Pendleton Yacht Yard, on the island of Islesboro in midcoast Maine, saw huge electric bills due largely to spikes in power use from machinery. As part of installing a 40 kW solar array system at their facilities in 2017, they added batteries to smooth out their power demand. They’ll break even for the project in just under 10 years, when they are expected to finish paying back their loan. They’ve also purchased two electric vehicles and hope to add more.
BACKGROUND
Pendleton Yacht Yard has provided transportation services in some shape or another for several decades on the island of Islesboro. It was officially incorporated as a yacht yard in 1983, but before that, the Pendleton family owned a car garage, and before the island had any automobiles, they owned a livery stable.
Energy efficiency was not always at the forefront of family business operations. Today, though, under the second-generation leadership of Gabe Pendleton, Pendleton Yacht Yard embodies the spirit of island innovation and environmental stewardship. From limiting harmful runoff when boats are washed, to reducing energy consumption, Pendleton Yacht Yard has made a concerted effort to reduce carbon and other pollution—all for sound business reasons as well.
Running a boat yard requires the use of machinery and power tools which leads to a high energy demand, including occasional spikes in electricity use when multiple machines run at once. Because many utilities charge commercial customers for those peaks in demand, Pendleton Yacht Yard was receiving bills that averaged around $700 a month, with most of the cost stemming from peak demand charges.
It was a combination of these high energy bills and Gabe Pendleton’s return to the island in 2012, after spending time away studying and practicing law, that sparked the business’s clean and affordable energy aspirations.
HOW IT WORKS
Pendleton Yacht Yard has invested in three primary methods of reducing energy use and carbon pollution. They’ve purchased:
- Four rooftop solar arrays,
- A battery electric storage system, and
- Two electric vehicles (EVs).
The solar arrays on their own would have generated the majority of the electricity used at the yacht yard, but the periods of peak demand would have still been an issue. Without a way to store excess solar-generated electricity on-site, they would have had to draw more from the grid during periods where multiple power tools were in use. To avoid this, ReVision Energy, a Maine-based solar company, designed a system where one of the arrays charges a battery located inside one of their buildings. The battery then provides the electricity needed to cover peak demand and flatten utility consumption. In cases where they do still need to draw from the grid, through net energy billing, they can use excess credits that they have saved up during months where the solar panels generated more electricity than the yacht yard used. State regulations on net energy billing dictate how customers can offset their electricity bills using the output from small renewable energy projects
The solar arrays also charge the electric cars that the yacht yard purchased in 2018, since the charging station is on site. Electric vehicles made sense for the business, because Islesboro is relatively small and well within the cars’ range. Employees mostly commute to and from the ferry landing which is only a couple of miles away from the boatyard. Since the cars use solar-generated electricity, they don’t emit any carbon pollution or result in additional fuel costs. Even if they were to charge their EVs elsewhere, they’d still reduce emissions, as electric motors are significantly more efficient than traditional engines.
Pendleton Yacht Yard took out loans to cover the cost of the system. They did apply for grants to support the work, but they did not receive them (as can often be the case for businesses doing similar projects). While the up-front cost of the project was significant, the expected payback is nine to 10 years. After that, they’ll essentially get free power while continuing to practice and support environmentally responsible business operations.
Q&A WITH GABE PENDLETON
What is your connection with clean energy and environmental sustainability?
I originally went to law school and worked for a while as an attorney. I spent a lot of time working on environmental law issues, and one of my internships during law school was with the Maine Department of Environmental Protection. It’s an issue that’s important to me, and when I returned to Islesboro and Pendleton Yacht Yard, I kept that in mind. Yacht yards have the potential and reputation for environmentally negative impacts. Because of that, I wanted to do anything I could to minimize both our carbon emissions and pollution in general. I prioritize spending time on making sure we continue on the path of sustainability.
What were the steps to installing the solar array and battery system?
I know some people who worked at ReVision Energy, and I remember talking to them about the possibility of solar at the yacht yard. It wasn’t for another three or four years until we actually installed the arrays. A lot happened between the first time we floated the idea and the installation. We had to replace the roof so that wouldn’t be an issue in the future. We spent a lot of time discussing how to maximize benefits from solar power, and it all came down to peak shaving. ReVision had installed one system designed for peak shaving before, and when they looked at our graphs for our power usage, they were eager to try it again.
What’s peak shaving and how does that system work?
Peak shaving is flattening the curve of utility usage. We don’t have equipment that is on all the time with a constant draw of power. Our power usage comes in spikes—it’s when we’re working on projects. Shop tools are the big draw: table saws, metal lathes, and bright lights… everywhere you look, there’s power usage. Unfortunately, we can’t really tell our employees to wait until their coworkers are done with their machines so we don’t have a spike in utility usage. The machines are generally on at the same time, and then when we’re done working, everything is off.
It was these spikes that made up most of our electric bills. If we could take those spikes and flatten them into steady usage, we could rely solely on the power generated by our arrays. That’s why we installed the battery system that is fed by solar. Now we don’t draw from CMP (Central Maine Power) when we have those spikes, we draw from our own battery, and then the battery charges back up again during off peak times, mostly at night. We can even use the battery as an alternative to a gas-powered generator, so if the power goes out, we can use the battery to run our office. Even if the power stays out for a while on the island, the battery is still being charged by the panels, so it’s not depleting the whole time.
How do you keep a project like this affordable?
We applied for grants, but we were not awarded any. We went ahead with the project anyway and paid for it ourselves because it just made sense. We were looking at a relatively short payback on investment—just nine to 10 years—when considering the utility savings and tax benefits. It felt like any other capital expense: we thought, “Can we afford to do this?,” and when the answer was yes, we did it. And nine years after installation, we’ll just be getting free power.
On the front end, the cost is a lot. We are paying more per month on bank loans to pay off the cost of the infrastructure, but the bill from CMP is almost entirely gone. We could have stretched the loan longer to keep the cost of debt service roughly the same as our old power bills, but that would have meant we’d have to pay more on interest.
Essentially, if you’re going to be in business longer than the payment period on the loan, solar makes sense. It’s a long game, but it pays off.
What other energy saving measures have you taken at Pendleton Yacht Yard?
We work hard to make sure our buildings are well insulated. We use LED lighting when we can. When I first started, there weren’t any automatic door closers on the outside doors and people would leave them open and heat would just pour out the doors. I’m also a stickler for shutting the lights off when they’re not in use. Those little incremental things are the easy fixes, but the overall effect can be pretty big.
What happened after you installed the array? What were your findings?
It turned out that ReVision’s projections were correct, and we’re using almost exactly what we generate from solar within a given year. When we first put the array in, we were very careful because we were trying to get CMP to downgrade our service from Medium Commercial, Industrial General Service to SGS Small Commercial General Service (see CMP’s list of rates for more information) and eliminate peak demand changes. We wanted to avoid those spikes. We plugged in our electric cars at night so they didn’t use electricity at the same time as the shop tools. Soon after, we were downgraded in service. We’re now at the lowest level of commercial service for CMP, and our energy bills are close to nothing.
What’s your advice to other business owners who want to take on solar and/or an electric storage system?
One thing I learned is that it’s important to check your bills. After I had been receiving bills for a little while, I picked up on the fact that the energy costs were still too high. I was still seeing relatively large bills from CMP, so I contacted ReVision and asked if something was wrong with our service. It turned out that the meters were wired incorrectly, and we were getting charged for all of the electricity we generated with our panels. Thankfully, CMP corrected the error and reimbursed us for the overpayment.
Another piece of advice is when you’re doing projects like this, do it all at once. Anyone who works on boats could tell you that doing this piecemeal isn’t as effective as putting a system in all at once.
Lastly, you want to do a project like this at a time where you can maximize tax benefit. This varies depending many things, including company profitability during a particular year, changes in the tax code, and tariffs on things like solar panels.
Otherwise, my advice is to go for it. It’s good for public relations. It’s good for the planet. And generally speaking, it’s good for business. It’s a no-brainer regardless of whether you’re concerned about climate change or not. The bottom line wasn’t my motivating factor, but solar just makes financial sense.
Whether it’s profitable or not, it seems like the right thing to do, and it ought to be done. Every business has its own potential for environmental sustainability. Solar was the easy option for us, and it’s a good way for us to demonstrate our commitment to sustainability and environmental protection. We’re a boatyard; we sell gas and do things that might have a negative impact on the environment, but we are trying to do things to counteract that.
RESULTS
ReVision Energy installed 40 kW four-array system at Pendleton Yacht Yard at the end of 2017. They will be done paying off the loan in 2026 or 2027. Their electric bill has decreased from $700 a month to $15 a month basic delivery charge. Once the loan is paid off, the only cost to the system will be maintenance.
RESOURCES
- Pendleton Yacht Yard Website
- ReVision Energy website
- Efficiency Maine – Commercial and Industrial (C&I) Prescriptive Incentive Program
- Efficiency Maine – Commercial and Industrial (C&I) Custom Program
- Energy.gov – Funding opportunities and Tax credit information
Up-to-date Information on State of Maine regulations for offsetting electricity use through renewable energy projects:
The interview above has been edited for clarity and length.
