Summit Farms PPA Frequently Asked Questions
What is unique about this project?
This partnership advanced a model that demonstrates how small, medium, and large organizations from diverse industries can harness their collective purchasing power to create a new large-scale renewable energy project – adding new emissions-free generating capacity to the U.S. power grid and advancing their respective sustainability goals.
MIT and its partners pursued a competitive bidding process for potential projects across the United States, and ultimately, it was their long-term commitment that attracted developers and allowed the project to be financed and built.
How do PPAs stimulate more renewable energy projects?
As renewable energy project developers look to secure financing for the construction of a wind or solar farm, they often seek to obtain a loan. Lenders will typically look at the revenue stream expected from the project and lend against that forecasted revenue. PPAs provide developers with an extremely predictable and secure revenue stream that banks are comfortable lending against. Therefore, PPAs have a direct impact on whether a project will get financed and built. If demand for PPAs increases, this signals to developers that there is demand for renewable energy projects and will stimulate project development.
Why did MIT choose solar?
MIT and our partners received 41 distinct bids and explored a range of wind and solar options located in fourteen different states. The solar project with Dominion was selected through a competitive round of proposals and by factoring in many considerations, including price, term, financial strength, and project characteristics.
Why doesn’t MIT just put solar panels on the roofs?
Dense urban locations like Cambridge don't have enough rooftop or open space to install the number of solar panels or wind turbines required to meet ambitious greenhouse gas reduction goals or combined annual electricity demand. Summit Farms in North Carolina spans roughly 650 acres. If we covered the Boston Arboretum (265 acres), the Boston Common (50 acres), and the entire MIT campus (168 acres) with solar panels, this would give us only 74 percent (483 acres) of the size of the farm in North Carolina. For a solar farm to be large enough to be effective, an off-site solution is often the best option.
Even outside of the Boston area, it is very difficult to find this much contiguous land, so solar projects in MA tend to be only a fraction of the size of projects in other states. In addition, the solar resource is not as strong in New England as in North Carolina, and as a result the productivity is lower and costs are higher.
Typically, on-campus solar installations generate a significant level of emission-free electricity but are limited to no more than a small percentage of consumption (generally less than 5%). Today, MIT has four rooftop solar installations totaling 100kW. MIT has identified 70 more roofs where solar projects would be possible for a 1-3% reduction of its total emissions.
If the solar power is generated in North Carolina, how does it reduce greenhouse gas emissions in Massachusetts?
Our atmosphere is one contiguous space, where greenhouse gas emissions circulate globally regardless of their source. Therefore, a renewable energy solution will always have a positive atmospheric impact, regardless of its location. In fact, a solar plant in North Carolina has a greater impact on decreasing overall emissions than a solar plant in Massachusetts would because it displaces generation from a grid with a higher average emissions factor. As part of a global movement to prevent climate change and address rising sea levels, investing in a solar plant in North Carolina is a better option to advance environmental goals and improve the health of the planet.
How can MIT claim to be using renewable energy when the project isnít directly supplying the Instituteís facilities?
Electricity from the grid is impossible to trace back to a specific generating asset, as electrons are fungible once they are put onto into the grid. In other words, a specific electron canít be directed to go to a particular user. With the growing importance of sustainability and environmental foot-printing, a system was devised to enable renewable energy users to be able to claim an emissions-free energy supply. The solution devised is based on Renewable Energy Certificates or RECs. A REC is produced for each MWh of renewable energy, and the ultimate long-term owner of that REC holds the claim to that renewable energy supply (one canít sell the REC after that claim has been made). Therefore, electricity supplied from the grid, when coupled with RECs, enables that user to claim they are using renewable energy. By keeping the Summit Farm project RECs, MIT demonstrates renewable energy use equivalent to 40% of our total electricity use on campus. (View information on Greenhouse Gas (GHG) Protocol, developed by World Resources Institute (WRI) and World Business Council on Sustainable Development (WBCSD))
How does the size of this project compare to other solar farms?
This project is the largest non-utility solar PV PPA in the United States in total megawatt-hours (MWh) contracted by “diverse organizations acting in aggregate” to add renewable energy capacity to the grid and advance their sustainability goals.
It will be among the largest university solar PV PPA projects in the United States, which include Stanford University, the University of California, George Washington University, and American University. MIT’s commitment is the largest solar energy purchase by a higher education institution in the eastern United States.
Does MIT anticipate doing more projects like this in the future?
MIT continues to evaluate new opportunities to reduce our impact on the environment and advance our climate action plan commitments. While there are no immediate plans to develop additional solar, wind, or other renewable energy projects, we will not rule that out for the future. We will learn what we can from this project to inform our next big opportunity.