A proposal to reduce one of its electric bills by nearly $250,000 per year using solar energy was heard by the Amador Water Agency Board of Directors March 11.

The proposal, by SunnyCal Solar, a division of San Jose-based Dollens Electric, was presented by manager Steve Dollens, who said he toured AWA water pumping facilities at Tiger Creek, Tanner and the agency's office properties, reviewed the electricity expenses at those locations and began work on a "preliminary assessment of possibilities."

Dollens said his assessment indicated a solar system producing 1.25 megawatts per year could reduce the current estimated $250,000 annual cost of operating the Tiger Creek pump stations and recommended a 5 to 7 acre array of solar panels at a total cost of $9 million to construct.

Dollens said his preliminary estimates show the electric costs could be reduced to approximately $2,000 per year and the system would pay for itself in 13 years.

Interim General Manager Gene Mancebo said Upcountry costs for Pacific Gas & Electric Co. to pump water approach $300,000 annually and AWA's bill for its entire network of systems could be close to $1 million.

Although it was not in his company's area of expertise, Dollens felt there were existing possibilities for government grant money to help pay for the construction of solar energy systems.

Dollens said his $9 million estimate to build this system included design costs but did not take into consideration any possible environmental review costs.

Dollens said he recommended the AWA construct the solar system under a "power purchase agreement," whereby AWA could also sell any excess power it generated, while retaining ownership of the system and the property on which it was built.

AWA legal counsel Steve Kronick said he would look at the AWA's charter to see if AWA could legally sell power produced by solar energy, since the language in the charter is primarily written in hydroelectric terms.

"I don't see a legal issue in this power purchase agreement as discussed," he said. "The issue comes in ... does the agency have the power (authority) to run a solar facility? The problem comes in, could we own the facility at the end of the project?" he added.

Director Debbie Dunn said she welcomed the opportunity to look at the solar energy option, or any other option with an end result of helping ratepayers keep bills under control, although she said the board should wait for the June budget numbers before committing to any large expenditures.

"One of the greatest expenses in our budget is power," she said. "I think this is an opportunity we need to look at."

She added, "The ratepayer is my boss, and if I don't find a way to save them money, then I guess they should un-elect me."

Dunn made a motion, seconded by director Gary Thomas, to direct AWA staff to spend a maximum of 60 hours of time working in conjunction with SunnyCal and PG&E staff to produce a more detailed proposal.

"If it's a chance to help our ratepayers, we need to be taking a look at it," Thomas said.

Director Don Cooper said he supported the solar concept but felt the timing was wrong as the AWA is facing a bond payment and may be forced to borrow money from an outside source in the near future.

The motion passed 4-0, with director Terry Moore absent.

SunnyCal has a branch office in Valley Springs, Calaveras County.

In other action, the board voted to begin holding additional special meetings in April to develop a strategic priority plan and address the AWA budget, including an anticipated cash flow shortage in May and June.

The board then voted to specifically agendize only planning and budget matters until the end of the fiscal year.

The board also voted to cancel all currently scheduled committee meetings, including engineering, budget and finance, rules and rates, public relations and personnel, and to only have those committees meet on an as-needed basis.

The AWA faces a bond payment of $1,003,012 due June 1 and may have to borrow money in order to make the payment. The board authorized Mancebo on a vote of 3-1, with Dunn voting no, to begin the process of "seeing what's available" from outside lending institutions. In a response to a request for clarification, Mancebo told the Ledger Dispatch the agency does have the cash on hand to make the payment but would then face a serious cash flow problem with its payroll and day-to-day expenditures.

"We can't do both," he said.

The next regular meeting of the AWA is March 25 at 9 a.m.