“Why Would We Pay For Something Twice?” Vote To Approve Battery Lease Agreement Despite Troubling Clauses Narrowly Fails At WAPA Board Meeting
Despite push from several board members, unresolved concerns about battery lifespan and double payments lead to the defeat of the motion
2024-06-28 16:46:04 - VI News Staff
During Thursday’s meeting of the Water and Power Authority Governing Board, members narrowly defeated a motion to approve a battery lease agreement despite several unresolved concerns about the contract being raised by board members and WAPA management.
Up for discussion was the agreement between WAPA and V.I. Electron to supply battery storage to the solar farm at Estate Petronella on St. Croix. The solar farm, once energized and connected to the grid, is supposed to be the vanguard of a major investment in renewable, sustainable, cleaner energy in the territory.
The battery storage lease would run over the course of 25 years, representing a total of approximately $24.2 million over its lifespan. In response to a question from Kyle Fleming, who was replaced as board chair during this meeting by Hubert Turnbull, WAPA CEO Andrew Smith noted that the batteries in question have a useful life “somewhere in the 12 to 14 year range.” With no clause in the lease that stipulates a schedule for replacement or refurbishment of the battery, Mr. Smith confirmed Mr. Fleming’s assessment that, “What’s put in place on day one is what we’re expecting to have to survive the 25 years.” One mitigating factor, explained Mr. Smith, is that the lease is structured so that the level of payment is tied to battery performance. This could set up a financial incentive for VI Election to ensure that batteries are operating as efficiently as possible so that their revenue remains at an acceptable level, however Mr. Smith admitted that he does not know “what that breakpoint is, what that economic analysis is for VI Electron.”