alma mater save 9 million convert to solar ozark christian college lanceschaubert

Will My Alma Mater Save 9 Million Dollars ?

Tis the season for phonathons — political, religious, and otherwise.

Got a call from my alma mater and I was unfortunately unable to give to their phone-a-thon cause this year, but I figure I can give something better. Something that has me REALLY excited, hopeful, and proud: together, we could generate over $ 9 million in savings for our alma mater.

How can we do that?

Well let’s take a look at the college rooftops:

alma mater save 9 million convert to solar ozark christian college lance schaubert

The red space is composed of south- or heavenward- facing rooftops. By my very conservative back-of–the-napkin math, I’m guessing at least 68,750 ft2 of usable space. Not to mention, it’s on a hill that overlooks the city — a rarity if you know the Ozark mountains.

Rare enough, in fact, that I’ll dare to call it providence.

Currently, Ozark uses 261,372 kwh of electricity every year. This costs them an annual $24,183 in payments to Empire electric — a utility monopoly known for its draconian business practices such as lobbying the Missouri State legislature for an annual rate increase of around 10% annually, burning old tires taken from local residents (bad for breast cancer odds — which affects some of our faculty), selling the heat off said tire smog back to Joplinites as electricity (“usury” in the bible), and even refusing to reinstate basic rules that once kept people who cannot afford to pay their electric bills from freezing to death. Yes, that happens in America.

This self-described “Empire” Electric District has averaged an 8% average return on revenue for the last ten years. They made $577 million in 2011 contrasted against the $557 million in 2012 and the $541 million in 2010. You may be wondering: what happened in 2011 that was so uniquely profitable next to its sister years, particularly since in 2011 the SnP downgraded the United States’ credit ranking and the NASDAQ fell 7%?

I’ll save you the trouble: the Joplin tornado happened in 2011.

Perhaps insurance payouts coupled alongside emergency bailouts can make for an extra profitable year when you’re a utility company in a disaster zone?

alma mater save 9 million convert to solar ozark christian college lance schaubert

Empire’s ethics aside, a 10% compounding of our $24,183 utility bill is $4,399,937 over the next 30 years. It is insufficient to have a good offense (income through tuiton, fees, and endowment — what Ozark calls “The Difference”). We must also have a good defense (reducing expenditures through clever use of our available resources). I’m borrowing grammar from Dr. Thomas J. Stanley’s The Millionaire Mind.

This is where I get excited, gang:

Ozark could literally save millions by going solar. I took the liberty of calling Missouri Sun Solar — a family-owned business — to get a quote on installing 261,000 kwh on our usable roof space. Tom Cotter (new acquaintance through this post) just gave me a month-by-month estimation of the specs on this sort of system.

According to MSS, it would cost OCC something in the ballpark $250,000. Add this to the fact that Empire Electric has levied an additional tax from Ozark on every single bill — a tax allocated for green energy credits for swaps like this — then realize that Empire refused to subsequently pay out of that fund to those in the region who switch to solar, lost a Missouri State Supreme court appeal to that effect, and are now forced to pay back the $25,000 per meter they took from us and others if we pull the trigger before the end of the year. Read: free money for my good mother.

Ken Idleman once said he wanted to raise up pirates through Ozark. Well he raised up at least one: I’m literally proposing we take back — legally and ethically — what was stolen from us — illegally and unethically — in the first place.

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To review, the compounding equation for our monthly payments factored by Empire’s rate increase ::

A = PMT (((1 + r/n)nt – 1) / (r/n))

Where ::

  • A = Total amount Ozark owes Empire over t years
  • PMT = The amount Ozark owes Empire every month this year
  • r = Empire’s average rate increase
  • n = number of times Empire appeals for a rate increase per year
  • t = number of years
$24,183 + [({1 + .10/1}30-1 ) / (.1/1)]
=
$4,399,937
– $250,000 installation fee
+ $150,000 from Empire for our six-meter rebate
_____________

$4,299,937

…in extra cashflow for Ozark over the next 30 years

 

Feel free to check my math if you don’t believe me.

And likely, it’s worth even more:

 

By going off the grid, our school would be energy independent for years to come. After all, the very first solar cell ever invented is still going strong after 60 years. Granted, that’s a controlled environ, but even assuming a 30% decay in solar efficiency after 60 years — something utterly unheard of in solar, but let’s start with a very conservative estimate. At a 5% (rather than a 10%) rate increase, which is super conservative, that still lands us at around nine million dollars saved by 2075.

“Well that’s cute, Lance, but what about the up front cost?”

Well for one, we alumni do have a habit of raising about $300,000 every year, so that’s a wash. For another, there are financing options, also a wash. For a third this is money that is already allocated for our alma mater’s electric bill — another wash.

This thing’s triple-washed. It’s squeaky clean. Plus there’s the great commandment of balance sheets:

Thou shalt not not double-count liabilities.

It’s a liability only once — either it’s an outgoing expense for your utility bill or it’s an outgoing expense for your solar installation. I beg my friends to stop repeating this nonsense of “we can’t be going into more debt.” The school is already in debt to the tune or $24,183 per year to an electric monopoly who charges 10% interest on its loans. Ben Franklin taught us Americans that all money is debt. Empire has a claim on that money. It owns our utility debt.

No, I’m not asking my alma mater to add another liability.

I’m just challenging her to refinance in order to turn a current liability into an eventual asset.

A nine-million-dollar asset.

…assuming a 5% rate increase.

At a 10% rate increase, it’s an eighty million dollar asset.

And that’s not even including the positive press it would generate — a play right out of Stanford University’s book. We’d be the first private college in our movement to go fully solar. Free advertising! As a former ad man, I love free advertising. It’s the best, most lasting kind of press, also known as the Gladwellian “word of mouth,” which alone sells films and books and movie stars and basically anything other than toothpaste, boxer-briefs, dinner for two, and condoms — basically all the stuff you’d impulse-buy on an anniversary trip.

THE BIG QUESTION ::

Will my alma mater save 9 million dollars ?

 

Frankly, it depends upon you. Let me tell you a story:

Eight or nine years ago, I was pulled into the administration building along with two other artistic students — a poet named Krystal Lambert and a composer named Tony Anderson. We were asked to “brainstorm” (business-y word for “imagine” or “dream”) new ideas for a campaign that would focus upon the individuality of students. Seeing the leadership of the school take furious notes from our collective spitballing refreshed Krystal, Tony, and me.

At the end of the meeting, they asked us to spearhead the campaign even though grassroots is never a top-down phenomenon. I won’t speak for the other two who were in the room, but I will tell you why I turned down the offer of my good friends in the administration:

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“Just One” for me isn’t merely about future students (read: new tuition income).

“Just One” is about former students connecting naturally with the current student body for the betterment of our school’s future. After proposing several versions of this to different staff and faculty members over the years including The Ozark Commons of Master Craftsmen, I’ve realized this will never happen unless the alumni body actually flexes its muscles instead of given lip service to staying connected. It is insufficient for us alumni to merely preach the ideals of our school’s intransitive education. We must also be practical. As Chesterton said:

“With all his gentleness, there was originally something of impatience in St. Francis’ impetuosity. The psychological truth about it illustrates very well the modern muddle about the word ‘practical.’ If we mean by what is practical what is most immediately practicable, we mean merely what is easiest. In that sense St. Francis was very unpractical, and his ultimate aims were very unworldly.

“But if we mean by practicality a preference for prompt effort and energy over doubt or delay, he was very practical indeed.

“Some might call him a madman, but he was the very reverse of a dreamer. Nobody would be likely to call him a man of business; but he was very emphatically a man of action.”

— G.K. Chesterton in St. Francis of Assisi

We must begin.

So.

In every possible way, I am Just One. I care both about drawing new students into Ozark and about connecting with former students through dialog and action to carve out a better future for the school.

If you want to join me with this first discussion, share this article on your social medium of choice and tag it #SOLzark. At very least, start a conversation about this, even if you’re skeptical — even if you absolutely oppose everything I just wrote. .  I even added a countdown clock in the left sidebar (black footer on mobile). That countdown clock exposes just how many days the school has left until Empire District reduces Ozark’s personal discount by a factor of two. Our school has exactly that long to initiate a solar deal.

“During the winter, Lance?!”

Sure! Why should it be always winter and never Christmas at Ozark? I say we warm her up. I mean, she’s a city on a hill, right? Should we literally hide our light under a bowlful of shady Empire practices?

Or should we put our light on its stand, angled at 30°,  atop our holy hill that the whole world might see?

Fellow alumni, I have done my part.

Should our alma mater save $ 9 million through a #SOLzark plan?

 

monogram transparent

pattern  in cover image borrowed  from Martin Abegglen

 

Inspired?
You should read our Beauty Manifesto.

 

 

 


 

Corrections and clarifications ::

As I only have data that’s public domain, there is only so much that I can generate myself.

  1. Solar arrays are measured in KW not KWh in case that was unclear — 843 x 255 watt panels = 215 kW system (thanks to Tom Cotter for clearing this up).
  2. Regardless of the current recent rate increases at Empire, a 5% steady rate increase (1% above inflation) means an even more conservative estimate of $9 million. At 10%, it’s up to 80 million. I’ve added alternate projections to the spreadsheet.
  3. The whole post is predicated upon three assumptions (a) that Ozark takes advantage of the full per-meter rebate, (b) that Ozark replaces all of their energy expenses with an on-site solar array, (c) that Empire increases rates steadily. Things like inflation factor into Empire’s costs, so regardless of their profits, these costs trickle down into Ozark’s expenses.
  4. By Tom Cotter’s estimate:

Another angle would be to look at OCC cost of power per kWh now (around 9 cents) vs what their cost of power for the solar would be in year 1 and subsequent years.

Ballpark system cost is $567k before any incentives.

That is a 162kW system with about 635 solar panels (if they are 255 watts each).
Price assumes contractor charges $3.50 per watt on price for the project. ($3,50 x 162kW = $567k) If they wrote a check they would replace 9 cent power (current utility cost) with 16 cent power. Assuming a 4% utility increase each year it would take 16 years until they broke even on cost of power. That is NOT factoring any incentives. So the question is, what are ALL the incentives they can use? (Local solar companies can help there) Also, as a non-profit they can’t use the federal tax credit of 30%. I’d probably suggest third party financing such as a lease or PPA so that the company that owns the solar can take the tax credit and pass that savings down to OCC in the form of a lower price per kW.

If that’s true, then we’d drop the total down to $5.5 million for 60 years and $1 million for 30 years, assuming Tom’s 4% rate increase — which is merely the rate of inflation. At this rate, EDE would make a 0% profit so 4% increase is pretty much guaranteed for a publically-traded utility monopoly that hopes to stay in business.

All of that to say: the point of this is to start an in-depth conversation quickly. Again, there’s only so much I can do with the data I have available.

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On the ethics of this post (how’s that for #meta ?) ::

 

November 13th, 2015 —Well, it was bound to happen eventually, boys and girls. I have been accused of accusing Ozark of something like collusion or conspiracy with Empire. It seems (and this is the part of the critique that’s valid) that my syntax and word choice implies that if Ozark doesn’t decide to do this, they are purposefully contributing to evil.

Look. If the school shuts down because of a bad financial decision they committed to, that’s obviously worse than if they omit a shift away from unsustainable energy (read: solar energy trapped in fossilized fuel as opposed to “sustainable” which is solar-direct) and an unethical company. Also, as I’ve said like a million times, I’m no expert so (as with my comment to President Proctor) check the math.

Further, the comments about Empire were and remain a call to ethical employees inside an unethical company to call for change. The easiest call for change isn’t from clients, but employees and shareholders, many of whom were ignorant of these critiques before this post.

So yes. Of course I have room in my philosophy, methodology, and theology for grace for a large organization. It is not easy for Ozark to make a decision and when you’re making decisions that affect this many people, you’re bound to get something wrong.

My push isn’t for the lesser of two evils, but the greater of two goods. It’s up to them to decide when, how much, where, and so on. And the decision will be much harder than my questions and discussion prompting.

I’m leaving the post unchanged to remind my future self that clarity, syntax, and word choice matters a great deal.

11 Comments

  1. From a Redditor ::

    /u/boo_baup 1 point 33 minutes ago

    It’s worth considering how much they pay for peak kw in addition to kWh and how solar may or may not impact that. Only way to tell is by looking at their bills. Also consider if their utility will credit them for solar export at wholesale or retail rates.

  2. Thanks, Lance! I’m in Japan right now speaking at a leadership conference and visiting some alumni (Jared Henke says hey). Thanks for both the thoughtfulness and homework reflected here. And I truly appreciate your concern for the stewardship of both our dollars and our environment. (Japan has some ingenious ways, I’ve noticed, to save water and space.). We want to do our best at Ozark to steward both well for God’s glory and the world’s good.

    We’ve passed your post on to our administrative team already, and we’ll take a serious look at this. And even if we aren’t able to implement anything by the end of the year, it remains a great idea worthy of strong consideration for other reasons you mentioned. I remember well the brainstorming session you mentioned, and it does my heart good to see that the impassioned creativity that sparked me to ask you into my office that day is still alive and working on behalf of both OCC and the kingdom of God. Appreciate you, my friend!

    1. Hey bro, thanks so much for your continued open-minded posture. You and Mark Scott continue set a pace for all of us in open dialog and nimbleness when it comes to new ideas.

      Tell Jared I said, “Hi.” Miss that guy like crazy and yeah, the Japanese are incredible at this stuff. Reminds me of Fred Danback’s testimony.

      I would reiterate, again, that I’m a complete amateur at this stuff and hope only to spark a thorough conversation about the possibility: I know you’ll run much better numbers than me — my job is merely awareness and opening a dialog around a potential blind spot, nothing more.

      That could mean that you simply take the per-meter rebate and run with it as far as it goes and no further, installing a partial array only as far as the rebate/tax incentive/etc. money goes. And even if you can’t do it by the end of the year, you’ll still have $12,500 per meter locally from Empire and potentially other options nationally, though being a nonprofit may limit you on some incentives.

      In any case, I hope it helps in some small way, even if it’s just to spur on strange, diagonal thinking in regards to shaving costs over the long haul.

      Love you guys and excited for whatever the future holds.

  3. Electric companies, namely Empire electric are not nearly as evil as you paint them to be in this article… Nor is solar power nearly as good of an option as you paint it to be. The fact that no private college has done this yet should be evidence enough of that.. Do you think that maybe at least one college in a state like California that gets many more daylight hours than Missouri would have tried it by now if it was a viable option?

    1. You mean how MBC helped plan for solar power at Va. Private colleges, Sierra College erected a solar array, and Stonehill College built something similar?

      That was only one Google search page deep, my friend.

      As for Empire, there’s a big difference between attacking systemic injustices built into a corporation over years of neglect and attacking the employees of that corporation. Assuming you or someone you know is an employee, I would point you towards Fred Danback’s example when it comes to questioning the ethics of your employer.

      That said, you didn’t address any of my major points so I’m assuming you’re not taking your rebuttal very seriously. From a quick search, it looks like there are half a dozen electric companies to choose from in and around Clear Spring Rd. Oklahoma, so it’s a bit different in your neck of the woods than in southwest Missouri where you have no choice.

      Of course, I too am in New York City where we have choices so the excessive rate increases (also called “usury”) aren’t nearly so bad up here.

      In any case, thanks for the first comment Mr. Hayward.

  4. Also from Redditor ::

    There is no such thing as ‘free’ energy, in fact, batteries are not 100% efficient and that balancing system takes some more kWh, but financially it is more than compensated by the lower ‘peak demand charges’, it is one of those ‘low hanging fruit’ things.

    Other low hanging fruit:

    Replace incandescent light bulbs with LED lights.

    Thermal insulation, floor, walls, roof, double/triple paned (reflective)windows, outdoor sunshades, painting the walls/roof white for a higher albedo, etc.

    Heat loss (kWh) is “(T_outside – T_inside) / Thermal resistance”.

    The mfg/sales-people of HVAC systems mostly care about profit (cheapest product) and not about ‘running cost’ afterwards.

    Humans convert oxygen into CO2 that needs to be replaced, and if a ‘full’ classroom can handle 100 people, than that is the volume the ventilation is replacing 24/7, even when empty, this PDF explains it better.

    Cheap ventilation systems just dump the (dirty) cool air outside and have to cool all the fresh (warm outside) air before blowing it inside, there are (CO2-driven ventilator) heat-exchangers that can recover most of that thermal energy for further savings.

    There seems to be a technical college in the neigbourhood, and students needs projects to write their papers and whatnot, could be a big help.

  5. As the CEO of Missouri Sun Solar I would like to address a few things. First off, I am super excited to be providing solar energy to over 500 customers in Southwest Missouri. I have been truly blessed by moving my business to Springfield, MO. Without talking about me the entire time I would like to clarify that solar works great and can offset 100% of an electric bill every month for 40 years with the orginal set of solar panels.

    I also want to add that Empire District Electric does pay these very large rebates to go solar. Some say schools are not going solar. I have sold over 1,000,000 watts worth of solar panels to school district’s in Missouri. If private schools have not went solar then you should explain the above laid out economic benifits to them.

    If the college would like to know why Greenfield schools just pulled the trigger on a 600,000 watt solar system then give me a call and I would be happy to talk.

    We just donated solar panels to crowder college solar decathlon house team. We believe in helping our local communities.

    Please excuse any odd or mispelled words. Typing on my phone provides new words for me sometimes.

    Yours truly,
    Caleb Arthur
    CEO
    Missouri Sun Solar
    417-417-1786

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