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Mahaska Rural Water System - Powering Water Treatment with the Sun - CoBank Site
Powering Water Treatment with the Sun
Seeking to contain rising operational costs, Mahaska Rural Water System located in south-central Iowa has taken an innovative approach that’s delivering both financial and environmental benefits to its system and members.
Mahaska serves 4,600 rural members: half are heavy-use livestock and other agricultural customers, and the other half are residents in small towns that range in population from 155 to 1,600. Its two water treatment plans are equipped to provide up to two million gallons of water a day, with actual demand somewhat lower at 1.5 million gallons, leaving room for growth.
Providing all that safe, clean water takes resources, and like all water systems, energy cost is a significant line item in Mahaska’s budget. Power cost accounted for $75,000 in 2023 with every likelihood of continuing to rise. After all, the system’s own carefully maintained records showed electricity costs had more than doubled between 2012 and 2022, from 10 cents per thousand gallons of water to 23 cents per thousand. The company’s leadership sought a solution from the sun, exploring the installation of a solar array for both the potential cost savings and the environmental benefits.
“We had been exploring solar power for nearly five years as a natural extension of our commitment to protecting natural resources – like the water we provide. With improvements in the solar technology, combined with our escalating electricity costs, it was making more and more sense,” says Randy Pleima, General Manager. “We undertook six months of due diligence with our solar partner, exploring multiple scenarios to ensure the project was feasible and would have a reasonable pay-back period.”
Not everyone would think of Iowa as an ideal solar location, but extensive research by a leading solar industry partner proved the numbers. Mahaska’s solar array is expected to provide 462 kw of power, sufficient for virtually all the plant’s electricity needs. The board approved the project in 2020, when it was beset by pandemic-driven supply chain problems leading to dramatically increasing costs. A request for a 30% down payment to hold the contract and ensure material and equipment supplies led to a call to long-time lender, CoBank.
“We’ve borrowed regularly from CoBank since it was formed in 1989 and from its predecessor bank before that,” says Randy. “We appreciated their quick response and the different scenarios and options they offered – just three months later, supply costs had almost doubled.”
Within two weeks, the $670,000 financing was in place and project costs were locked down. However, the company postponed until 2023 to access a federal infrastructure program that provides direct payments to cover 33% of the costs for renewable projects.
Mahaska’s solar array is slated to be commissioned in early 2024, with 903 panels situated on about an acre of the treatment plant’s 20 acres. The project has a 10-year payback period, enhanced with a guarantee from the solar company that the panels will remain at least 80% efficient for 25 years.
“This was the right time for us to undertake the solar project, as the financing, contracting and government programs lined up,” says Randy. “We’re proud to be one of the first rural water systems to install solar, and our customers appreciate our commitment to keeping their costs down while also reducing our impact on the environment.”
