IRR Bull$hitt Bookkeeping
CBT announces $900,000 CBT grant funding for community alternate energy systems.
To be selected for funding, projects must demonstrate a positive return on investment .
The Area Director for RDCK Area E, Ramona Faust found the Pembina Institute from Alberta, to do her calculations. They told her what she wanted to hear.
I had previously spoken with the director asked her to contact me so I could go over her
solar quote, she never called, I read in the newspaper the systems were installed.
When I emailed Ramona telling her how disappointed I was she replied
"we did our homework".
They used the IRR bookkeeping method of calculating a postive return.
Balfour BC received grant money for solar systems on their Golf clubhouse, community hall and seniors centre.
What is IRR bookeeping? ( IRR - internal rate of return)
IRR - equivalent to EBITDA (earnings before interest, taxes depreciation and amortization)
Warren Buffet calls EBITDA
I don't really know bookkeeping but it appears to be a method of making things
look better than they are.
Anyone can show a positive return and get grant money this way.
We all lose.
Society loses grant money better used for real needs. Nelson hydro loses power sales
profits that could help bring rates down and we increase our carbon footprint. Nothing is cleaner
or greener than our waterpower spilling down the river with the lost profits.
Nelson already has its phoney community solar garden, the hydro manager brought city council
a business case. Solar projects have a business case if they can payback in 25 years his consultant
gave him a report showing a 25 year payback by fiddling the numbers.
We credit the Balfour community solar systems full retail credit, all in summer when Nelson hydro can make full 16MW nameplate hydropower. They cash in that credit in winter when solar doesn't work and Nelson hydro is reduced to its licensed 9.1MW generation and buying the most excess
power from Fortis at double our generation costs.
Nelson hydro customers lose all the way. Paying full retail for the phoney solar garden so that money is distributed among those who bought a 25 year contract for the power of a solar panel, and subsidize these community solar power projects. Even though Nelson hydro's own bylaw says
they will only buy excess power if it makes economic sense for Nelson hydro!
Two Alberta companies bid on the Balfour systems, you can find that info in the RDCK AGENDA REPORT starting page 441.
the details of how each company performed the calculation is unknown. It is suspected the calculations are not similar and may or may not include levelized operation and maintenance costs.
In the report the RDCK states they must ensure public dollars are spent prudently, where is their due dilligence? Two bidders different calculations and they don't know whats included?
The winning Alberta bid calculations showed IRR returns of +0.5% , -0.4% and +3.8%
These calculations presumed Nelson hydro would credit any excess power at full retail. Against
Nelson hydro's own bylaw, I brought this to the attention of everyone......nothing changed.
The RDCK Board Report Agenda states(regarding Nelson hydro crediting full retail): This is the current offering by Nelson Hydro but there is no guarantee Nelson Hydro will honour paying out the credit at the end of the year if the building produces more electricity than it consumes.
If Nelson hydro enforced their bylaw there would be no phoney positive return.
Even the cities own expert, manager of Nelson hydro found a consultant for the community solar garden to show a business case no different that the IRR Bull$hit bookkeeping method.
Maybe that is why he isn't enforcing the bylaw, it wasn't enforced with their own political
The public are told it will payback in 12 to 15 years, only those who invest will benefit etc.
And more and more public grant money keeps coming for more of this.
Regional district taxpayers paid for a new roof on the Balfour community hall, $16,000. Was this so they could install solar panels or did the roof need replacing? All the penetrations necessary to
install solar panels creates a huge leak risk on a metal roof.
|The community hall with its new asphalt roof and solar panel tracks installed.|
Above the Balfour Golf Clubhouse with over 40kW solar installed, the Nelson hydro bylaw
states a maximum of 25kW, their on line public data suggests only 24.8kW is installed. Although
the data is what one would expect from 40kW....very deceptive to anyone trying to use this
data for their calculations.
I have pointed this out to the past mayor and council, general manager of Nelson hydro, the RDCK and the area director where the systems are installed. I also pointed this out to the Alberta
installation company....asking why this has happened. Nobody talks.