Synergetics owners, Jim Raines, left, and David Palmer stand on the roof of their corporate headquarters in Starkville. The company’s solar array is the largest on TVA’s grid in Mississippi. Photo by: Micah Green/Dispatch Staff
November 16, 2013 10:22:32 PM
STARKVILLE -- For years and years the guys behind Synergetics were interested in solar power but never pulled the trigger.
The biggest hurdle: cost. It just wasn't financially feasible for the Starkville-based information technology company, which was founded in 1992 and employs almost 50 people.
"We didn't want to be green for the sake of being green," David Palmer, the company's 45-year-old CEO, said. "We didn't want to be green if it didn't make sense."
They took other "green" steps. They recycled. They installed energy efficient light fixtures. They changed the color of their corporate headquarters' roof from black to white.
In 2011, though, solar power began to make sense for Synergetics. Palmer said the "right mix" of federal and state programs, coupled with a Tennessee Valley Authority incentive, made it the right time for the small business to install, on the roof of its headquarters, 1,000 solar panels.
The following year, the company and its affiliates installed 500 more panels atop its 100,000 square foot roof.
Today, the array on Synergetics' Highway 12 West building in Starkville is the largest on TVA's power grid in Mississippi. It is believed to be the largest in the state.
"We love it," Palmer said, but he added it took nearly an entire year to design and put in place.
One solar panel is about 3 feet by 5 feet and weighs a little more than 40 pounds. The company had to do about $7,500 worth of reinforcement work so the array could sit safely on the roof. But installing the panels themselves, along with the supporting structures, only took about two months.
On Dec. 21, 2011, they flipped the switch and the system went live. Since that day the array has generated 752.4 megawatts of green electricity. That's enough power to fuel 68 average Mississippi households for a full year. That's the amount of energy it takes more than 54,000 gallons of gasoline to create.
While Palmer and Jim Raines, the company's president and chief technical officer, are proud of the environmental benefits of the solar array, the installation was a business decision made with one eye on the bottom line.
"We wanted it for green reasons," Palmer said. "But we didn't want to have to pay to have it. We wanted it to pay us."
Palmer, when interviewed last week, declined to say what the entire project's price tag was. He did explain how it has been paid for.
Tax savings, which come from a 30 percent investment tax credit for solar and from depreciating the solar asset, pay for approximately 50 percent of the project. A Rural Energy for America Program grant, administered through the USDA, covered approximately 25 percent of the initial project. And a low-interest loan from the Mississippi Development Authority was secured.
But a key component to getting the project in place was the "Green Power Providers" program offered by TVA. Essentially, that program is how the solar array is making Synergetics money.
The company signed a contract with TVA that will have the energy provider buying the electricity Synergetics creates for 20 years.
A common misconception is that a business or household using solar power utilizes what energy it creates. In fact, the electricity Synergetics' array generates is put directly on the grid and distributed. A meter monitors how much energy is put on the grid and each month, TVA pays Synergetics for it.
"You sell it," Palmer said. "It's 100 percent grid tied...whatever you put on that grid, they buy."
Palmer said the building that houses Synergetics' corporate headquarters uses more energy than the array creates. But TVA, per the contract, pays Synergetics a 12-cent premium for the electricity it puts on the grid.
For obvious reasons, the array creates more energy in summer months. Top months are June and July, when the array produces roughly 50,000 kilowatt hours each month. The lowest months are December and January, when the array produces about half that amount. But after 12 months combined, Synergetics has made more money off the electricity it creates than what it has paid for consumption.
"Because they pay us more for the energy we generate than we pay them for the energy we use, we come out ahead," he said.
The company has three more solar projects underway. One includes adding 1,000 more panels to the roof.
"We will not have a single bit of space left," Palmer said of the roof.
In 2013, TVA was offering a 9-cent premium with its "Green Power Providers" program. The program is currently closed, though, because capacity has been reached. The program is expected to re-open next year.
In the meantime, Synergetics is offering several "Solar Array Open House" events at its headquarters. The purpose, Palmer said, is to educate businesses on solar arrays.
The open house seminars will be held on Nov. 21 at 3 p.m., and Dec. 3 and 17 at 3 p.m. and are free.
William Browning was managing editor for The Dispatch until June 2016.
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