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| Owner Jim Sperlazza and General Manager Walter Redden |
No one should blame Jim Sperlazza for smiling. The owner of Five Star Auto Care in Rocklin, Calif., completed an extensive solar power project last October that he believes will power 90 percent of his facility’s carwash operation and provide a complete return on investment in 10 years. In addition, the project essentially enables Sperlazza to lock in today’s energy prices for the next 30 years.
The real kicker is that the project almost never got off the ground.
After attending a seminar on alternative energy about 1.5 years ago, Sperlazza was intrigued by the advantages solar energy could bring to his business. Not only could he improve Five Star’s environmental, social and community standing, Sperlazza saw solar power as a means to ultimately improve cash flow and lower operating costs.
“The whole pretense was that [alternative energy] could be a net-zero undertaking in that the monthly cost of the system would be covered by the reduction in utility costs,” notes Sperlazza.
That notion certainly raised his eyebrows. Sperlazza spent the next six months researching and speaking with vendors, but couldn’t find a solution that would provide more than 50 percent of his power needs. While that would have been a nice environmental boost, it was nowhere close to being the break-even proposition he sought.
In the meantime, the rebates generated by Pacific Gas & Electric (PG&E) for qualifying alternative energy purchases were going down.
“Every month I couldn’t find something to get done, the rebate was going to be less and less,” he explains. “I almost gave up. I was disappointed.”
Finally he spoke to a vendor, Solar Power Inc., that could meet his needs. While previous vendors had proposed placing solar panels on Five Star’s limited roof space, which could not house enough panels to reach Sperlazza’s power goals, Solar Power proposed building five carport structures along the facility’s entrance and exits that could provide shade, as well as house the solar panels. In addition, the plan called for replacing existing structures covering the wash’s vacuum and detailing areas.
Sold. The resulting $1 million project added nearly 8,500 square feet of shade structures that now serve as work shade and the company’s primary power grid. The 104-kilowatt photovoltaic system includes a whopping 612 solar panels. No panels were placed on Five Star’s rooftop.
“We’re at a point now where we should be able to produce on average, over the course of an entire year, about 90 percent of our needs,” beams Sperlazza. “We just got our first bill, and the only charge for the power was the transmission charge, which was about $19.”
Five Star Auto Care’s operation is extensive, offering not only a full-service hand wash but also fast lube, detailing and general auto repair. The company also is a certified smog check facility. The solar power supply does not cover the auto repair, which is housed in a separate building. Sperlazza says restrictions prevented the project from covering Five Star’s entire operation.
Still, he is more than pleased with the results. Before the solar panels were installed, Sperlazza says the company’s electric bill had been running about $5,000 per month. Once the project was complete, the auto repair’s power cost was about $800 and the utility cost of the carwash dropped to the $19 transmission charge.
The solar panels are designed to produce power for about 30 years, he says, which should enable the facility to continue to produce the vast majority of its own electricity 20 years after the system is paid for.
“What’s nice is we’ve locked in our cost of power at today’s rates,” explains Sperlazza. “Historically in California, the annualized increase for electricity is about 6 percent per year.” Using the rule of 72, Sperlazza says electricity costs are likely to double in about 12 years. “Ours will never change because we’re flat based on today’s rates,” he says.
Based on that scenario, Sperlazza believes the solar project will become “cash flow positive” in about six years, when the energy savings will outweigh the system’s lease payment.
From concept to completion, Five Star Auto Care’s solar project certainly was not easy, but Sperlazza credits the relationships he forged with his lenders and chambers of commerce for enabling him to structure a workable and beneficial deal for the business.
Although located in Rocklin, Five Star’s two-acre lot sits across the street from Roseville, so Sperlazza makes it a point to be visible and active in both cities’ chambers of commerce. It was a friend from one of the chambers that recommended Sperlazza attend the alternative energy seminar and ultimately convinced him to talk to the vice president of sales at Solar Power, who happens to be a county supervisor.
Similarly, the relationship Sperlazza enjoys with his bankers enabled him to structure the project through his normal lenders who teamed with a leasing company to structure the package the way he needed. Sperlazza