4.2 Utility-Resource Considerations .................................................................................................... 11

4.3 Feasible PV System Installation Area ............................................................................................ 12

4.4 PV Site Solar Resource .................................................................................................................. 13

4.5 Crazy Horse Landfill Energy Usage .............................................................................................. 15

4.5.1 Current Energy Use .......................................................................................................... 15

4.5.2 Net Metering ..................................................................................................................... 17

4.5.3 Virtual Net Metering ......................................................................................................... 18

5 Economics and Performance............................................................................................................ 19

5.1 Assumptions and Input Data for Analysis ..................................................................................... 19

5.2 SAM Forecasted Economic Performance ...................................................................................... 21

5.3 Job Analysis and Impact ................................................................................................................ 22

5.4 Financing Opportunities................................................................................................................. 24

5.4.1 Owner and Operator Financing ......................................................................................... 24

5.4.2 Third-Party Developers with Power Purchase Agreements .............................................. 24

5.4.3 Third-Party “Flip” Agreements......................................................................................... 25

5.4.4 Hybrid Financial Structures .............................................................................................. 25

5.4.5 Solar Services Agreement and Operating Lease ............................................................... 25

5.4.6 Sale/Leaseback .................................................................................................................. 26

5.4.7 Community Solar/Solar Gardens ...................................................................................... 26

6 Conclusions and Recommendations ............................................................................................... 27

Appendix A. Assessment and Calculations Assumptions ................................................................... 28

Appendix B. Results of the S\VWHP Advisor Model............................................................................... 29

Appendix C. Results of the JEDI Model.................................................................................................. 30
ix

List of Figures

Figure 1. Generation of electricity from a PV cell ...........................................................................4

Figure 2. Ground-mounted array diagram .......................................................................................5

Figure 3. Mono- and poly-crystalline solar panels ..........................................................................6

Figure 4. Thin-film solar panels installed on (left) solar energy cover and (middle/right) fixed-tilt 

mounting system ........................................................................................................................6

Figure 5. String inverter ...................................................................................................................8

Figure 6. Views of the feasible area for PV at the Crazy Horse Landfill ......................................11

Figure 7. Aerial view of the feasible area (orange) for PV at the Crazy Horse Landfill site ........13

Figure B-1. Cost of electricity for different costs and ownership options .....................................29

Figure B-2. System electricity production .....................................................................................29

List of Tables

Table ES-1. Crazy Horse Landfill PV System Performance and Economics by System Type .... vii

Table 1. Energy Density by Panel and System ................................................................................9

Table 2. Site Identification Information and Specifications ..........................................................14

Table 3. Performance Results for 1-kW, 20-Degree Fixed-Tilt PV ..............................................14

Table 4 . Meters and Rate Schedules .............................................................................................15

Table 5. PG&E A-1 Rate Schedule................................................................................................15

Table 6. PG&E A-10 Rate Schedules ............................................................................................16

Table 7. Financial and Technical Assumptions Used in Analysis .................................................20

Table 8. Crazy Horse Landfill Site Summary ................................................................................22

Table A-1. Cost, System, and Other Assessment Assumptions ....................................................28
1 

1 Site Background

The Crazy Horse Landfill is located in Salinas, California. Salinas is located about 

8 miles inland from the Pacific Coast of Central California. The city of 150,000 is well 

known as the home of the author John Steinbeck and is the hub of the valley’s 

agricultural industry. Utility services are provided by Pacific Gas & Electric (PG&E), 

which is an investor-owned utility and is regulated by the California Public Utilities 

Commission. 

Under the RE-Powering America’s Land initiative, the U.S. Environmental Protection 

Agency (EPA) provided funding to the National Renewable Energy Laboratory (NREL) 

to support a feasibility study of solar renewable energy generation at the Crazy Horse 

Landfill in Salinas, California. The site is approximately 160 acres and is located in

northern Monterey County 5 miles northeast of the city. The site operated as a landfill

and was in operation from 1934–2009. Ownership of the landfill started with a private 

owner, then the City of Salinas, and currently the Salinas Valley Solid Waste Authority 

(SVSWA). 

The Crazy Horse Landfill stopped accepting waste and was closed to the public in 

May 2009. Approximately 6 acres of the landfill were closed in 1988 and covered with a 

high-density, polyethylene membrane and 2 feet of soil. The site is complemented with a 

water treatment system in an attempt to stabilize the groundwater contamination. Six 

extraction wells were initially installed as an interim measure, followed by the 

installation of 17 additional wells to completely capture the migrating plume. Adjacent 

residential wells were either permanently sealed or converted into extraction or 

monitoring wells. Contaminated water was pumped from the extraction wells and treated 

by air stripping. Treated water is stored in collection tanks and then either re-injected into 

the ground through 27 recharge wells or used for dust control.2

 

The remaining portion of the landfill is now capped with a geomembrane/artificial turf

cover system or paved with asphalt/concrete. The full capacity of the current electrical 

distribution lines to the property are likely to be used by the proposed landfill gas 

generator and/or exceeded by a 3.5-MW solar generation project. PG&E has already 

completed a study for the proposed 5-MW landfill gas generation plant, which listed the 

Prunedale substation (approximately 3.36 miles distant) as the interconnection point and 

the estimated cost for interconnection at $4.8 million. The study indicated that no other 

interconnection point was listed for consideration by applicant but it is assumed that the 

Prunedale substation was the most viable location at the time of the study. There are 

possible plans by PG&E to build a switching station close to Crazy Horse Landfill 

(CHL), but it is unknown if an interconnection could be made there with the hope of a 

lower interconnection cost. 

The site is currently undergoing closure construction and is owned and operated by the

SVSWA. The landfill is currently listed as an EPA Superfund site. Pumps are operated 

on-site to contain and remediate plumes emanating from the landfill. Due to the nature of 

 

2

http://yosemite.epa.gov/r9/sfund/r9sfdocw.nsf/vwsoalphabetic/Crazy+Horse+Sanitary+Landfill?OpenDoc

ument. 
2 

the site and closure system (i.e., closure turf), any system installation at the site should 

not penetrate the surface of the landfill. Any system design must be submitted by a civil 

engineer and approved by the State of California. Some modifications to the liner system 

could be made, if necessary.

Feasibility assessment team members from NREL, the SVSWA, and EPA conducted a 

site assessment visit on February 2, 2012, to gather information integral to this economic 

feasibility study. Information, including solar resource, transmission availability, 

community acceptance, and ground conditions, were considered. 
3 

2 Development of a Photovoltaic System 

on Landfills

One very promising and innovative use of contaminated sites is to install solar 

photovoltaic (PV) systems. PV systems can be ground-mounted, and these types of 

systems work well on landfill sites where there are commonly large un-shaded areas. 

Because of development restrictions placed on the site due to the remediation efforts, PV 

can often represent the highest and best use feasible, generating significant revenue on a 

site that would otherwise go unused. 

The Crazy Horse Landfill is owned by SVSWA, which is interested in potential revenue 

flows from the site. Understanding opportunities studied and realized by other similar 

sites demonstrates the potential for PV system development. PV systems on landfill sites 

have been successful at other EPA cleanup sites, such as the 2-MW plant at Fort Carson, 

Colorado, which uses thin-film PV modules on 15 acres of a decommissioned landfill. 

Also, the Hickory Ridge Landfill near Atlanta, Georgia, uses an integrated thin-film PV

landfill cap to generate 1 MW of power. 

The SVSWA is also exploring options to create electricity from its landfill gas (LFG). 

The generation from a 3.2-MW LFG system could commence within a short timeframe as 

LFG collection lines are already in place and a similar system was operated on the site for 

a number of years. Although LFG appears to be a good possibility for the site during its 

remaining years of LFG production, this report focuses on PV as a longer-term energy 

generator and revenue producer for the site. 

Most states rely heavily on fossil fuels to operate their power plants. There are many 

compelling reasons to consider moving toward renewable energy sources for power 

generation instead of fossil fuels, including: 

• Using fossil fuels to produce power might not be sustainable 

• Burning fossil fuels can have negative effects on human health and the 

environment 

• Extracting and transporting fossil fuels can lead to accidental spills, which can be 

devastating to the environment and communities 

• Depending on foreign sources of fossil fuels can be a threat to national security

• Fluctuating electric costs are associated with fossil-fuel-based power plants 

• Burning fossil fuels may contribute to climate change

• Generating energy without harmful emissions or waste products can be 

accomplished through renewable energy sources

• Obtaining a long-term, stable, and predictable energy cost for remediation 

operations if SVSWA chooses to buy the solar power or own the system. 
4 

3 PV Systems

3.1 PV Overview

Solar PV technology converts energy from solar radiation directly into electricity. Solar 

PV cells are the electricity-generating component of a solar energy system. When 

sunlight (photons) strikes a PV cell, an electric current is produced by stimulating 

electrons (negative charges) in a layer in the cell designed to give up electrons easily. The 

existing electric field in the solar cell pulls these electrons to another layer. By 

connecting the cell to an external load, this current (movement of charges) can then be 

used to power the load (e.g., light bulb). 

Figure 1. Generation of electricity from a PV cell

Source: EPA

PV cells are assembled into a PV panel or module. PV modules are then connected to 

create an array. The modules are connected in series and then in parallel as needed to 

reach the specific voltage and current requirements for the array. The direct current (DC) 

electricity generated by the array is then converted by an inverter to useable alternating 

current (AC) that can be consumed by adjoining buildings and facilities or exported to the 

electricity grid. PV system size varies from small residential (2–10 kW), to commercial 

(100–500 kW), to large utility scale (10+ MW). Central distribution plants are also 

currently being built in the 100+ MW scale. Electricity from utility-scale systems is 

commonly sold back to the electricity grid. 

(-)

(+)

-

- -

-

Electron

Current flow

-

Solar cell

- - -

Load
5 

3.2 Major System Components

Figure 2. Ground-mounted array diagram

Source: NREL

A typical PV system is made up of several key components, including: 

• PV modules 

• Inverter

• Balance-of-system (BOS) components. 

These, along with other PV system components, are discussed below. 

3.2.1 PV Module

Module technologies are differentiated by the type of PV material used, resulting in a 

range of conversion efficiencies from light energy to electrical energy. The module 

efficiency is a measure of the percentage of solar energy converted into electricity. 

Two common PV technologies that have been widely used for commercial- and utilityscale projects are crystalline silicon and thin film. 

3.2.1.1 Crystalline Silicon

Traditional solar cells are made from silicon. Silicon is quite abundant and nontoxic. It 

builds on a strong industry on both supply (silicon industry) and product side. This 

technology has been demonstrated for a consistent and high efficiency over 30 years in 

the field. The performance degradation, a reduction in power generation due to long-term 

exposure, is under 1% per year. Silicon modules have a lifespan range of 25–30 years but 

can keep producing energy beyond this range. 
6 

Typical overall efficiency of silicon solar panels is between 12% and 18%. However, 

some manufacturers of mono-crystalline panels claim an overall efficiency nearing 20%. 

This range of efficiencies represents significant variation among the crystalline silicon 

technologies available. The technology is generally divided into mono- and polycrystalline technologies, which indicates the presence of grain-boundaries (i.e., multiple 

crystals) in the cell materials and is controlled by raw material selection and 

manufacturing technique. Crystalline silicon panels are widely used based on 

deployments worldwide. 

Figure 3 shows two examples of crystalline solar panels: mono-crystalline and polycrystalline silicon installed on tracking mounting systems.

Figure 3. Mono- and poly-crystalline solar panels. Photos by (left) SunPower Corporation, 

NREL 23816 and (right) SunPower, NREL 13823

3.2.1.2 Thin Film

Thin-film PV cells are made from amorphous silicon (a-Si) or non-silicon materials, such 

as cadmium telluride (CdTe). Thin-film cells use layers of semiconductor materials only 

a few micrometers thick. Due to the unique nature of thin films, some thin-film cells are 

constructed into flexible modules, enabling such applications as solar energy covers for 

landfills, such as a geomembrane system. Other thin-film modules are assembled into 

rigid constructions that can be used in fixed-tilt or, in some cases, tracking system 

configurations. 

The efficiency of thin-film solar cells is generally lower than for crystalline cells. Current 

overall efficiency of a thin-film panel is between 6% and 8% for a-Si and 11% and 12% 

for CdTe. Figure 4 shows thin-film solar panels.

 

Figure 4. Thin-film solar panels installed on (left) solar energy cover and (middle/right) 

fixed-tilt mounting system. Photos by Republic Services, Inc., NREL 23817, (middle) Beck 

Energy, NREL 14726, and (right) U.S. Coast Guard Petaluma Site, NREL 17395
7 

Industry standard warranties of both crystalline and thin-film PV panels typically 

guarantee system performance of 80% of the rated power output for 25 years. After 

25 years, they will continue producing electricity at a lower performance level.

3.2.2 Inverter

Inverters convert DC electricity from the PV array into AC and can connect seamlessly to 

the electricity grid. Inverter efficiencies can be as high as 98.5%. 

Inverters also sense the utility power frequency and synchronize the PV-produced power 

to that frequency. When utility power is not present, the inverter will stop producing AC 

power to prevent “islanding” or putting power into the grid while utility workers are 

trying to fix what they assume is a de-energized distribution system. This safety feature is 

built into all grid-connected inverters in the market. Electricity produced from the system 

may be fed to a step-up transformer to increase the voltage to match the grid. 

There are two primary types of inverters for grid-connected systems: string and microinverters. Each type has strengths and weaknesses and might be recommended for 

different types of installations.

String inverters are most common and typically range in size from 1.5–1,000 kW. These 

inverters tend to be cheaper on a capacity basis, as well as have high efficiency and lower 

operation and maintenance (O&M) costs. String inverters offer various sizes and 

capacities to handle a large range of voltage output. For larger systems, string inverters 

are combined in parallel to produce a single point of interconnection with the grid. 

Warranties typically run between 5 and 10 years with 10 years being the current industry 

standard. On larger units, extended warranties up to 20 years are possible. Given that the 

expected life of the PV panels is 25–30 years, an operator can expect to replace a string

inverter at least one time during the life of the PV system. 

Micro-inverters are dedicated to the conversion of a single PV module’s power output. 

The AC output from each module is connected in parallel to create the array. This 

technology is relatively new to the market and in limited use in larger systems due to 

potential increase in O&M associated with significantly increasing the number of 

inverters in a given array. Current micro-inverters range in size between 175 W and 

380 W. These inverters can be the most expensive option per watt of capacity. Warranties 

range from 10–20 years. Small projects with irregular modules and shading issues 

typically benefit from micro-inverters. 

With string inverters, small amounts of shading on a solar panel will significantly affect 

the entire array production. Instead, it impacts only that shaded panel if micro-inverters 

are used. Figure 5 shows a string inverter. 
8 

Figure 5. String inverter. Photo by Warren Gretz, NREL 07985

3.2.3 Balance-of-System Components

In addition to the solar modules and inverter, a solar PV system consists of other parts 

called BOS components, which include: 

• Mounting racks and hardware for the panels 

• Wiring for electrical connections. 

3.2.3.1 Mounting Systems

The array has to be secured and oriented optimally to maximize system output. The 

structure holding the modules is referred to as the mounting system. 

3.2.3.1.1 Ground-Mounted Systems

For ground-mounted systems, the mounting system can be either directly anchored into 

the ground (via driven piers or concrete footers) or ballasted on the surface without 

ground penetration. Mounting systems must withstand local wind loads, which range 

from 90–120 mph for most areas or 130 mph or more for areas with hurricane potential. 

Depending on the region, snow and ice loads must also be a design consideration for the 

mounting system. For brownfield applications, mounting system designs will be 

primarily driven by these considerations coupled with settlement concerns. 

Typical ground-mounted systems can be categorized as fixed tilt or tracking. Fixed-tilt 

mounting structures consist of panels installed at a set angle, typically based on site 

latitude and wind conditions, to increase exposure to solar radiation throughout the year. 

Fixed-tilt systems are used at many brownfield sites. Fixed-tilt systems have lower 

maintenance costs but generate less energy (kWh) per unit power (kW) of capacity than 

tracking systems. 

Tracking systems rotate the PV modules so they are following the sun as it moves across 

the sky. This increases energy output but also increases maintenance and equipment costs 

slightly. Single-axis tracking, in which PV is rotated on a single axis, can increase energy 

output up to 25% or more. With dual-axis tracking, PV is able to directly face the sun all 

day, potentially increasing output up to 35% or more. Depending on underlying soiling 

conditions, single- and dual-axis trackers may not be suitable due to potential settlement 

effects, which can interfere with the alignment requirements of such systems. 
9 

Table 1. Energy Density by Panel and System

System Type Fixed-Tilt Energy Density 

(DC-Watts/ft2

) 

Single-Axis Tracking 

Energy Density

(DC-Watts/ft2

) 

Crystalline Silicon 4.0 3.3

Thin Film 3.3 2.7

Hybrid High 

Efficiency

4.8 3.9

The selection of mounting type is dependent on many factors, including installation size, 

electricity rates, government incentives, land constraints, latitude, and local weather. 

Contaminated land applications may raise additional design considerations due to site 

conditions, including differential settlement. 

Selection of the mounting system is also heavily dependent on anchoring or foundation 

selection. The mounting system design will also need to meet applicable local building 

code requirements with respect to snow, wind, and seismic zones. Selection of mounting 

types should also consider frost protection needs, especially in cold regions, such as 

New England. 

3.2.3.2 Wiring for Electrical Connections

Electrical connections, including wiring, disconnect switches, fuses, and breakers, are 

required to meet electrical code (e.g., NEC Article 690) for both safety and equipment 

protection. 

In most traditional applications, wiring from (1) the arrays to inverters and (2) inverters 

to point of interconnection is generally run as direct burial through trenches. In 

brownfield applications, this wiring may be required to run through above-ground 

conduit due to restrictions with cap penetration or other concerns. Therefore, developers 

should consider noting any such restrictions, if applicable, in requests for proposals in 

order to improve overall bid accuracy. Similarly, it is recommended that PV system 

vendors reflect these costs in the quote when costing out the overall system.

3.2.3.3 PV System Monitoring 

Monitoring PV systems can be essential for reliable functioning and maximum yield of a 

system. It can be as simple as reading values such as produced AC power, daily kilowatthours, and cumulative kilowatt-hours locally on an LCD display on the inverter. For 

more sophisticated monitoring and control purposes, environmental data, such as module 

temperature, ambient temperature, solar radiation, and wind speed, can be collected. 

Remote control and monitoring can be performed by various remote connections. 

Systems can send alerts and status messages to the control center or user. Data can be 

stored in the inverter’s memory or in external data loggers for further system analysis. 

Collection of this basic information is standard for solar systems and not unique to 

landfill applications.
10 

Weather stations are typically installed in large-scale systems. Weather data, such as solar 

radiation and temperature, can be used to predict energy production, enabling comparison 

of the target and actual system output and performance and identification of underperforming arrays. Operators may also use this data to identify required maintenance, 

shade on panels, and accumulating dirt on panels, for example. Monitoring system data 

can also be used for outreach and education. This can be achieved with publicly 

available, online displays; wall-mounted systems; or even smart phone applications. 

3.2.4 Operation and Maintenance

PV panels typically have a 25-year performance warranty. Inverters, which come 

standard with a 5-year or 10-year warranty (extended warranties available), would be 

expected to last 10–15 years. System performance should be verified on a vendorprovided website. Wire and rack connections should be checked annually. This economic 

analysis uses an annual O&M cost computed as $20/kW/yr, which is based on the 

historical O&M costs of installed fixed-axis, grid-tied PV systems. In addition, the 

system should expect a replacement of system inverters in year 15 at a cost of $0.25/W. 

3.3 Siting Considerations

PV modules are very sensitive to shading. When shaded (either partially or fully), the 

panel is unable to optimally collect the high-energy beam radiation from the sun. As 

explained above, PV modules are made up of many individual cells that all produce a 

small amount of current and voltage. These individual cells are connected in series to 

produce a larger current. If an individual cell is shaded, it acts as resistance to the whole 

series circuit, impeding current flow and dissipating power rather than producing it. 

The NREL solar assessment team uses a Solmetric SunEye solar path calculator to assess 

shading at particular locations by analyzing the sky view where solar panels will be 

located. By finding the solar access, the NREL team can determine if the area is 

appropriate for solar panels. 

Following the successful collection of solar resource data using the Solmetric SunEye 

tool and determination that the site is adequate for a solar installation, an analysis to 

determine the ideal system size must be conducted. System size depends highly on the 

average energy use of the facilities on the site, power purchase agreements (PPAs), 

incentives available, and utility policy. 
11 

4 Proposed Installation Location Information

This section summarizes the findings of the NREL solar assessment site visit on

February 2, 2012. 

4.1 Crazy Horse Landfill Site PV System

As discussed in Section 1, the Crazy Horse Landfill site is managed by SVSWA. The site 

is 160 acres, with about 25 acres suitable for PV on the crown of the landfill. It is 

assumed that 80% of this (i.e., 20 acres) will be usable for PV after factoring, roads, LFG

collection lines, and perimeter clearance. Figure 6 shows various views of the Crazy 

Horse Landfill site. As shown, there are large expanses of relatively flat (5% slope and 

under), un-shaded land, which makes it a suitable candidate for a PV system.

Figure 6. Views of the feasible area for PV at the Crazy Horse Landfill. Photos by Blaise 

Stoltenberg, NREL

4.2 Utility-Resource Considerations

There are two possible options for the electrical tie-in point for the PV system at the 

Crazy Horse Landfill site. The most likely option for interconnection is PG&E’s 

Prunedale 1107 distribution circuit approximately 3.5 miles to the southwest of the 

landfill. It appears the existing circuits are at capacity and new transmission will need to 
12 

be built to accommodate the solar generation. The other option is a proposed switching 

station that could be approximately 2 miles away reducing the costs associated with 

building transmission from the PV site to the interconnection point. In 2011, a PG&E

system impact study3 was completed for a 5-MW LFG generator that estimated a 

$4.8 million total cost for transmission network upgrades, which is assumed to be a good 

proxy for the cost of a PV system interconnection unless the cost can be shared with 

another project. A more recent inquiry regarding a 3.2-MW LFG generator indicated that 

the interconnection costs would be higher than the $4.8 million calculated in the 

PG&E study.

The inverters and other power electronics (e.g., transformers) are likely to be placed near 

the solar panels under a canopy to shade from direct sunlight to reduce their temperature 

and increase efficiency and lifetime. 

4.3 Feasible PV System Installation Area

PV arrays must be installed in un-shaded locations on the ground or on building roofs 

that have an expected life of at least 25 years. 

Figure 7 shows an aerial view of the Crazy Horse Landfill site, and the feasible area for 

PV is shaded in orange. As shown, there is one relatively large area at the Crazy Horse 

Landfill site that is feasible for PV, which has an area of approximately 20 acres. 

 

3 “System Impact Study Generator Interconnection: Small Generator Interconnection Procedures.” Salinas, 

CA: AMERESCO Crazy Horse LLC, May 2011. 
13 

Figure 7. Aerial view of the feasible area (orange) for PV at the Crazy Horse Landfill site

Credit: Google Earth

4.4 PV Site Solar Resource

The Crazy Horse Landfill site has been evaluated to determine the adequacy of the solar 

resource available using both on-site data and industry tools. 

The assessment team for this feasibility study did not identify any shading obstructions 

on the recommended site and, therefore, found a solar access of 100%. 

The predicted array performance was found using PVWatts Version 2 for Salinas, 

California.

4 Table 2 shows the station identification information, PV system 

specifications, and energy specifications for the site. For this summary array performance 

information, a hypothetical system size of 1 kW was used, allowing for clear inclusion in 

detailed economic analysis later in this report. 

 

4 PVWatts is a performance calculator for grid-connected PV systems. It was created by NREL’s 

Renewable Resources Data Center. For more information, see http://www.nrel.gov/rredc/pvwatts/grid.html. 
14 

Table 2. Site Identification Information and Specifications

Station Identification

Cell ID 173350

State California 

Latitude 36.7°N

Longitude 121.8°W

PV System Specifications

DC Rating 1.00 kW

Derate Factor 0.8

AC Rating 0.80 kW

Array Type Fixed Tilt 

Array Tilt 20.0°

Array Azimuth 180.0°

Table 3 shows the performance results for a 1-kW, 20-degree fixed-tilt PV system in 

Salinas, California, as calculated by PVWatts Version 2. 

Table 3. Performance Results for 1-kW, 20-Degree Fixed-Tilt PV

Month

 

Solar

Radiation

(kWh/m2

/day)

AC

Energy

(kWh)

1 3.54 82 

2 4.55 97 

3 5.18 122

4 6.40 145 

5 6.72 160 

6 6.97 158 

7 6.75 157

8 6.38 149 

9 6.05 135 

10 4.87 112 

11 3.96 88

12 3.34 77 

Year 5.40 1,481 

. 
15 

4.5 Crazy Horse Landfill Energy Usage

The Crazy Horse Landfill site has a remediation system to capture contaminated ground 

water. The pumps used for remediation, recharging, and dust control likely use the 

majority of power presently consumed on-site. 

4.5.1 Current Energy Use

The site has three different PG&E meters. Two of the meters are on the A1 Small 

General Service rate and record no or very low energy consumption. The other meter 

records considerably higher usage (22,880 kWh in May 2012) and is on the A10S 

Medium General Demand-Metered Service rate. It is recommended that the electricity 

from the system be sold directly to the utility, making the on-site consumption irrelevant. 

The current market price referrals in California are around $120/MWh, so it is expected 

that the PPA rate would be in a similar range. The majority of the energy use—

364,188 kWh annually—is for the operation of the remediation pumps as well as the 

buildings on-site, specifically the gas recycling facility. The average utility rate given in 

the application is $0.17/kWh. Table 4 lists the meters, rate schedule, and consumption. 

Table 4 . Meters and Rate Schedules

Meter ID

Rate

Schedule

Total Annual Energy 

Consumption

(kWh)

May 2012 Energy 

Consumption

(kWh)

1009552593 A1-SG Not available 0 

1009552591 A1-SG Not available 72

23675 A10SMGDM Not available 22,880 

Table 5. PG&E A-1 Rate Schedule

Rate 

Schedule

Customer 

Charge Season

Timeof-Use 

Period

Demand Charge 

(per kW)

Timeof-Use 

Period

Total Energy 

Charge 

(per kWh)

A-1 Single 

Phase 

Service per 

meter/day =

$0.32854 

Polyphase 

Service per 

meter/day =

$0.65708

Summer - $0.20522

Winter - $0.14493
16 

Table 6. PG&E A-10 Rate Schedules

Rate Schedule Customer 

Charge

Optional 

Meter 

Data 

Access 

Charge

Season

Demand 

Charge 

(per kW)

Time-ofUse Period

Energy 

Charges 

(per kWh)

 PDP1/

Charges

PDP2/ Credits 

DEMAND 

(per kW)

PDP2/ Credits 

ENERGY 

(per kWh)

"Average" 

Total Rate3/ 

(per kWh)

A-10 

TOU Secondary (Table B) Customers with high 

electric use and medium 

to high load factors 

generally benefit under 

Schedule A-10 TOU. Part 

of customer's bill varies 

according to the 

customer's maximum 

monthly electric demand.

$4.59959 

per meter 

per day 

$0.98563 

per meter 

per day 

Summer $12.15

Peak $0.15130 

$0.90 

($2.11)

($0.00875)

$0.15974 

Part-Peak $0.14543 ($0.00875)

Off-Peak $0.12759 ($0.00875)

Winter $5.63 

Part-Peak $0.11116 

- - Off-Peak $0.09586 

A-10 

TOU Primary 

(Table B) Customers with high 

electric use and medium 

to high load factors 

generally benefit under 

Schedule A-10 TOU. Part 

of customer's bill varies 

according to the 

customer's maximum 

monthly electric demand.

Summer $11.38

Peak $0.14026 

$0.90 

($1.99)

($0.00899)

$0.14847 

Part-Peak $0.13607 ($0.00899)

Off-Peak $0.12008 ($0.00899)

Winter $5.84 

Part-Peak $0.10545 

- - Off-Peak $0.09293 

A-10 

TOU Transmission (Table B) Customers with high 

electric use and medium 

to high load factors 

generally benefit under 

Schedule A-10 TOU. Part 

of customer's bill varies 

according to the 

customer's maximum 

monthly electric demand.

Summer $7.47

Peak $0.11521 

$0.90 

($2.23)

($0.00648)

$0.12227 

Part-Peak $0.11139 ($0.00648)

Off-Peak $0.09686 ($0.00648)

Winter $4.13 

Part-Peak $0.09260 

- - Off-Peak $0.08108 
17 

4.5.2 Net Metering

Net metering is an electricity policy for consumers who own renewable energy facilities. 

"Net," in this context, is used to mean "what remains after deductions"—in this case, the 

deduction of any energy outflows from metered energy inflows. Under net metering, a 

system owner receives retail credit for at least a portion of the electricity it generates. As 

part of the Energy Policy Act of 2005,

5

 under Sec. 1251, all public electric utilities are 

required upon request to make net metering available to their customers:

(11) NET METERING.—Each electric utility shall make available upon 

request net metering service to any electric consumer that the electric 

utility serves. For purposes of this paragraph, the term ‘net metering 

service’ means service to an electric consumer under which electric energy 

generated by that electric consumer from an eligible on-site generating 

facility and delivered to the local distribution facilities may be used to 

offset electric energy provided by the electric utility to the electric 

consumer during the applicable billing period.6

California's net-metering law,7 which took effect in 1996, requires utilities to offer net 

metering to all customers with solar and wind-energy systems up to 1 MW. The portion 

of the Crazy Horse Landfill system in excess of 1 MW will therefore be ineligible for net 

metering. Also, the estimated annual production from a 3.5-MW system located at the 

site would be much larger than site consumption (5.2 million kWh produced compared to 

364,000 kWh consumed). 

Renewable energy certificates (RECs),

8 also known as green certificates, green tags, or 

tradable renewable certificates, are tradable commodities in the United States that 

represent proof of electric energy generation from eligible renewable energy resources 

(renewable electricity). The RECs that are associated with the electricity produced and 

are used on-site remain with the customer-generator. If, however, the customer chooses 

to receive financial compensation for the net-energy generated (NEG) remaining after a 

12-month period, the utility will be granted the RECs associated with only that surplus 

they purchase. 

California does not allow any new or additional demand charges, standby charges, 

customer charges, minimum monthly charges, interconnection charges, or other charges 

that would increase an eligible customer-generator's costs beyond those of other 

customers in the rate class to which the eligible customer-generator would otherwise be 

assigned. The California Public Utility Commission has explicitly ruled that technologies 

eligible for net metering (up to 1 MW) are exempt from interconnection application fees, 

as well as from initial and supplemental interconnection review fees. 

 

5 For the full text of this bill see, http://www.gpo.gov/fdsys/pkg/PLAW-109publ58/pdf/PLAW109publ58.pdf. 6 Adopted by the Energy Policy Act of 2005 on page370, Subtitle E – Amendments to PURPA. 7 For more information about California's net-metering law, see http://www.dsireusa.org/incentives/

incentive.cfm?Incentive_Code=CA02R&re=1&ee=1. 8 For a description of RECs, see http://apps3.eere.energy.gov/greenpower/markets/

certificates.shtml. 
18 

Publicly owned utilities may elect to provide co-energy metering, which is the same as 

net metering except that it incorporates a time-of-use (TOU) rate schedule. Customergenerators with systems sized between 10 kW and 1 MW, who are subject to TOU rates, 

are entitled to return electricity to the system for the same TOU (including real-time) 

price that they pay for power purchases. However, TOU customers who choose to coenergy meter must pay for the metering equipment capable of making such 

measurements. Customer-generators retain ownership of all RECs associated with the 

generation of electricity they use on-site. 

4.5.3 Virtual Net Metering

Some states and utilities allow for virtual net metering (VNM). This arrangement can 

allow certain entities, such as a local government, to install renewable generation of up to 

1 MW at one location within its geographic boundary and to generate credits that can be 

used to offset charges at one or more other locations within the same geographic 

boundary. California Assembly Bill 2466 (AB 2466),9 codified as Section 2830 of the 

Public Utilities Code, was signed into law by Governor Schwarzenegger in September 

2008 and became effective on January 1, 2009.10

The California State Legislature defined local government to include cities, counties, 

school districts, special districts, political subdivisions, or other local public agencies that 

are authorized to generate electricity. The legislature decided that the tariff would not be 

available for the state, any agency or department of the state, or any joint powers 

authority. This law could be used to offset power use at other SVSWA sites if needed but 

is also subject to the 1-MW maximum and, therefore, may not be feasible for the site. If a 

deal could be structured into two systems at the same site, up to 1 MW of the PV could 

be used for net metering and/or VNM while the rest would probably be a PPA with 

PG&E or another offtaker. 

 

9 California Legislature. Assembly Bill No. 2466. (Apr. 28, 2010). Accessed May 1, 2012: 

http://www.leginfo.ca.gov/pub/09-10/bill/asm/ab_2451-2500/ab_2466_bill_20100428_amended_asm_

v98.pdf. 10 For more information about VNM, see http://www.pge.com/b2b/newgenerator/ab2466/. 
19 

5 Economics and Performance

5.1 Assumptions and Input Data for Analysis

For this analysis, the following input data were used. The installed cost (i.e., all costs of a 

system except land cost and extraordinary interconnection cost) of a fixed-tilt groundmounted system was assumed to be a range from $2.79/W–$3.20/W,

11 and the installed 

cost of a single-axis tracking system was assumed to be $3.35/W–$3.84/W. Single-axis 

tracking is not recommended for a landfill site with potential settling of the ground. The 

estimated increase in cost from this baseline for a ballasted system is 25%, bringing the 

assumed installed cost of a ground-mounted fixed-tilt ballasted system to $3.49/W–

$4.00/W. A ballasted system is recommended due to the unique nature of the landfill site 

and the necessity for being able to easily adjust the ground-mounted racking system. 

These prices include the PV array and the BOS components for each system, including 

the inverter and electrical equipment, as well as the installation cost. The economics of 

grid-tied PV depend on incentives, the cost of electricity, the solar resource, and panel tilt 

and orientation. For this analysis, the cost of electricity was assumed to be $0.17/kWh, as 

reported by the State of California, based on electric bills for the site.

12

A system derating of 80% was assumed. This included inverter losses, wire losses, PV 

module losses, and losses due to temperature effects. The System Advisor Model (SAM) 

and PVWatts Version 2 were both used to calculate energy performance. 

It was assumed for this analysis that federal incentives are received. It is important to find 

incentives or grants to make PV cost effective. If the PV system is owned by a private 

tax-paying entity, this entity may qualify for federal tax credits and accelerated 

depreciation on the PV system. The total potential tax benefits to the tax-paying entity 

can be as high as 45% of the system cost. Because the state and federal governments do 

not pay taxes, private ownership of the PV system would be required to capture 

tax incentives. 

Table 7 shows the technical and financial assumptions made for the included analysis. 

There were two primary financial structures considered: third-party ownership (PPA) and 

non-taxable entity owned (i.e., SVSWA). Summary assumptions are in Appendix A. 

 

11 Residential, Commercial, and Utility-Scale Photovoltaic (PV) System Prices in the United States: 

Current Drivers and Cost-Reduction Opportunities. NREL/TP-6A20-53347, February 2012, p.33.

Accessed February 6, 2013: http://www.nrel.gov/docs/fy12osti/53347.pdf. 12 Solar Energy Industries Association “SEIA/GTM Research U.S. Solar Market Insight” 2011 year-end 

report. http://www.seia.org/cs/research/SolarInsight.
20 

Table 7. Financial and Technical Assumptions Used in Analysis

Assumptions

Inputs PPA/Investor

Municipal 

Ownership Notes

TMY3

Salinas Municipal 

Airport 

Salinas Municipal 

Airport 

Utility rate N/A 0.17

Flat buy and sell 

rate with 2% utility 

rate escalation, 

net metering 

enabled

Analysis period 

(years) 25 25

Inflation 2.50% 2.50%

Real discount 

rate 5.85% 3.00%

Federal tax rate 35% 0%

State tax rate 8% 0%

Insurance (% of 

installed cost) 0.50% 0.50%

Property tax 0 0

0% per DSIRE for 

California

Construction 

loan 0 0

Loan term 20 25

Loan rate 6% 4%

Debt fraction 46% 100%

45%–60% PPA, 

100% municipal 

ownership, debt 

service coverage 

ratio of ~1.3 (>1.2)

Minimum internal 

rate of return 15% N/A

PPA escalation 

rate 1.50% N/A

Federal

depreciation

5-year Modified 

accelerated cost 

recovery system

MACRS with 50% 

1st year bonus 

depreciation 

(50%,16%, 19.6%,

5.7%, 6%, 5.76%,

2.88%) None

N/A for municipal 

ownership

State 

depreciation 5-year MACRS None

N/A for municipal 

ownership
21 

Fed investment 

tax credit (ITC) 30% None

N/A for municipal 

ownership

Payment 

incentives None None

Degradation 0.50% 0.50%

Availability 100% 100%

Cost range low - 

landfill ballasted 

per kW $3,490.00 $3,490.00 

Cost range highlandfill ballasted 

per kW $4,000.00 $4,000.00 

Grid 

interconnnection 

cost $ - $ - 

Land cost $ - $ - 

O&M

$30/kW/yr first 15 yrs 

& $20/kW/yr for yrs 

16-25

$30/kW/yr first 15 

yrs & $20/kW/yr for

yrs 16-25

Derate factor 0.8 0.8

Fixed tilt 20° 20°

Single-axis tilt 0° 0°

Acres per MW 

fixed 5.74 5.74

Acres per MW 

tracking 6.96 6.96

5.2 SAM Forecasted Economic Performance

Using the inputs and assumptions summarized in Section 5.1, the SAM tool predicts the 

levelized cost of energy (LCOE), PPA price, and payback period. 

The LCOE in cents per kilowatt-hour accounts for a project's installation, financing, tax, 

and operating costs and the quantity of electricity it produces over its life. The LCOE 

makes it possible to compare alternatives with different project lifetimes and performance 

characteristics. Analysts can use the LCOE to compare the option of installing a 

residential or commercial project to purchasing electricity from an electric service 

provider or to compare utility and commercial PPA projects with investments in energy 

efficiency, other renewable energy projects, or conventional fossil fuel projects. The 

LCOE captures the trade-off between typically higher-capital-cost, lower-operating-cost 

renewable energy projects and lower-capital-cost, higher-operating-cost fossil-fuel-based 

projects. 
22 

The PPA price is the first-year price that electricity could be sold to the property owner 

allowing the developer to own a certain internal rate of return (IRR). For this analysis, the 

required IRR used was 15%, and the first-year PPA price escalates at 1.5% per year.

The payback period is the time in years that it takes for the capital investment to be 

recovered based on the dollar amount of savings. For this analysis, the price of electricity 

is $0.17/kWh with an escalation rate of 2% per year. 

The system economics presented in this analysis are based on many assumptions that 

represent the best information that NREL can reference at the time of the analysis and, 

therefore, should be considered best estimates. Only a firm proposal developed by a solar 

installer or developer will give the true economics of a system. Based on this, there are 

two assumptions that should be addressed specifically. First, no incentives were modeled 

in this economic analysis. Even though there appears to be no incentives presently 

available in California, it is highly likely there will be more in the future that will 

improve system economics. Second, system cost is based on published data with 

adjustments for tracking and landfill applications based on industry research. Costs in the 

solar industry are changing more rapidly than the availability of published data; therefore, 

the proposed system cost from a solar developer might be considerably less than 

calculated in this report and could greatly improve system economics. 

SAM results are available in Appendix B. A summary of the results of the economic 

analysis and the system considered is shown in Table 8. 

Table 8. Crazy Horse Landfill Site Summary

Financing

PV 

System 

Sizea

Net Annual 

Output

Annual 

O&M

LCOE Real 

Low b

LCOE Real 

High c

PPA Price 

Low b

PPA Price 

High c

Payback 

Period 

Low b

Payback 

Period 

High c

Jobs 

Created d

Jobs 

Sustained e

(kW) (kWh/year) ($/year) ($/kWh) ($/kWh) ($/kWh) ($/kWh) (years) (years) (job-year) (job-year)

PPA/ 

Investor 0.139 0.156 0.155 0.175 n/a n/a 

Municipal 

Ownership 0.147 0.166 n/a n/a 12.7 14.2

a

 Data assume a maximum usable area of 20 acres and 5.74 acres/MW

b

 "Low" is low end of installed cost range: $3.49/Watt

c

 "High" is the high end of the installed cost range: $4.00/Watt

d

 Job-years created as a result of project capital investment including direct, indirect, and induced jobs.

e

 Jobs (direct, indirect, and induced) sustained as a result of operations and maintenance (O&M) of the system.

n/a: not applicable

3,500 5,253,204

 105,000 

(year 1-15) 

70,000 

(year 16-25) 

103 1.3

5.3 Job Analysis and Impact

To evaluate the impact on employment and economic impacts of the PV project 

associated with this analysis, the NREL Jobs and Economic Development Impact (JEDI) 

models are used.

13 JEDI estimates the economic impacts associated with the construction 

 

13 The JEDI models have been used by the U.S. Department of Energy, the U.S. Department of Agriculture, 

NREL, and the Lawrence Berkeley National Laboratory, as well as a number of universities. For 

information on JEDI, see http://www.nrel.gov/analysis/jedi/about_jedi.html.
23 

and operation of distributed generation power plants. JEDI is a flexible input-output tool 

that estimates, but does not precisely predict, the number of jobs and economic impacts 

that can be reasonably support by the proposed facility. 

JEDI represents the entire economy, including cross-industry or cross-company impacts. 

For example, JEDI estimates the impact that the installation of a distributed generation 

facility would have on not only the manufacturers of PV modules and inverters but also 

the associated construction materials, metal fabrication industry, project management 

support, transportation, and other industries that are required to enable the procurement 

and installation of the complete system. 

For this analysis, inputs, including the estimated installed project cost ($/kW), year of 

construction, system capacity (kW), O&M costs ($/kW), and location, were entered into 

the model to predict the jobs and economic impact. It is important to note that JEDI does 

not predict or incorporate any displacement of related economic activity or alternative 

jobs due to the implementation of the proposed project. As such, the JEDI results are 

considered gross estimates as opposed to net estimates. 

For the Crazy Horse Landfill site, the following values were assumed: 

• Capacity: 3.5 MW

• Placed in service year: 2013 

• Installed system cost: $13,707,678 

• Location: California. 

Using these inputs, JEDI estimated the gross direct and indirect jobs, associated earnings, 

and total economic impact supported by the construction and continued operation of the 

proposed PV system. 

The estimates of jobs associated with this project are presented as either construction 

period jobs or sustained operations jobs. Each job is expressed as a whole, or fraction, 

full-time equivalent (FTE) position. An FTE is defined as full-time employment for one 

person for the duration of a year. Construction period jobs are considered short-term 

positions that exist only during the procurement and construction periods (i.e., typically 

12–18 months). 

As indicated in the results of the JEDI analysis provided in Appendix C, the total 

proposed system is estimated to support 103 direct and indirect jobs per year for the 

duration of the procurement and construction period. Total wages paid to workers during 

the construction period are estimated to be $5.4 million, and total economic output is 

estimated to be $13.7 million. The annual O&M of the new PV system is estimated to 

support 1.3 FTEs per year for the life of the system. The jobs and associated spending are 

projected to account for approximately $76,000 in earnings and $140,000 in economic 

activity each year for the next 25 years. 
24 

5.4 Financing Opportunities

The procurement, development, construction, and management of a successful utilityscale distributed generation facility can be owned and financed a number of different 

ways. The most common ownership and financing structures are described below. 

5.4.1 Owner and Operator Financing

The owner/operator financing structure is characterized by a single entity with the 

financial strength to fund all of the solar project costs and, if a private entity, sufficient 

tax appetite to utilize all of the project’s tax benefits. Private owners/operators typically 

establish a special purpose entity (SPE) that solely owns the assets of the project. An 

initial equity investment into the SPE is funded by the private entity using existing funds, 

and all of the project’s cash flows and tax benefits are utilized by the entity. This equity 

investment is typically matched with debt financing for the majority of the project costs. 

Project debt is typically issued as a loan based on each owner’s/operator’s assets and 

equity in the project. In addition, private entities can utilize any of federal tax 

credits offered. 

For public entities that choose to finance, own, and operate a solar project, funding can be 

raised as part of a larger, general obligation bond; as a standalone tax credit bond; 

through a tax-exempt lease structure, bank financing, grant and incentive program, or 

internal cash; or some combination of the above. Certain structures are more common 

than others and grant programs for solar programs are on the decline. Regardless, as taxexempt entities, public entities are unable to benefit directly from the various tax-creditbased incentives available to private companies. This has given way to the now common 

use of third-party financing structures such as the PPA. 

5.4.2 Third-Party Developers with Power Purchase Agreements 

Because many project site hosts do not have the financial or technical capabilities to 

develop a capital intensive project, many times they turn to third-party developers (and/or 

their investors). In exchange for access to a site through a lease or easement arrangement, 

third-party developers will finance, develop, own, and operate solar projects utilizing 

their own expertise and sources of tax equity financing and debt capital. Once the system 

is installed, the third-party developer will sell the electricity to the site host or local utility 

via a PPA. The PPA typically will be between the third-party developer and the site host 

if it is a retail (behind the meter) transaction or directly with an electric utility if it is a 

wholesale transaction. 

Site hosts benefit by either receiving competitively priced electricity from the project via 

the PPA or land-lease revenues for making the site available to the solar developer via a 

lease payment. This lease payment can take on the form of either a revenue-sharing 

agreement or an annual lease payment. In addition, third-party developers are able to 

utilize federal tax credits. For public entities, this arrangement allows them to utilize the 

benefits of the tax credits (low PPA price, higher lease payment) while not directly 

receiving them. The term of a PPA typically varies from 20–25 years.
25 

5.4.3 Third-Party “Flip” Agreements

The most common use of this model is a site host working with a third-party developer 

who then partners with a tax-motivated investor in a SPE that would own and operate the 

project. Initially, most of the equity provided to the SPE would come from the tax 

investor and most of the benefit would flow to the tax investor (as much as 99%). When 

the tax investor has fully monetized the tax benefits and achieved an agreed-upon rate of 

return, the allocation of benefits and majority ownership (95%) would “flip” to the site 

host (but not within the first 5 years). After the flip, the site host would have the option to 

buy out all or most of the tax investor’s interest in the project at the fair market value of 

the tax investor’s remaining interest. 

A flip agreement can also be signed between a developer and investors within an SPE, 

where the investors would begin with the majority ownership. Eventually, the ownership 

would flip to the developer once each investor’s return is met.

5.4.4 Hybrid Financial Structures

As the solar market evolves, hybrid financial solutions have been developed in certain 

instances to finance solar projects. A particular structure, nicknamed “The Morris Model” 

after Morris County, New Jersey, combines highly rated public debt, a capital lease, and a 

PPA. Low-interest public debt replaces more costly financing available to the solar 

developer and contributes to a very attractive PPA price for the site hosts. New Markets 

Tax Credits have been combined with PPAs and public debt in other locations, such as 

Denver and Salt Lake City. 

5.4.5 Solar Services Agreement and Operating Lease

The solar services agreement (SSA) and operating lease business models have been 

predominately used in the municipal and cooperative utility markets due to its treatment 

of tax benefits and the rules limiting federal tax benefit transfers from non-profit to forprofit companies. Under IRS guidelines, municipalities cannot enter capital leases with 

for-profit entities when the for-profit entities capture tax incentives. As a result, a number 

of business models have emerged as a workaround to this issue. One model is the SSA,

wherein a private party sells solar services (i.e., energy and RECs) to a municipality over 

a specified contract period (typically long enough for the private party to accrue the tax 

credits). The non-profit utility typically purchases the solar services with either a onetime up-front payment equal to the turn-key system cost minus the 30% federal tax credit 

or may purchase the services in annual installments. The municipality may buy out the 

system once the third party has accrued the tax credits, but due to IRS regulations, the 

buyout of the plant cannot be included as part of the SSA (i.e., the SSA cannot be used as 

a vehicle for a sale and must be a separate transaction).

Similar to the SSA there are a variety of lease options that are available to municipalities 

that allow the capture of tax benefits by third-party owners, which result in a lower cost 

to the municipality. These include an operating lease for solar services (as opposed to an 

equipment capital lease). 
26 

5.4.6 Sale/Leaseback

In the widely accepted sale/leaseback model, the public or private entity would install the 

PV system, sell it to a tax investor, and then lease it back. As the lessee, they would be 

responsible for operating and maintaining the solar system as well as have the right to sell 

or use the power. In exchange for use of the solar system, the public or private entity 

would make lease payments to the tax investor (the lessor). The tax investor would have 

rights to federal tax benefits generated by the project and the lease payments. Sometimes, 

the entity is allowed to buy back the project at 100% fair market value after the tax 

benefits are exhausted. 

5.4.7 Community Solar/Solar Gardens 

The concept of “community solar” is one in which the costs and benefits of one large 

solar project are shared by a number of participants. A site owner may be able to make 

the land available for a large solar project, which can be the basis for a community solar 

project. Ownership structures for these projects vary, but the large projects are typically 

owned or sponsored by a local utility. Community solar gardens are distributed solar 

projects wherein utility customers have a stake via a pro-rated share of the project’s 

energy output. This business model is targeted to meet demand for solar projects by 

customers who rent/lease homes or businesses, do not have good solar access at their site, 

or do not want to install a solar system on their facilities. Customer pro-rated shares of 

solar projects are acquired through a long-term transferrable lease of one or more panels, 

or they subscribe to a share of the project in terms of a specific level of energy output or 

the energy output of a set amount of capacity. Under the customer lease option, the 

customer receives a billing credit for the number of kilowatt-hours their pro-rated share 

of the solar project produces each month; it is also known as VNM. Under the customer 

subscription option, the customers typically pay a set price for a block of solar energy 

(i.e., 100 kWh per-month blocks) from the community solar project. Other models 

include monthly energy outputs from a specific investment dollar amount or a specific 

number of panels. 

Community solar garden and customer subscription-based projects can be solely owned 

by the utility, solely owned by third-party developers with facilitation of billing provided 

by the utility, or a joint venture between the utility and a third-party developer leading to 

eventual ownership by the utility after the tax benefits have been absorbed by the thirdparty developer. 

There are some states that offer solar incentives for community solar projects, including 

Washington State (production incentive) and Utah (state income tax credit). Community 

solar is known as solar gardens depending on the location (e.g., Colorado). 
27 

6 Conclusions and Recommendations 

The site location considered for a solar PV system in this report is a suitable area in 

which to implement solar PV systems. Using land that cannot be used for other purposes 

would minimize the environmental impact of a solar generation plant. Installing a PV 

system on the compromised land at the site could generate approximately 5.2 million

kWh annually and represent a significant distributed generation facility for the area. 

To establish the financial performance of the system, an analysis was performed using 

SAM.14 Using the inputs and assumptions summarized in Section 5.1, the SAM tool 

predicts the IRR and the LCOE. The PPA option gives the investor an after tax IRR of 

15% with an LCOE of $0.14–$0.16/kWh. The municipal ownership option has a payback 

period of 13–14 years with an LCOE of $0.15–$0.17/kWh. The entire results and 

summary of inputs to the SAM is available in Appendix B. 

It is recommended that the site owner, SVSWA, further pursue opportunities for a solar 

system installation on the Crazy Horse Landfill site. The next steps for solar 

development are:

1. Determine financing structure

2. Issue request for proposal 

3. Review proposals 

4. Award contracts. 

For multiple reasons—the high cost of energy, the dropping cost of PV, and the existence 

of a good solar resource and possible incentives—this report finds that a PV system is a 

reasonable use for the site. A government-owned PV system that provides a reasonable 

payback and is easy to implement is one recommended option if off-takers for the power 

can be found. Alternatively, a third-party ownership PPA may be the most feasible way 

for a system to be financed and installed on this site. Depending on the available capital 

and business model, an RFP could be written for any one of the finance options presented 

in Section 5.4.

 

14 For additional information on the NREL System Advisor Model, see https://sam.nrel.gov/cost. 
28 

Appendix A. Assessment and Calculations 

Assumptions

Table A-1. Cost, System, and Other Assessment Assumptions

Cost Assumptions

Variable Quantity of 

Variable

Unit of Variable

Cost of Site Electricity 0.17 $/kWh

Annual O&M (fixed) 30 (first 15 

years), 20

(years 16-25)

$/kW/year

System Assumptions

System Type Annual energy 

kWh/kW

Installed Cost 

($/W)

Energy Density 

(MW/acre) 

Ground Fixed 1,501 $3.49–$4.00 5.74

Other Assumptions

1 acre 43,560 ft2

1 MW 1,000,000 W

Ground 

utilization

80% of available 

area
29

Appendix B. Results of the S\VWHP Advisor Model 

Figure B-1. Cost of electricity for different costs and ownership options 

Figure B-2. System electricity production 
30 

Appendix C. Results of the JEDI Model

Photovoltaic - Project Data Summary based on model default values

Project Location California 

Year of Construction or Installation 2013

Average System Size - DC Nameplate Capacity (kW) 3,500

Number of Systems Installed 1

Total Project Size - DC Nameplate Capacity (kW) 3,500

System Application Utility

Solar Cell/Module Material Crystalline Silicon

System Tracking Fixed Mount

Base Installed System Cost ($/kWDC) $3,916

Annual Direct Operations and Maintenance Cost ($/kW) $25.00

Money Value - Current or Constant (Dollar Year) 2012

Project Construction or Installation Cost $13,707,678

 Local Spending $6,644,914

Total Annual Operational Expenses $1,612,888

 Direct Operating and Maintenance Costs $87,500

 Local Spending $80,500

 Other Annual Costs $1,525,388

 Local Spending $2,888

 Debt Payments $0

 Property Taxes $0

Local Economic Impacts - Summary Results

Jobs Earnings Output

During construction and installation period $ (2012) $ (2012)

 Project Development and On-Site Labor Impacts

 Construction and Installation Labor 18.5 $1,195.90

 Construction and Installation Related Services 21.1 $992.10

 Subtotal 39.6 $2,188.00 $3,645.70

 Module and Supply Chain Impacts

 Manufacturing 0.0 $0.00 $0.00

 Trade (Wholesale and Retail) 4.5 $263.90 $794.00

 Finance, Insurance, and Real Estate 0.0 $0.00 $0.00

 Professional Services 6.2 $313.70 $1,063.60

 Other Services 10.5 $771.60 $2,672.90

 Other Sectors 15.6 $603.40 $1,156.50

 Subtotal 36.9 $1,952.50 $5,687.10

 Induced Impacts 27.0 $1,231.90 $4,377.20

 Total Impacts 103.5 $5,372.40 $13,710.00
31 

Annual Annual

Annual Earnings Output

During Operating Years Jobs $ (2012) $ (2012)

 On-Site Labor Impacts

 PV Project Labor Only 0.8 $48.80 $48.80

 Local Revenue and Supply Chain Impacts 0.3 $16.10 $53.20

 Induced Impacts 0.2 $10.60 $37.60

 Total Impacts 1.3 $75.50 $139.60

Notes: Earnings and Output values are thousands of dollars in year 2012 dollars. 

Construction and operating period jobs are FTE for one year (1 FTE = 2,080 hours).

Economic impacts "during operating years" represent impacts that occur from system/plant 

operations/expenditures. Totals may not add up due to independent rounding.