The Proposed “Formula for Savings Disbursal”

The St Croix Reformed Church & Kingshill School Wind Turbine was created as a mission project.  Our goal is to inspire the community to embrace alternative energy, and redirect our savings towards the needs of the community.

Instead of paying our electric bill to VI WAPA every month, whatever the wind turbine saves us off our WAPA bill will be redirected into a special three part Wind Fund. This fund will be used for turbine maintenance and replacement, and to generate funds for energy-related improvements to the church, Kingshill School, and mission within the St Croix community.

2012 UPDATE:  

Due to the Hovensa Refinery closing -and the departure of a large number of families from the island, we chose to close our school. But the savings live on! 

The public schools on St Croix are financially strapped. So when the local elementary school down the hill from us needed a new copier, God’s Wind provided the answer.

Copier (1)-250x177

Below are the details from our original plan. We hope they are instructive to others as they consider how a Wind Turbine’s savings can help the community. With the closing of our school, our numbers will change, but the commitment will remain.

Based on current rates and school + church energy consumption, over the next 15 years we estimate the turbine will generate between $126,000 and $185,000 in energy savings. This is money which the church would have otherwise paid to VI WAPA. (Note: As part of its mission giving, the church has been paying the Kingshill School’s electricity bill).  Even WAPA benefits from our turbine as they don’t have to buy expensive fuel oil to produce what we use.

As our usage or the cost of electricity goes up, so will our contribution to the Fund, …the idea being that the church will continue to “pay” what any other resident would have to pay. But instead of paying WAPA each month, we will pay into our Wind Fund. Over the next year, we will post our usage, savings and payment information at this website.

The following “formula for disbursal” was approved by the Consistory as a guide. All figures are estimates. The formula was part of the grant proposal and will be revisited as real savings, cost, and experience accrue.

We estimate the Wind Turbine will generate approximately $700 a month in savings to the church. Rather than paying the electric company, the church will pay those savings into three funds on a monthly basis:

FUND #1:  Turbine Loan Repay

> Approximately $200/month. will be paid back to the Church’s Reserve Fund. $16,000 over approximately 82 months (7 yrs).

For the first 7 years of its operation, $200 a month in Wind savings will payback the loan from the church’s Reserve Fund.  Yes, we could have made it a “grant” from the Reserve Fund, but by using the wind to repay the Reserve Fund, those funds will be available for future mission needs. After the loan is paid back in year 7, the $200/month payback amount will be directed into the mission fund described below.

FUND #2:  Maintenance & Replacement Fund

> Approximately $250/month will be paid into Fund #2Total: $45,000 over 15 years. 

$250 per month paid into this fund will take care of maintenance needs, and eventually pay for the replacement of the turbine so that it can continue to generate funds for church mission.

Lifetime Maintenance Budget = $10,000; Turbine Replacement = $35,000.  At a rate of $250 per month saved into this fund, when the turbine warranty expires at the end of year 5 we should have $15,000 in the bank to pay for maintenance, and/or accrued towards eventual replacement. Replacement = turbine + inverter, and doesn’t include the tower or pad which should last a lot longer.

It could be assumed that replacement price might go down in 15 years due to increases in production and competition, but we are being moderate in our projection. This set aside will be adjusted as maintenance needs go up or down during the life of the turbine based on maintenance and replacement costs. Any savings from this set aside are to be earmarked for Fund #3.

FUND #3:  Wind Turbine Mission Fund:

> Approximately $250/month for the first 7 years will be paid into Fund #3, then $450/month**) Total: $64,500 over 15 years.

The Consistory has identified three primary recipients for Fund #3:

1. Additional Energy Saving Needs at the church

2. Kingshill School projects

3. Energy-related needs within the wider St Croix community that benefit individuals, mission organizations, and other churches.

These three are not in order of priority but are to be decided on an ‘as needed’ basis.

The amount going into this fund may vary month to month due to the variables of kilowatt usage and wind speed/turbine savings. If the church uses more energy and the turbine generates more savings, more money will go into this fund.

**During the first seven years of operation, we estimate the turbine will be able to generate $250 a month into the Turbine Mission Fund, in addition to Funds 1 and 2.  However, when the Reserve Fund loan of $16,000 is paid back after year 7, the $200/month used to pay back the loan will be ADDED to  Fund #3’s monthly payment, –taking Fund 3’s funding from $200 to $450 a month. And remember… built into Fund #1 is money to replace the turbine. This means that the NEXT Turbine will not need a loan from the Reserve Fund.

More About Fund #3:  The Wind Turbine Mission Fund

The underlying assumption of the Wind Turbine Project is that the church can afford its electric bill and that of the school’s, and that any savings from the Wind Turbine should not be “buried in the budget ground” (Matthew 25), but rather, intentionally invested towards mission. In that respect, the turbine and this plan acts as a creative reminder and source of new mission funds for the congregation.

Another underlying assumption is that the church’s electricity usage or cost per kilowatt may rise over the years, and thus, the amount of savings which the church will need to pay into the Turbine Funds should increase, as the point of the turbine is not to save our budget, but rather, allow us to redirect normal utility expenses towards the greater good. For example, if in the future we are zeroing out a $1000 WAPA bill, then the amount the church “saves into” the Turbine Fund should be $1000.

Yet another underlying assumption is that the church may need to increase or decrease allocations into any of the turbine funds, based on turbine maintenance and replacement expenses that may or may not incur.  Ideally, lower maintenance costs + longer turbine life expectancy = more money available for mission.

The Consistory will adjust, and disburse the turbine funds in keeping with these guiding principles and in light of our experience owning and operating a 10kw turbine.

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: