POWER December 2010 - 70

RENEWABLE PORTFOLIO STANDARDS
The third party, assuming it has earnings
to offset with tax credits, also has an attractive
list of benefits:
■ Leverages capital to secure tax savings via
the ITC.
■ Qualifies for additional tax savings via accelerated
depreciation.
■ Leverages capital to produce a higher rate
of return than other investments, presuming
a well-executed project.
■ Minimizes long-term operational risk exposure
through the ability of the utility to
purchase the solar facility (if a buyout provision
is included).
DOD Project Implementation
The service branches of the DOD are developing
strategies to achieve the results
required under the various energy policy directives.
For example, the Army is actively
implementing projects to satisfy congressional,
administration, and DOD mandates
and directives. The Army expects to meet the
stricter definitions of EPAct 2005 on its way
to meeting the higher renewable energy goals
of the NDAA 2007. It is working to satisfy
multiple organizational goals and constraints
Depreciation Deductions
The modified accelerated cost-recovery system allows businesses to recover their investment
in eligible property through depreciation deductions. Solar facilities are classified
as five-year property. The American Recovery and Reinvestment Act of 2009 extended
a 50% first-year bonus depreciation for eligible renewable energy facilities acquired or
placed into service from 2008 to 2010.
while securing its energy supplies and focusing
on procurement of the lowest-cost energy
that meets high reliability standards and
minimum vulnerability to interruption from
natural or intentional causes, thereby increasing
security.
In recent years, the Air Force has led
the charge in renewable energy. According
to the DOE's Energy Information Administration,
the Air Force has been the top
federal purchaser of renewable power for
several years. In 2006 it purchased more
renewable energy than any other entity in
the U.S. The Air Force is the third-largest
renewable energy purchaser nationally, according
to the U.S. Environmental Protection
Agency.
The Air Force also continues to be at the
forefront in adopting alternative financing
and partnership arrangements with renewable
energy producers. It is beginning to use
20-year enhanced use lease arrangements
(EULs) to provide land for solar arrays.
These EULs have historically been used
to bring retail outlets or private industry to
military bases and are commonly accepted
under federal procurement regulation.
The Army National Guard, Air National
Guard, and Navy are also rapidly developing
and implementing procedures and standards
that follow the DOD's guidelines. ■
-Matthew Brinkman, PE (mbrinkman@
burnsmcd.com) is the solar business
unit manager for Burns & McDonnell's
Energy Group. Tanya Martella, MA, LEED
AP (tmartella@burnsmcd.com) is a client
manager for Burns & McDonnell's aviation
and facilities group.
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POWER December 2010

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