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SOLAR POWER DRIVES ROYAL PETROLEUM’S NEW HEADQUARTERS

36.6-Kilowatt DC Solar Energy System Provides Electricity for Commercial Fuel Supplier

SAN RAFAEL, CALIF. (May 26, 2004)–SPG Solar, Inc. (SPG) announced today the completion of a 36.6-kilowatt DC solar photovoltaic (PV) system for the Royal Petroleum Company headquarters in Santa Rosa, California. Royal Petroleum is the first commercial fuel supplier in the nation to be powered by solar energy. Royal supplies diesel fuel, gasoline and lubricants to commercial fleets in California’s Sonoma and Marin Counties, including wineries and farms, construction companies, and school bus and firefighting agencies.

SPG designed and installed the 36.6-kW PV system, composed of Sharp NT-185U1 photovoltaic modules and a PV30208 Xantrex inverter. The solar system is mounted on the corrugated metal roof of the Royal Petroleum headquarters building. Energy output from the solar system is monitored in real time by SPG’s SunSpot® photovoltaic monitoring system, which sends live energy generation data over the Internet to verify performance and return on investment.

“Royal Petroleum is the energy company of the future in Marin and Sonoma Counties, which is why we chose solar for our headquarters,” said Jim Dalton, president of Royal Petroleum. “The petroleum industry has to live down its past. Solar is clean energy, and the perception of Royal is the reality: we work on safety and running a clean operation.”

“It’s what you do in deeds that makes a difference, that turns around perception,” said Clif Hill, the chief operating officer for Royal Petroleum and Dalton’s partner. “Solar makes good business sense, too—the ROI is superb.”

“It’s a positive step forward for any petroleum company to install solar as their on-site power source,” said Dan Thompson, President of SPG. “ SPG’s partnership with Royal Petroleum will prove to be mutually beneficial to Royal, SPG, the environment, and the community. This is a great demonstration of a company doing its part for the environment that sends a positive message to the public about the petroleum industry.”

Royal Petroleum received a rebate for the solar system from the Self-Generation Incentive Program of PG&E, the local utility, administered by the California Public Utilities Commission. In addition to the rebate, Royal’s solar system qualifies for a 7.5% tax credit from the State of California, a property tax exemption and a federal 10% investment tax credit. The system is on an accelerated 5-year federal tax depreciation schedule for renewable energy.

“SPG is a one-stop shop, offering financing, coordination with the utility, and paperwork handling,” said Jim Dalton. “Businessmen don’t have time to fill out forms. SPG handles all the paperwork, which was a huge selling point for us.”

SPG engineered the 36.6 kW Royal Petroleum solar system to work within California’s net energy metering laws. Net energy metering, a benefit of the 1996 deregulation of the California energy system, requires public utilities to credit renewable energy producers for the electricity they send to the grid. Royal’s solar system is tied to the grid, and the building runs on electrical power from the utility when the sun isn’t shining. On sunny days the PV system sends surplus solar power back to the grid for use by the general public. The electric meter spins backwards and Royal Petroleum is credited by the utility for the power. Royal taps into the credit when it uses utility power at night or on rainy days.

“A petroleum company with solar is smart business,” said Jim Dalton. “We put energy back on the grid—when that arrow on the meter starts to point backwards, it’s a good feeling.”

Royal Petroleum’s solar system produces the equivalent power needed to supply 15 California homes. By generating its own electricity with sunlight, Royal Petroleum replaces this energy for use by others connected to the grid. The 36.6 kW system prevents 40 tons of carbon dioxide from being emitted into the atmosphere annually by a conventional California gas-fired power plant. It takes three acres of trees to filter this much CO2 from the atmosphere each year.

Royal Petroleum has three locations in Northern California, and offers fueling pumps that are accessible by a cardlock system that debits commercial customer accounts each time they fuel. Royal also continues to deliver fuel to select fleet customers. Royal Petroleum uses the popular “Flying A” brand, originally a consignee for J.P. Getty Oil in Sonoma and Marin before the introduction of franchises and oil company-owned filling stations. Getty absorbed Flying A in the early 60s, then sold it to Phillips. Phillips formed Royal Petroleum with three consignee partners, who retained the Flying A brand. The attractive new Santa Rosa headquarters, remodeled in 2002 and now powered by sunlight, was inspired by the strong colors and retro appeal of the Flying A logo.

How Solar Works

Solar energy systems consist of three components:PV panels, inverters and a performance monitor. PV panels convert sunlight into DC (direct current) electricity. The inverters change the DC into AC (alternating current), the same power supplied by electric utilities. The AC is distributed through a building’s electric service panel and flows to outlets, lights and switches. The performance monitor shows the amount of power the system is generating at any time to verify production.Solar is a clean and renewable form of electricity generation. PV systems generally have no moving parts (with the exception of solar tracking systems), is silent, runs all the time while the sun is shining, and produces zero emissions-air, ground or water.

About SPG Solar, Inc.

SPG is the industry's most experienced developer, designer, and installer of solar photovoltaic (PV) systems for homes, businesses, and large-scale commercial and government facilities. SPG's commitment is to build the highest-performing solar PV systems with the highest return on investment. The result is clean, reliable electricity that reduces or eliminates customers' electric utility costs. SPG has installed over 500 solar systems in California, including the Potrero Hill Head Start in San Francisco, and Westmont High School in Campbell, California. Major projects include the Vallejo Police and Fire headquarters, Vallejo, Calif., and the 520-kW system for the Sewerage Commission-Oroville Region. SPG is a licensed and bonded California General B, Solar C-46 and Electrical C-10 Contractor, License #759086.