Vital Energy received the go-ahead Tuesday to begin negotiating a power purchase agreement with the V.I. Water and Power Authority for the interconnection of four businesses owned by Lockhart Reality, a move that company officials said will help its tenants.
Public Services Commission members approved Vital’s petition to become certified as a qualifying facility, which triggers the negotiations and makes way for the installation of rooftop solar systems at Lockhart buildings, including those in Charlotte Amalie and Tutu Valley. Vital is a subsidiary of Lockhart Reality, and has partnered with St. John-based Caribbean Solar Company for the projects.
In this case, Lockhart’s tenants are the primary power consumers and the solar installation is meant to serve as a backup during outages and other instances where WAPA’s system is down. The company would still purchase and distribute WAPA power during peak-use hours, company officials said, and is looking to negotiate the ability to bank storage to cover peak times when WAPA goes out, but the sun isn’t shining.
Lockhart Chief Executive Officer Gershwain Sprauve said Tuesday that Caribbean Solar has experience with rooftop installation, and is committed to operating and maintaining the systems. All projects will be financed privately, including any possible tax benefits, and the company expects to “realize a modest profit” through its investment, Sprauve said.
While PSC members had no concerns about the petition, they did discuss approving each project separately since, according to advisors Georgetown Consulting Group, there has historically been no standard interconnection rate for qualifying facilities. Each of Vital’s four projects could either be broken down in separate power purchase agreements (PPA) with different rates, similar to other contracts, or WAPA would have to look at standardizing the rate in order for Vital to have one comprehensive PPA, said Georgetown principal Larry Gawlick.
After WAPA officials said Tuesday they would prefer to have one agreement with four separate project listings, with individual start and end dates, PSC members voted unanimously to certify Vital and allow for negotiations to continue. The company would have to report to the PSC every six months, according to the final motion.