Austin staff to issue RFP for solar on city facilities, aiming for up to 25 MW to capture federal tax credits

City staff told the Climate, Water, Environment and Parks Committee on Dec. 2 that they will issue a request for proposals in the coming weeks seeking developers to install solar across dozens of municipal properties, with a preliminary estimate of roughly 75 sites and as much as 25 megawatts of capacity.

"Over the course of the last 5 months, we have analyzed over 250 city facilities for solar potential," said Zach Bauer, director of Austin Climate Action and Resilience, who led the presentation. Staff narrowed the list to about 120 candidate sites and said initial financial modeling shows a potential positive net present value to the city, but the details will depend on bids.

City staff emphasized urgency tied to federal tax policy. "Our project would need to commence construction by...July 4 to access" the 30% tax credit, Bauer said, citing safe-harbor rules that permit a 4-year completion window once a 5% expenditure is made. He added, "Time is of the essence to get this RFP out of the world, to get the bids back, to select a contractor, and to essentially get us locked in so we can receive that tax credit." Staff warned that if the credit is not secured the project may not be financially viable.

Austin Energy and Facilities Management joined the presentation to describe technical and procurement options. Tim Harvey, director of customer renewable solutions at Austin Energy, outlined two primary models staff plan to accept in the RFP: a city-owned model, in which the city issues debt or uses cash to buy and operate systems and capture bill savings directly; and a "solar standard offer" model, in which a third party owns the array, leases city property and sells energy to Austin Energy or directly to the city under negotiated terms. Harvey said the standard-offer approach shifts upfront capital and operations risk to a private owner while enabling revenue that could help seed a revolving fund.

Staff said they expect to accept proposals for rooftop systems, parking-canopy installations and, where feasible, ground-mounted arrays. Rohan Lillowala (climate project manager) said the 25-megawatt estimate would be substantial: "It would be enough power for 3,600 homes" and represent about 13% of customer-sited solar in Austin Energy's service territory, though he cautioned that the final portfolio depends on vendor responses.

Committee members pressed staff on several operational questions: whether the list of candidate properties would be made public (staff said yes), how phasing would be determined (vendors may propose optimized phasing; staff will evaluate portfolios), whether smaller local firms could compete (staff said the RFP could be structured to allow mixes and multiple winners), and how the program would affect ratepayers. Harvey said the standard-offer rate is based on Austin Energy's avoided cost and is "designed to be scaled without negatively impacting rate payers," and that any city-owned option's impact would depend on system performance.

Several members suggested offering a smaller "tier B" bundle for buildings under typical size thresholds so experienced residential or smaller local contractors could participate; staff said they have already reconsidered strict size cutoffs to broaden the pool.

Staff outlined a compressed schedule: issue the RFP in the coming weeks, accept responses January–March, finalize a financial approach and select winning proposals in spring, seek city management and council approvals in April, and begin construction between April and June to satisfy safe-harbor timetables. The RFP will include qualifications phases and multidisciplinary review teams, and staff plans to include a worksite agreement with labor language based on previous Austin Energy procurements.

The committee did not take formal action on a contract or budget at the meeting. Staff said they will return with RFP materials and the candidate list for review.