Four Pennsylvania schools have teamed up to support a Texas solar farm that will supply them with “virtual” renewable energy, joining a trend among institutions of higher education to address climate change.
Lehigh University, Lafayette College, Muhlenberg College and Dickinson College announced the partnership Monday to collectively purchase solar power. They signed a virtual power-purchase agreement to support production from of a 45.9-megawatt share of a new 200-acre solar farm that will be built at an undisclosed location Texas.
Under a virtual power purchase agreement, the buyer does not buy the actual power generated from a project, but compensates the producer for the difference between the market price of the electricity and the value of the renewable energy certificates it produces. The payments provide the solar producer with a guaranteed income source that can help finance its project. The schools, meanwhile, will continue to buy their power from the regional grid at market rates.
The schools announced the agreement at Second Nature’s 2020 Higher Education Climate Leadership Summit in Atlanta. They did not disclose the cost of the program.
“This project is one opportunity for Lehigh to demonstrate climate leadership and to energize the campus and broader community," Lehigh’s president John D. Simon said in a statement.
Universities are under pressure from activists to take the lead in combating climate change by procuring their energy from carbon-neutral sources and by disinvesting in fossil-fuel producing companies. Penn State University last year announced a power-purchase agreement to support construction of 70 MW of solar power production at three Franklin County farms. The University of Pennsylvania buys about half its electricity from carbon-free energy sources.
The solar project, combined with other on-campus renewable energy projects and energy-efficiency efforts, will allow Muhlenberg, Lehigh, and Lafayette to offset 100% of their electricity load with renewable energy, spokeswomen for the universities said. At Dickinson, which already has a 3 MW solar array on campus that supplies 30% of its power, about 75% of its electricity-related carbon emissions will now be offset.
The schools engaged CustomerFirst Renewables, a Maryland renewable energy adviser, to arrange the deal. Lindsay Irving, a CustomerFirst spokeswoman, said the company had engineered similar agreements for the Massachusetts Institute of Technology, as well as a combined agreement for American and George Washington Universities, called the Capital Partners Solar Project.
Texas is awash in renewable wind and solar projects, which has driven down the cost to customers, Irving said. She said the agreement with the Pennsylvania schools is expected to be cost-neutral over the 15-year term.
The Pennsylvania schools said they were attracted to buying solar power from Texas because they were told that a Texas-based project would result in about 15% more avoided emissions because that state’s power grid is more carbon-intensive, said Lori Friedman, a spokeswoman for Lehigh University.
The Texas project will also be sited on barren land, avoiding the clearing of trees or displacing a farm, which is often required for mid-Atlantic-based projects.
While the out-of-state solar credits will help the schools to achieve their own carbon-neutral benchmarks, the credits will not qualify for the new solar photovoltaic requirements under Pennsylvania’s Alternative Energy Portfolio Standards Act. The law was modified in 2017 to allow only new in-state solar projects to count toward a goal requiring 0.5 % of the electricity supplied in Pennsylvania by 2021 to come from solar resources.