Solar-powered yogurt and pop tops: How solar+storage helps a rural village to thrive

It is a brisk, sunny morning in November, and Don Harrod, the village administrator of Minster, Ohio, is standing in the middle of the town’s 4.2-megawatt (MW) solar field, talking about why plans to expand the project won’t include community solar — at least not yet.

The village of just under 3,000 residents had always envisioned phased additions to the project, which also has 7 MW of battery storage. Since the batteries went online in April of 2016, the combined revenue streams from the installation have saved the town’s municipal utility about half a million dollars. Community solar seemed a logical next step, Harrod said, to allow individual residents and small businesses to buy into the benefits of solar without having to put panels on their roofs.

That is, it seemed logical until Dannon, Minster’s top employer and electricity user, decided to add a 280,000-square-foot distribution center to its already-massive factory — the company’s largest yogurt manufacturing plant in North America — and then power the new facility with clean energy. At that point, the community solar project — aka Phase 2 — and its additional 7 MW of storage, became a de facto commercial installation.

“We were talking 4.2 MW of additional solar, and that was about what it would take to operate the distribution center,” Harrod said. The entire installation will be tied into to Minster’s distribution system, but Dannon will be buying all the power, he said.

As utilities large and small integrate solar and storage into their systems, the Village of Minster stands out as a practical case study in the innovation that can occur in a small, rural community with a savvy approach to business development and a surprisingly diverse industrial sector. For example, in addition to Dannon, the town is also home to Nidec (pronounced nee-deck) Minster, which, Harrod said, produces machine presses that stamp out 95 percent of the pop tops on soda and other beverage cans in the United States.

The town’s first solar-plus-storage project has been so successful — earning Minster national attention and a raft of awards — because it was designed to be privately funded and produce multiple revenue streams. The concept of storage providing multiple capabilities and revenue options — called “value stacking” — has been much discussed in the energy sector, but few have been able to make it work as effectively as Minster.

The town’s solar plus storage has improved overall power quality, helped it shave peak demand and associated critical peak pricing, and defer expensive grid upgrades, while also selling grid support services into PJM Interconnection’s frequency response market. PJM is the grid operator for 13 Midwest and Mid-Atlantic states, including Ohio.

“Minster is the first small public utility to pair solar and storage,” said Nick Esch, Senior Research Associate at SEPA. “The town has really become a model for the kind of public-private partnerships that will advance the use of storage. The partnership  enables value stacking, which includes savings for Minster and revenue — from PJM’s frequency response market — for Half Moon.”

An additional 19 MW of storage — Phase 3 — is also being developed, and will be built concurrently with the commercial project. Besides taking advantage of economies of scale, Harrod said, the goal here is to create a local microgrid that can be used to ensure power — and improved reliability — for critical facilities and local businesses in the event of an outage.

It will also be one of the first storage facilities selling energy directly into PJM Interconnection’s wholesale power markets, said Michael Hastings, the CEO of Half Moon Ventures, the Chicago developer that has partnered with Minster on all its solar and storage projects.

That said, Minster has not given up on community solar. The town had partnered with the Smart Electric Power Alliance (SEPA) on an initial market survey that revealed strong interest in a shared solar project, but also a need for more information and public outreach.

“Sometimes, designing a successful community solar program means knowing when to put a project on hold and wait,” said Dan Chwastyk, SEPA’s Utility Strategy Manager, who worked on the survey. “Our original idea was that Dannon would be an ‘anchor’ or early subscriber — to draw in other customers and make financing the project easier. But the company’s expansion — and its interest in procuring clean energy — changed the dynamics.”

Harrod is now talking with the town’s school district, which is working on renovation plans that could include adding solar or perhaps signing on as a new anchor subscriber for a community solar project. Superintendent Brenda Boeke sees a lot of possibilities for such a partnership.

“If there was a way to tie solar into that (renovation) project, we would be very interested,” she said. “The potential is huge to include the kids. It’s critically important that we start educating them young on the need for renewable energy, and by experiencing a solar field, I think we have an absolutely great opportunity.”

Small town, big business

The Village of Minster was founded in 1832 by a group of German Catholic immigrants whose fierce work ethic and community spirit remain a cornerstone of the local culture. This heritage is also at least part of the reason Minster has been able to avoid the loss of population and industry often associated with small rural towns.

Harrod, who at 51 has been village administrator for 24 years, says the town has thrived based on the ongoing expansion of its home-grown businesses, some of which have then been acquired by national or international companies. Dannon is marking its 50th year in the village, said Joe Box, plant director at the Minster facility. But driving up to the 58-acre plant, you can still see a small building that housed the local dairy that eventually grew into the business Dannon acquired. Similarly, Nidec Minster was originally Minster Machine Company.

Maintaining this strong economy means Minster must provide its commercial customers abundant, reliable, high quality power — with minimal fluctuations in voltage and frequency — at a price its small municipal utility can afford, while still keeping residential rates low.

Dannon alone uses about 58 million kilowatt-hours of electricity per year, Box said, and the 24/7 plant operations can drive substantial peaks and power fluctuations. For example, the factory pasteurizes millions of gallons of milk a year, and the pasteurization equipment has to be completely shut down and cleaned every one to three days.

The result, Box said, is that a lot of machinery may be turning off and later coming back on all at the same time. The factory is working on staggering the process, but he rates Minster and its solar plus storage high on providing reliable, steady power.

“I’ve managed several facilities over 20 some odd years, and the electrical infrastructure and processes that exist in Minster are the most consistent,” Box said. “I think a lot of it is due to the fact that we have storage capacity here as the result of the solar field.”

Minster started looking into solar about five years ago, Harrod recalled. After partnering with American Municipal Power — the town’s electricity provider — on other generation projects, “we were looking to find another cost-effective (resource) that would enable us to diversify our portfolio . . . shave our peak demand, and reduce our costs,” Harrod recalled.

The project was initially going to be solar only, but when Ohio put a two-year freeze on its renewable mandate in 2014, potential investors backed off, and the city had to recalibrate its bottom line. Storage made the project pencil out, Hastings said, at a competitive cost for Minster and Half Moon.

“We’re able to offer solar to them cheaper than (power from) coal, and still make money on the deal,” he said. He sees solar plus storage as “a pretty simple and elegant solution to a lot of municipal needs.”

The power purchase agreement (PPA) Minster signed with Half Moon on its original solar field was for around 7 cents per kilowatt-hour, Harrod said. With solar and storage prices falling, the PPA for Phase 2 came in around 5 cents per kilowatt-hour.

On the savings side, the village has cut its peak capacity and demand charges by about $150,000, Harrod said.  The town was also able to avoid a $350,000 investment in capacitors, a type of battery used to improve power quality. Those savings are passed on to customers through the town’s power adjustment factor — an adjustment to customers’ bills based on how much power Minister has to buy on spot markets to meet its peak demand.

The community solar challenge

Ask anyone in Minster about the town’s solar and storage, and they will talk about the recognition, pride and competitive edge the project has brought the community. In 2016 the village was named SEPA’s Public Power Utility of the Year, and Harrod has become a sought-after speaker at utility industry events across the country.

His next stop, in March, will be an international conference in Dubai.

“A lot of places have some solar, but not a lot of people are into the battery the way we are; we’re kind of on the cutting edge,” said Dennis Kitzmiller, a lifelong resident who has been Minster’s mayor for 22 years.

Looking forward to the next phases of the project — and the potential for a village microgrid — he sees ongoing benefits “from the business standpoint. It helps us cause . . . any business that would want to come into town knows that a half-hour power outage is not going to affect them. That’s a big thing.”

Bringing community solar to Minster could present a different kind of challenge. Funded as part of the Department of Energy’s Solar Market Pathways program, the SEPA survey found overwhelming interest in the general concept of community solar, Chwastyk said. But on questions aimed at probing local priorities, 20 percent or more of those surveyed said they needed more information or did not understand how the program would work.

Kitzmiller is typical of some of Minster’s older residents. He supports the idea of community solar, but for himself, he said, “It would depend how much you have to lay out, the term of the contract. I don’t know that for an older person that might be a good thing.”

“Getting this kind of feedback from the community is the foundation for any successful community solar program,” Chwastyk said. “One of the strengths of these projects is they can be sized and customized based on what customers want — for example, shorter-term contracts or different financing options.”

This is grid-edge innovation of another order. While larger cities — and their utilities — get attention for their pilot programs testing out new technologies and business models, Minster is navigating the energy transition by sticking with the basics. Engage with customers to understand their needs, alter plans when market conditions change, and stay focused on the bottom line.