The city dedicated a 280-kilowatt solar photovoltaic system Thursday at a maintenance base yard in Halawa that will reduce its electricity bill by an estimated $138,000 a year.

The 1,188 PV panels installed at the city’s Department of Facilities Maintenance Halawa Corporation Yard will provide about 46 percent of the facility’s energy needs annually, or enough to power 64 typical Oahu households, according to a news release from the city.

The solar panels also provide shade for a parking area at the facility.

The city decided to buy the $2.2 million system outright rather than pursue one of several "no upfront cost" options being offered by some PV installation companies. In those arrangements, the PV companies pay for the systems and make their money back either by leasing the systems to the property owners or charging them for the electricity they use at a rate less than what they would otherwise pay their utility.

Because the city doesn’t pay taxes, it won’t be able to claim any state or federal tax credits that can significantly reduce the cost of PV systems for those with a tax liability.

Even so, the system is expected to pay for itself in 17 years at current electricity prices, city officials said.

The system has a 25-year warranty. The payback period will decrease if electricity prices go up.