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Placerville council authorizes Johnson Controls to begin wastewater plant solar work, approves temporary funding plan to meet PG&E NEM deadline
Summary
The Placerville City Council authorized Johnson Controls to begin construction of a solar array at the Water Reclamation Facility and approved an initial funding plan using wastewater reserves to meet a December deadline tied to PG&E net-energy-metering rules.
City Manager Morris briefed the council on the long-running Water Reclamation Facility photovoltaic (PV) project and recommended authorizing Johnson Controls, Inc. to begin construction before the State Water Resources Control Board executes the final agreement. Morris said the project team has been pursuing funding since February 2018 and described a protracted process with shifting state funding commitments; he said the city now has state approval in principle but expects the state’s legal drafting and signature process to take up to three months and that staff was told the state would “expedite” drafting but not complete it before October.
Morris explained the urgency: the city holds interconnection and rate treatment under PG&E’s NEM 2 program that, under the current permit and application dates, requires the system to be operational by Dec. 31, 2025. If the project does not meet that deadline the city will be subject to NEM 3 rates, which Morris said would reduce the project’s estimated annual savings from roughly $150,000 under NEM 2 to about $37,500 under NEM 3.
To avoid losing the NEM 2 treatment, Morris said staff negotiated a construction schedule with Johnson Controls and proposed using wastewater enterprise reserves to fund the first invoice—an initial payment estimated at $1,600,000—so the vendor could mobilize. Johnson Controls agreed to proceed with that initial payment and delay further invoices until the city receives state reimbursements, Morris said. The total project cost presented to the council was about $3.9 million. Morris also noted reimbursements from the state may take 30–45 days after contract execution, and staff would monitor cash flow and interest exposure while funds are outstanding.
Public comment covered both support and skepticism about state financing. Sue Rodman urged the council to proceed to secure the favorable PG&E rate; another commenter stressed skepticism about relying on state reimbursement. Council members expressed concern about financial exposure but said prior financial analyses suggested the project would be beneficial even on a loan basis. After discussion a motion to move forward with staff’s recommendation passed on a roll-call vote: Councilmember Carter—Aye; Councilmember Noe—Aye; Councilmember Yarbrough—Aye; Vice Mayor Gottberg—Aye; Mayor John Clerici—Aye.
