Aaditya Saple

Massachusetts SREC-I Auction Throws a Curveball to the Markets: Here’s how this will impact SREC-II projects.

Photo courtesy NREL | http://www.nrel.gov/

Photo courtesy NREL | http://www.nrel.gov/

Massachusetts SREC-I Auction throws a curveball to the markets: What impact will this have on SREC-II projects.

Round II of the Massachusetts SREC-I clearinghouse auction failed to clear yesterday, July 30. A third round will be held on Friday, August 1st, 2014.

As we described earlier in an explanation of the Massachusetts SREC-I auction, This annual auction, which is based on the volume demanded, allows SREC sellers the opportunity to auction their SRECs at the end of each summer for a fixed price of $300/SREC, minus an auction fee (most customers will net $285).

Implications of the Massachusetts SREC-I Clearinghouse Round II

An Auction failing to clear Round II automatically increases the Renewable Portfolio Standard (RPS) obligation by 142,504 to 1,054,933 SRECs for compliance year (CY) 2015. An increase in demand generally pushes prices higher, which is what Sol Systems’ SREC trading team saw yesterday. Massachusetts SRECs with a 2015 vintage stamp increased $35 per SREC to $320 from $285. Since a partial clearance of the Auction is allowed in Round III, compliance entities and SREC investors are likely to bank some SRECs in expectance of this increase in CY 2015 RPS obligation. All unsold auction SRECs will be returned to the owners (with extended life of three years) in proportion to the clearance volume in Round III and will have to be sold on the spot market.

Read the rest of this entry »

Eric Scheier

What’s Better for a Homeowner: A Fixed Price Contract or a Brokerage Solution?

Since the birth of the first solar renewable energy credit (SREC) market, Sol Systems has distinguished itself from other SREC solution providers by offering customers the ability to lock into fixed price SREC contracts for a set amount of years. This provides customers with a guaranteed income stream for 3, 4, 5, or 10 years – and also mitigates the risk associated with volatile spot market, brokerage solutions.

Our fixed priced SREC contracts, also known as Sol Annuity, have allowed our installer network to build trust with their customer base by being able to guarantee a more predictable return on investment for homeowners. For example, a system owner may elect to sell SRECs to Sol Systems via a 5-year Sol Annuity contract for $175/SREC. This means that for the next five years, Sol Systems will purchase every SREC generated by that system for $175. If prices fall, customers are still guaranteed this fixed price.

Forward pricing can appear to be a raw deal, and pricing may seem low compared to current spot market values. That’s because the alternative compliance penalty (ACP), which acts as a price ceiling for SREC values, is set to decrease for each state’s renewable portfolio standard (RPS). The RPS is the legislation that creates the SREC markets through a solar carve-out.  For more information on the policy mechanisms that create state SREC markets, please visit our FAQ’s. Read the rest of this entry »

Aaditya Saple

Massachusetts DOER SREC Clearinghouse Auction is Underway, Here’s What You Need to Know.

The Massachusetts solar renewable energy credit (SREC) market is undoubtedly the most complex incentive program among its peers. Among its complexities is the annual clearinghouse auction mechanism, which allows SREC sellers the opportunity to auction their SRECs at the end of each summer for a fixed price of $300/SREC, minus any auction and aggregation fees (most customers will net around $271). Sol Systems can provide you with fixed forward pricing. Having a fixed forward price eliminates the need to enter the auction and deal with reminted SRECs. Right now, our 4-year pricing for SREC-I is $270. We offer 3-year, 4-year, 5-year and 10-year pricing for SREC-I and SREC-II. Sol Systems takes care of customer accounts throughout this process, thus allowing our customers to pursue their core business. For more information, email us today customer-service@solsystemscompany.com.

The first round of the SREC clearinghouse auction took place today and did not clear; 141,504 SRECs were deposited. Anxious SREC sellers are hopeful all SRECs will be cleared by the end of round two, which is to be held tomorrow, 30th July, 2014. It makes sense for auctions to enter Round II as an increase in the shelf life of SRECs is beneficial for both, compliance entities and SREC owners.

MA SREC Auction Mechanism

MA SREC Auction Mechanism

Read the rest of this entry »

Thomas Kinrade

A Sixth Yieldco Goes Public as the Asset Class Has its First Anniversary

Today TerraForm Power Inc. (TERP), a spinoff from SunEdison (SUNE), had its IPO making it the sixth yield corporation or “yieldco” to go public since NRG Yield (NYLD) became the first yieldco one year ago.  High dividend yields and rising stock prices have encouraged a wealth of investment in these new companies. However, investors should be aware of the differences that exist between yieldcos and longer term risks associated with the application of this new corporate structure to the power generation industry.

The yieldco structure is not new; the basic idea has been used in the oil & gas (MLPs) and real estate (REITs) industries for many years. In the power generation industry, yieldcos are formed in order to separate a company’s riskier development activities from the consistent cashflows that come from ownership of operating assets with contracted offtake.  The cash flows from these operating assets are distributed to shareholders as dividends that, at least to date, have higher dividend yields than those of a diversified equity portfolio.  For example, the six yieldcos profiled in the table below had dividend yields ranging from 3.0% to 7.5% at the time of their IPOs, compared to an average dividend yield of 1.9% for the S&P 500.  Dividend yields on yieldcos have dropped since their IPOs, but this is a function of the extremely strong performance of their stock prices.  Total returns, which include both price appreciation and dividends, have outperformed the S&P 500 over the past year (see table below). Read the rest of this entry »

Rachel Charow

Who Pays for Countervailing Tariffs on Chinese Solar Panels?

Tariffs on Chinese solar panels will raise the prices utility-scale projects and impact the distributed market.

Tariffs on Chinese solar panels will raise prices on utility-scale projects and in the distributed solar market.

On June 2, 2014, the U.S. Department of Commerce (DOC) made the decision to start implementing countervailing duties (“countervails”) on Chinese solar panels that will raise prices of commercial-scale and distributed solar projects. In 2013, 31% of all solar panels installed in the U.S. were Chinese modules. Within the distributed sector alone, the Chinese supplied the U.S. with more than 50% of panels installed. Seemingly, the $0.10 increase in price per Watt will have an effect on the distributed solar market, of which a large portion utilizes Chinese panels. However, utility-scale projects will experience a proportionally larger increase in price as shown by the Balance of System (BOS) model, thereby thinning profit margins.

Initially, Chinese modules were priced at $0.60-0.70 per Watt, however, according to GTM Research, duties of 19-35% will place approximately 14% of tax incidence on customers. As a result, they expect, and we have heard in the marketplace, a $0.10 increase in price to or slightly above $0.70 per Watt. This shrinks the gap between Chinese and U.S. panels, which cost about $0.90-1.00 per Watt.  Read the rest of this entry »

Thomas Larson

What Happens to Solar Panel Pricing after the WTO Ruling? Three Clarifications on the Dispute and its Implications

Although the WTO panel report addresses some problematic solar duties, deeper analysis shows that they are unlikely to heavily impact the U.S. module market.

On Monday July 14, the World Trade Organization (WTO) Dispute Settlement Body (DSB) issued a panel report to its members on a dispute between China and the United States involving solar panels and sixteen other products. Recent articles have declared the U.S. countervailing duties “illegal” as a result of the ruling, a misleading summary of what actually occurred. Deeper analysis shows that this case only addresses a small piece of the U.S.’s procedures behind calculating the duties, not the duties themselves, and does not demand immediate response from the U.S.

Although the case may have broader implications for U.S. trade policy as it seeks to fight anti-competitive behavior from China’s state-owned enterprises, it is unlikely to change much in the U.S. module market. Here are three important clarifications on the panel report for solar industry folks who want to know how it will affect panel pricing in the next twelve months. Read the rest of this entry »

William Graves

Will the Eagle Point Solar Decision Open Up the Midwest Solar Market?

Eagle Point Solar’s victory is a big win for rooftop solar in Iowa and opens up the state to further solar investment.

On July 11, 2014, the Iowa Supreme Court ruled in favor of Eagle Point Solar (EPS), a Dubuque, IA based solar installer, affirming that the company was not acting as a utility when it arranged a third-party power purchase agreement (PPA) with the city of Dubuque. The ruling caps a two year battle between rooftop solar and the two leading utilities in the state, MidAmerican Energy and Alliant Energy. With this decision, the Iowa court system clarified the status of behind the meter solar installations, and opened up the state to further solar investment.

The history of the case goes back to 2012 when MidAmerican and Alliant challenged Eagle Point Solar, stating that the firm’s arrangement with the city violated the utilities’ exclusive right to sell electricity within a given area or region.  The Iowa Utilities Board (IUB) sided with the utilities, issuing a Declarative Ruling which defined EPS as a public utility, and therefore unable to sell electricity in Alliant’s state-granted exclusive monopoly territory. Eagle Point Solar appealed the decision and it was subsequently reversed in 2013 by the Polk County District Court. Read the rest of this entry »

Natacha Kiler

July 2014 Project Finance Journal

This month's Solar Project Finance Journal includes info on the most competitive PPA rates, market developments in IL, RI, and SC, solar tariffs, and more.

This month’s Solar Project Finance Journal includes info on the most competitive PPA rates, market developments in IL, RI, and SC, solar tariffs, and more.

Below, we have included excerpts from Sol Systems’ July 2014 Solar Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list. Read the rest of this entry »

Natacha Kiler

Solar Property Tax Uncertainty & 3 Mitigation Strategies

Uncertainty about property tax treatments in some states is cause for concern

Apart from California, which extended its property tax exemption for solar power systems to 2025, the ambiguity around solar and property taxes looks like it may get worse before it gets better. Our team is financing projects in Arizona, Georgia, Indiana, Massachusetts, and New York which face varying degrees of uncertainty with regards to property tax treatments. As noted in our recent solar property tax issues blog , each state has different challenges and issues with regards to property taxes.

Arizona, the nation’s third largest solar market, is one such state. Arizona became a battle grounds for solar property tax disputes when the state’s Department of Revenue reviewed and reinterpreted a law that exempted rooftop solar from property taxes in cases when the systems are leased. Although third party investors are liable for the tax, solar leasing companies typically pass such taxes on to system lessees. Read the rest of this entry »

Erica Nangeroni

Rhode Island’s Second Solar Feed-in Tariff is Open for Enrollment. Here’s How to Apply

Rhode-Island-welcome2

The second 2014 open enrollment for the RI solar feed-in tariff will take place from July 21st to August 21st.

The second round of the 2014 enrollment in Rhode Island’s feed-in tariff program has been announced by National Grid, Rhode Island’s electric utility. The feed-in tariff is part of the state’s Distributed Generation Standard Contracts program, established in June 2011. The program awards long-term standard contracts to eligible distributed generation facilities for the purchase of energy, capacity, and RECS over a 15 year term. Upon establishment, the program called for 40MW of renewable energy procurement by the end of 2014. The program has reached 25 MW since it’s start, leaving 15MW of nameplate capacity available for the remainder of the 2014 program year, with a third enrollment scheduled for the fall in October or November.

The proposal period is scheduled to run from July 21st to August 1st. For each enrollment period, ceiling prices and capacity targets are set by the Distributed Generation Standard Contract Board, as can be seen in the table. All projects require a competitive bid price at or below the applicable ceiling price.  However, projects will also be evaluated using non-price criteria including site control and permitting, the ability to develop, finance, and construct in 18 months, technical and engineering aspects, energy resource plans, and project management experience. Price criteria vs. non-price criteria will be weighted 80:20, respectively. Categorized according to technology and size, renewable projects including wind, solar, and anaerobic digestion are all eligible for the program.

Read the rest of this entry »

Natacha Kiler

3 Noteworthy Solar Implications in New National Electrical Code

This year's National Electrical Code has come out and includes a requirement for solar energy systems to have a "Rapid Shutdown" function.

This year’s National Electrical Code has come out and includes a requirement for solar energy systems to have a “Rapid Shutdown” function.

The 2014 National Electrical Code (NEC) has come out, and this version holds a bit of solar intrigue even for those who are not involved with engineering or construction.  In response to safety concerns for first responders, like firefighters, the 2014 NEC now requires solar energy systems to have a “Rapid Shutdown” function.  In simple terms, the requirement carries 3 interesting implications:

(1) Rooftop systems will need design and technology adjustments.

(2) There is newly created demand for niche safety products from PV technology manufacturers.

(3) The requirements will add some minimal costs to rooftop systems. Read the rest of this entry »

Erica Nangeroni

Employee Spotlight: Ben Margolis

This month's employee spotlight features Ben Margolis from our project finance team.

This month’s employee spotlight features Ben Margolis from our project finance team.

At Sol Systems, our team is our number one asset. Their dedication and passion for bringing creative financing solutions to the solar industry are essential to our company’s success. Our company has experienced a lot of recent growth, and we are proud to employ some of the brightest talent in the renewable energy industry. We were able to sit down with Ben Margolis, who has been with Sol Systems for a little over a year and serves as a Director of Project Finance, to hear about his experience.

Has Sol Systems changed since you first started here?

Since I started, we’ve added construction and term debt for solar projects, and we have grown the project finance group and project finance offerings; change in market place has shifted our approach to the market and forced us to adapt, and it’s all been very interesting to be a part of.

What attracted you to work at Sol Systems?

The people. Sol Systems is a great place to work because of the team; it’s exciting and interesting. As a company, Sol Systems has the right people and the right team and is well positioned in the marketplace to succeed.

Read the rest of this entry »

Colin Murchie

Beyond the Meter: Remote Solar on the Horizon?

A Less-Than-Totally-Addressable Market

Commercial solar can be an extremely difficult, uphill sell. Not only must a salesperson overcome traditional customer barriers of ignorance, indifference, or fear, with a product that can seem formidably technical, but they have to do so in what is to date an inordinately small addressable market. Consider a Venn diagram, but one where you must intersect a highly creditworthy client, with a large-enough-to-bother roof, such roof being fairly new (but not covered with mechanical equipment), with some spare structural capacity; generally, commercial instead of industrial electricity rates, low shading, a PPA-friendly state, and one of the markets that makes sense for solar this quarter. In considering all of this, you’ve no longer got a Venn diagram; you’ve got something else entirely.

Remote solar could allow for greater utilization of ideal project sites and a larger set of potential customers reaping the benefits.

It’s part of the reason solar developers like to press their nose against the glass as their plane comes in over the big flat roofs on the warehouses next to the airport and dream of what might be.

Of course we should pursue such low hanging fruit where we can find it – and keep in mind that some finance providers are more innovative on host credit than others.

However, there are only so many big retailers and Fortune 500 distribution centers out there. Great credit often comes with truly challenging host sites and vice versa.  Further, we’ve seen other issues with over-concentration.  In certain substations serving Southern New Jersey office parks, we’ve seen interconnection study results that look like all Three Stooges trying to fit through a door at the same time.

Read the rest of this entry »

Erica Nangeroni

Sol Systems to Speak at Intersolar North America in San Francisco

intersolar picSeveral members of the Sol Systems team will attend the Intersolar North America conference in San Francisco next week from July 7-9. Sol Systems’ CFO, George Ashton will share Sol Systems’ experiences financing commercial solar projects on the panel entitled The DG Future – the ITC, Cost-cutting & Positioning Yourself for Ever Changing Incentive Regimes. To date, Sol Systems has facilitated financing for approximately 100 MW of solar projects throughout the United States and has another 84 MW at term sheet. Sol Systems finances DG solar projects through a combination of its tax structured investments, construction and term debt offerings, project purchases, and solar renewable energy credit (SREC) solutions.

Several members of the Sol Systems team will be in San Francisco to meet with developer clients to discuss their solar financing needs. To meet with Sol Systems in San Francisco, please contact our team at info@solsystemscompany.com.

Read the rest of this entry »

Erica Nangeroni

Sol Systems Welcomes Summer Interns

Sol Systems welcomes four interns for the summer.

Sol Systems is excited to welcome, from left to right, Erica Nangeroni, Rachel Charow, Thomas Kinrade, Aaditya Saple, and Julia Heckmann (not pictured).

At Sol Systems, our number one asset is our team. We are proud of our internship program which provides young people with an opportunity to launch a career in renewable energy. This summer, we are excited to welcome Rachel Charow, Julia Heckmann, Thomas Kinrade, Erica Nangeroni, and Aaditya Saple to our team.

Read the rest of this entry »

Sara Rafalson

Washington Gas Energy Systems, Sol Systems, and Partners Unveil 1.23 MW Maryland Solar Project

Sol Systems financed this 1.23 MW Maryland solar energy project in partnership with Washington Gas Energy Systems.

Sol Systems financed this 1.23 MW Maryland solar energy project in partnership with Washington Gas Energy Systems.

Presbyterian Senior Living unveiled its 1,230-kilowatt (kW) solar array at Glen Meadows Retirement Community in Glen Arm, Md. in a ribbon cutting ceremony with representatives from Washington Gas Energy Systems, Inc., ABM, Building Energy, Sol Systems, and Clark EcoEnergy. The ground-mounted solar array will be owned and operated by Washington Gas Energy Systems under a 20-year power purchase agreement.

Sol Systems acted as investment advisor to Washington Gas Energy Systems in the transaction. Sol Systems originated the project opportunity from Building Energy, an Italian-based independent power producer. Building Energy developed the project opportunity through a joint venture with ABM, which handled the engineering, procurement and construction.

“We are committed to streamlining the investment process for distributed generation solar projects such as the one at Presbyterian Senior Living,” said Yuri Horwitz, chief executive officer of Sol Systems. “The Sol Systems team is proud to work with a financing partner like Washington Gas Energy Systems to drive investment into the mid-sized commercial solar market at Glen Meadows Retirement Community and similar facilities across the country.” Read the rest of this entry »

Erica Nangeroni

2014 Delaware Procurement Program Solicitation Results in Surprisingly Higher Pricing than 2013

On May 28, 2014, the results for the 2014 SRECDelaware Procurement Program were announced. This is the second year that the newly structured program has been in place; the Delaware Public Service Commission approved the new structure of the program in 2013, which implemented a competitive bid process for all tiers for the first 7 years of the contract and a set price of $50/SREC for the remaining 13 years of the contract. However, with the 2014 program, the set price for the remaining 13 years of the contract has decreased to $35/SREC. The 2012 Pilot Program that preceded the current Procurement Program differed in structure, with administratively set prices at $260/SREC for years 1-10 and $50/SREC for years 11-20 for projects under 250 kW and a competitive bidding process for anything larger. In 2013, the competitive Procurement Program resulted in lower SREC prices for successful bidders, as compared to the administratively set Pilot Program. In 2013, SRECDelaware also held a Spot Market Auction for owners of existing SREC’s generated since July 2009, which additionally produced low SREC prices.

Read the rest of this entry »

Natacha Kiler

Evolution at Work: Utility Dinosaurs, Solar, & New York’s REV

In the last decade or so, many utilities have demonstrated a “fight vs. flight” response toward solar energy and distributed generation.  Some utilities have lobbied against solar and created regulatory roadblocks, while a greater majority of utilities ignored the solar industry – because it was relatively small and insignificant. But as the solar industry has matured and increased in size, and climate change has become a more pertinent issue, the U.S. electricity landscape is facing the precipice of a major evolution. Many utilities are demonstrating an evolutionary response and adapting to the changing energy landscape. As described in an excellent report by Bloomberg New Energy Finance’s “Fight, flight or adapt:  How are US utilities coping with distributed PV,” there are a variety of business models that utilities are employing.  These include:

a.  Utilities who build and own distributed PV within their own service territories through regulated arms

b.  Utilities who build and own distributed PV outside their service territories through unregulated arms

c.  Utilities who invest tax equity, or an equity stake in PV portfolios

d.  Utilities who purchase PV projects/portfolios that are developed by others

e.  Utilities who invest in DG related technologies, such as grid enhancements and storage, and

f.  Utilities who partner with distributed PV companies to provide services such as lead generation, installation, O&M, and billing Read the rest of this entry »

Sara Rafalson

Sol Systems CEO Yuri Horwitz Named Regional EY Entrepreneur of The Year™ 2014 Award Winner

Sol Systems' Yuri Horwitz wins the 2014 Entrepreneur of the Year award.

Sol Systems’ Yuri Horwitz wins the 2014 Entrepreneur of the Year award.

EY today announced that Yuri Horwitz, CEO of D.C. based solar finance firm, Sol Systems, received the EY Entrepreneur Of The Year™ 2014 Award in the emerging technologies category in Greater Washington. The award recognizes outstanding entrepreneurs who demonstrate excellence and extraordinary success in such areas as innovation, financial performance, and personal commitment to their businesses and communities. Mr. Horwitz was selected by an independent panel of judges, and the award was presented at a special gala event on Thursday, June 19, 2014 at The Ritz-Carlton, Tysons Corner.

Mr. Horwitz was recognized for his leadership in tackling the solar industry’s greatest financing challenges. Sol Systems represents investor clients such as utilities, banks, insurance companies, and Fortune 100 companies and places capital into solar energy assets on their behalf. “If we can harness dreams, we can accomplish anything. But first, we need to create a vehicle to get there,” said Mr. Horwitz during his acceptance speech on Thursday night. Read the rest of this entry »

Erica Nangeroni

Sol Systems to Speak at PV America Conference in Boston

Sol Systems will speak at the PV America 2014 Conference in Boston.

Sol Systems will speak at the PV America 2014 Conference in Boston.

The Sol Systems team will attend the PV America 2014 Conference in Boston, MA next week from June 23-25. Sol Systems’ CEO, Yuri Horwitz is the conference’s finance chair this year and will speak on a panel entitled The Future of Solar Financing & Challenges Ahead at 1:30 PM in room 153. Sol Systems will also host a cocktail reception with Hannon Armstrong, our partner on a $100 million solar debt fund that addresses financing challenges in the commercial and industrial (C&I) solar sector.

Several members of the Sol Systems team will be in Boston meeting with developer and investor clients. To meet with Sol Systems in Boston, please contact our team at info@solsystemscompany.com. Read the rest of this entry »

Natacha Kiler

Summary of the Clean Power Plan & Positive Impacts on the Solar Industry

At the direction of President Obama, the U.S. Environmental Protection Agency released the Clean Power Plan, also known as 111(d) on June 2.  It is the first time the U.S. government has sought to cut carbon pollution from existing power plants.  In summary, by 2030, the EPA’s proposed steps should cut national carbon emission from the power sector by 30% – as measured against 2005 levels.

The proposal provides guidelines for states to develop plans to meet state-specific goals to reduce carbon pollution and gives them the flexibility to design their own programs. States can choose a mix of generation using diverse fuels, energy efficiency, and/or demand-side management. States can also choose to work alone to develop individual plans or with other states to develop multi-state plans.

Ultimately, as we look into our crystal ball, we see a large increase in the number of rate cases that utilities bring before their state’s Public Utility Commissions, and subsequent changes in the way utilities are regulated. We also see the following positive impacts for the solar and energy efficiency industries: Read the rest of this entry »

Rachel Charow

New York Looks to Become a Shared Energy State

New York aims to expand its solar market by introducing shared solar.

New York aims to expand its solar market by introducing shared solar.

On June 3 the New York Assembly Energy Committee approved the Shared Clean Energy Bill A9931/S7727, continuing the momentum that New York has built up in the solar industry. In late April, Governor Andrew Cuomo committed $1 billion in funding to continue the NY-Sun solar program, which aims to increase solar power tenfold in New York by 2023. New York solar power is expanding by enabling families, schools, businesses, and renters alike to come together and hold a share in local, community solar projects.

Sponsored by Energy Committee Chair and Assemblywoman Amy Paulin, the Shared Clean Energy Bill aims to open up renewable energy production on a community scale. Those normally prohibited from participating in solar production such would gain access to cleaner energy. What’s more, the health and environmental benefits come at an appropriate time, jibing well with Obama’s carbon emissions reduction law. There is no major opposition to this bill; the main obstacle appears to be time, as the legislative session closes today: June 19. Should the bill not make it to the floor of the Assembly and Senate today, the bill will be reintroduced at the start of the next session.

Read the rest of this entry »

Erica Nangeroni

Ohio Becomes the First State to Freeze its Renewable Portfolio Standard

The passage of Senate Bill 310 (SB310) has frozen Ohio’s Renewable Portfolio Standard until 2017, making Ohio the first state to roll back renewable energy and efficiency measures.

The passage of Senate Bill 310 (SB310) has frozen Ohio’s Renewable Portfolio Standard until 2017, making Ohio the first state to roll back renewable energy and efficiency measures.

With the signing of Senate Bill 310 (SB 310), Ohio has become the first state to “freeze” its Renewable Portfolio Standard (RPS). Ohio Governor John Kasich signed the bill into law on June 13th, effectively halting the state’s mandates for efficiency and renewables until 2017. Come 2017, these mandates will pick up where they left off when the freeze occurred, as opposed to the annual increases in renewable energy and efficiency measures that would have occurred with the RPS.

SB310 will significantly harm Ohio’s solar industry by driving SREC prices down in both the Buckeye state as well as the surrounding states such as Kentucky, Pennsylvania, West Virginia, Indiana, and Michigan that sell their SRECs into Ohio. The bill faced tremendous opposition from health and environmental coalitions, as well as a group of 70 businesses and organizations, including Honda and Whirlpool, who urged Governor Kasich not to sign the bill.

Read the rest of this entry »

Natacha Kiler

2014 U.S. Solar Projects Face Greatest Hardships in the Chinese Trade Case

Here's how new tariffs on Chinese module manufacturers will affect solar project finance deals in 2014.

Here’s how new tariffs on Chinese module manufacturers will affect solar project finance deals in 2014.

In the first week of June, the U.S. Department of Commerce (DoC) announced its decision to levy tariffs ranging from 18.5-35% against Chinese solar manufacturers such as ReneSola, Suntech, Trina Solar, and Yingli as countervailing measures against Chinese subsidies for solar products. The DoC enacted the duty after deeming that such subsidies give Chinese solar manufacturers an undue advantage over competing domestic firms (such as SolarWorld).

From our team’s perspective, the trade tariff is most taxing for U.S. developers and investors who are trying to finance solar projects in Q3 and Q4 of 2014. Earlier this year, solar panels could be procured at a cost of $0.60-0.70/Watt, but now, panel prices are more likely to be procured at a cost of $0.70-0.80/Watt. The tariff falls hardest on (1) those who have projects with thin profit margins, and (2) those who have previously negotiated prices for Chinese panels, but who have not actually purchased the equipment. In addition to the cost impact, many project developers and EPC’s are now without a secure supply of modules and must now actively shop for them. This can wreak potential havoc for delivery risk with respect to project schedules. Read the rest of this entry »

Aaditya Saple

Massachusetts Proposes New Solar Policy…Again

Massachusetts proposes new solar policy...again. The new proposal is a compromise to address net metering and the SREC market.

Massachusetts proposes new solar policy…again. The new proposal is a compromise to address net metering and the SREC market.

Less than two months after Massachusetts unveiled the SREC-II solar incentive program, big utilities and developers are back at the table to push for a new deal. Stakeholders congregated at the Federal Reserve Bank of Boston on Wednesday, June 11th, to broker a stable and sustainable agreement addressing the state’s two biggest policy incentives: net metering and the Massachusetts solar renewable energy credit (SREC) market.

The Massachusetts Department of Energy Resources (DOER) led the negotiations among the Solar Energy Industries Association (SEIA) and the state’s dominant utilities, National Grid and Northeast Utilities. The meeting resulted in a compromised agreement that will hopefully be translated into proposed legislation to be presented to the TUE Committee. Read the rest of this entry »

Natacha Kiler

June 2014 Solar Project Finance Journal

This month's Solar Project Finance journal includes updates on the hottest solar markets, solar tariffs, 111(d), and the most competitive PPA rates.

This month’s Solar Project Finance journal includes updates on the hottest solar markets, solar tariffs, 111(d), and the most competitive PPA rates.

Below, we have included excerpts from Sol Systems’ June  2014 Solar Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list. Read the rest of this entry »

Sara Rafalson

Sol Systems Welcomes Joe Song as Senior Director of Investment Analysis

Sol Systems is proud to welcome Joe Song to the team.

Sol Systems is proud to welcome Joe Song to the team as Senior Director of Investment Analysis.

Sol Systems today announced the appointment of Joe Song as Senior Director of Investment Analysis.

At Sol Systems, Joe Song oversees technical diligence for Sol Systems’ solar project investments, supporting the tax equity, take-out and debt financing products that Sol Systems provides to the North American solar market. He also manages the construction process, structuring the project management and owner’s agent roles that Sol Systems provides to ensure the solar investments are built to specification. Mr. Song also works with developers to optimize projects so that they achieve benchmarks for financing and supports efforts to introduce new capital to the solar market.

Mr. Song joined Sol Systems after spending the previous 4 years working as an independent consultant for solar financing companies, management consulting firms, and the Department of Energy. Previously,  he spent six years working as Director of Design & Engineering for SunEdison, where he built an internal engineering team who supported the construction of over 150 megawatts of solar projects. Mr. Song is also an adviser to SunFarmer, a non-profit solar financing company deploying solar for hospitals in Nepal. Read the rest of this entry »

Anna Noucas

Will Ohio be the First State to Freeze its Renewable Portfolio Standard?

. If successful, Senate Bill 310 (SB 310) would significantly harm Ohio’s solar industry, which has created 3,800 jobs and made Ohio #8 in the country in terms of renewable energy job creation.

. If successful, Senate Bill 310 (SB 310) would significantly harm Ohio’s solar industry, which has created 3,800 jobs and made Ohio #8 in the country in terms of renewable energy job creation.

In the past two years, Ohio legislators have twice introduced legislation to repeal the state’s Renewable Portfolio Standard (RPS). After many unsuccessful attempts, the anti-renewables lobby is finally making progress with new legislation to “freeze” the state’s RPS. If successful, Senate Bill 310 (SB 310) would significantly harm Ohio’s solar industry, which has created 3,800 jobs and made Ohio #8 in the country in terms of renewable energy job creation. The legislation would also discontinue the Buckeye state’s solar renewable energy credit (SREC) market, thereby discouraging further homeowners and businesses from building and financing solar and other renewable energy projects. These alterations to the RPS would also affect solar customers in states like Indiana, Michigan, Pennsylvania, West Virginia, and Kentucky who sell their SRECs into the Ohio market.

Read the rest of this entry »

Natacha Kiler

Solar Storage: From Geeky Pipe Dream to Reality

Solar energy systems with energy storage can provide electricity back-up, frequency regulation to the grid, and offset energy usage.

Solar energy systems with energy storage can provide electricity back-up, frequency regulation to the grid, and offset energy usage.

Among solar geeks, solar storage has long been an interesting topic of discussion, and one with (at least) a three-pronged value proposition. First, solar energy systems with energy storage can provide electricity back-up to the host in the event of a grid-outage. Second, storage may provide an opportunity to offset energy usage at the customer site, capacity and demand charges. Finally, and perhaps the most exciting, solar-based storage systems can provide frequency regulation to the grid, enabling the grid to operate on the 60 Hz “hum” or “heartbeat” that keeps the grid in sync.

Until now, these value propositions have not outweighed the great cost of battery storage, but market-based factors, business innovations, and technical developments in energy storage and PV technology are making storage more realistic than ever. Indeed, there seem to be a few markets where solar energy storage may be successfully built in the near term. For very different reasons, we expect to see more solar storage projects in California, Hawaii, New York, and the PJM region in the near future. Read the rest of this entry »

Natacha Kiler

When Solar Property Taxes Get Personal

Property taxes are a frequently issue for solar project development. The presence, or lack, of a property tax on a solar energy system has significant implications for a project’s profitability.

Property taxes are a frequently issue for solar project development. The presence, or lack, of a property tax on a solar energy system has significant implications for a project’s profitability.

On the long and winding road of solar project development, property taxes are frequently an afterthought. Yet, the presence, or lack, of a property tax on a solar energy system has significant implications for a project’s profitability. According to SEIA, 38 states in the U.S. have property tax exemptions for solar, and there are more states that are pushing them forward (most recently Colorado). However, property tax exemptions are nuanced, often with different treatments for personal property (business equipment such as tools, fixtures, and vehicles) and real property (land and buildings).

This can sometimes mean that solar energy systems and third-party financing arrangements will not qualify for the exemptions. Moreover, there are some solar markets where property tax exemptions are individually negotiable – but not definite. Georgia and Massachusetts are two examples.

In Georgia, legislative efforts and utility programs have sought to increase solar development. Despite these efforts, project margins remain very tight because of low PPA rates. In addition, the state relies on property taxes (not sales tax or income tax) to generate much of its income, which means solar projects face the additional burden of real property taxes. As a result, we have seen cases where a “good” project’s viability hinges on the project’s tax treatment. Read the rest of this entry »

Sara Rafalson

Will the Panel Price Bump be a Q3 Solar Deal Breaker?

Solar panel prices are trending up.

Solar panel prices are trending up.

Panel prices are trending up. Depending on module make, model, and the order size, the increase looks to be somewhere to the tune of 6-8 cents per watt, or a cost of 70-75 cents per watt for projects that will be built in Q3 of 2014.

The price bump may be attributed to the U.S.-China trade dispute, which has yet to be resolved. The continued delay in the international trade tariff decision has created urgency for panel suppliers to move modules, leading to material price increases. The price bump may also be the result of some module suppliers using the dispute to raise prices. If module tariffs related to the trade dispute do indeed move forward, the solar panel price surge could kill many solar deals.  Although the module price bump is impacting near-term solar projects, we see it as a temporary spike. Read the rest of this entry »

Natacha Kiler

May 2014 Solar Project Finance Journal

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

This month’s Solar Project Finance Journal includes info on the most competitive PPA prices, developments in Connecticut, Hawaii, Massachusetts, and New York, and information on the importance of inverter choice, an update on our construction and term debt offerings, EPA’s upcoming rulings on greenhouse gas emissions, and more.

Below, we have included excerpts from Sol Systems’ May 2014 Solar Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list.

Project Finance Statistics

The following statistics represent some high-quality solar projects and portfolios that we are actively reviewing for investment.

Capacity: 200 kW – 37 MW
Average Capacity:  5.2 MW

Developer all-in (asking) prices*: 

  • <500 kW:  $2.60-3.00/Watt
  • 500 kW–2 MW:  $1.85 – 3.20/Watt
  • >2 MW:  $1.60-3.00/Watt

Read the rest of this entry »

Jessica Robbins

New York Launches New Incentive Round for Large Solar Projects

The New York State Energy Research and Development Authority (NYSERDA) unveiled a new funding program for solar systems over 200kW in size.

The New York State Energy Research and Development Authority (NYSERDA) unveiled a new funding program for solar systems over 200kW in size.

New York is in a solar state of mind. On the heels of the recent announcement to commit an additional $1B to New York solar incentives over the next decade, the New York State Energy Research and Development Authority (NYSERDA) unveiled the next anticipated funding program for large solar systems, over 200kW in size. This round of funding closely resembles previous offerings, and does not appear to be part of the “megawatt block” structure highlighted in the April announcement. PON 2956 (short for Program Opportunity Notice) went live this week, promising $60M in available incentives or more, to be awarded at NYSERDA’s discretion. Applications are due July 17th, 2014 and all systems must come online by April of 2016.

Changes from Previous NYSERDA Large Solar Incentives

Unlike past PONs for large projects, all New York Independent System Operator (NYISO) load zones are in play. Several favorable tweaks to this year’s program, compared to earlier New York solar incentive rounds like PON 2860 and 2589 in the past, indicate a willingness on NYSERDA’s part to see this program drive more project development this year than ever before. In previous PONs for large projects, awardees received the full incentive amount in five payments – 30% at project completion paid out in two upfront installments, and 70% paid out as a PBI split between the first three years of production. PON 2956 will see that 30% upfront payment occur in one installment instead of two, and the remaining 70% condensed to only two years’ worth of production, paid at year’s end. The incentive for any project cannot exceed 50% of project installed costs. Read the rest of this entry »

Victoria Ngare

How Third Party Financing Can Be a Growth Strategy for Commercial Solar Developers

Third party financing allows developers to do what they do best, develop projects and build relationships with hosts.

Third party financing allows developers to do what they do best: develop projects and build relationships with hosts.

The solar industry has experienced tremendous growth over the past few years. In the early 2000s, the industry was composed of a few specialized players. With the growth of federal and state level incentive programs as well as innovations in financing, more players entered the space. Programs like the 1603 Cash Grant allowed developers and those that did not have access to tax equity to enter the commercial solar space in a meaningful way by offering Power Purchase Agreements (PPAs). But as stocks of safe-harbored modules dwindle, more of these developers are pursuing PPA financing partners as well as external tax-equity.

With third-party financing developers originate, permit and build the project with the assurance that an investor will buy the project at COD. In some cases a developer will package the project and sell it once the project is “shovel ready” to an  investor to build and own. Under this structure, a developer sells the asset outright and receives payment at COD or through milestone payments during construction.  By spending more time developing project pipeline, developers can build up sales and therefore tax appetite. Eventually they can take advantage of the ITC and look to re-invest the capital in owning projects and actively investing in other projects as well.  Lastly, as the industry consolidates, developing more projects can be a strategy to demonstrate increased value.  The more project pipeline and development experience a developer has the more valuable he becomes to a potential investor or buyer.

Read the rest of this entry »

Thomas Larson

Cashing in on Solar’s Hidden Value

Solar and Battery

Batteries may first enter the solar space in demand charge reduction.

The solar value proposition remains very attractive to homeowners and facility managers across the United States. However, the industry sells itself with one arm tied behind its back…

From a consumer’s perspective, there are two key pieces of energy demand—capacity and cumulative usage. Many utility bills are comprised by 1) a demand charge, set by measuring the customer’s most energy intensive hour within a given billing period, and 2) marginal energy use, which is simply the per kWh rate with which the solar crowd is fairly familiar. While solar can predictably reduce overall energy drawn from the traditional utility over a given period, it remains more difficult to predict and quantify its reduction in peak demand for consumers. In short, solar has yet to add capacity to its appeal in predictable, scalable forms. However, capacity can be added to solar’s arsenal through a combination of technological and financial innovations.

Read the rest of this entry »

Sara Rafalson

Sol Systems’ CEO Yuri Horwitz Named Finalist for Ernst and Young’s Entrepreneur of the Year

Sol Systems' CEO Yuri Horwitz was named as a finalist for Ernst and Young's Entrepreneur of the Year for the Washington Area.

Sol Systems’ CEO Yuri Horwitz was named as a finalist for Ernst and Young’s Entrepreneur of the Year for the Washington Area.

Sol Systems is pleased to announce that CEO Yuri Horwitz has been named a finalist for Ernst and Young’s 2014 Entrepreneur of the Year award. The Entrepreneur of the Year award is recognized as one of the nation’s most prestigious honors for the country’s most innovative business leaders. Finalists have demonstrated excellence and extraordinary success in such areas as innovation, financial performance, risk and personal commitment to their businesses and communities.

Yuri was named a finalist for the Washington Area region. Winners will be announced on June 19, 2014, at which point regional award winners will advance to the next round and be considered for the national Entrepreneur of the Year awards program. Read the rest of this entry »

Julia Heckmann

Sol Systems Speaks at 2nd Annual Sunshine Backed Bonds Conference in New York

George Ashton and Daniel Yonkin will speak about financing alternatives and tax equity in the solar energy space.

George Ashton and Daniel Yonkin will speak about solar financing and tax equity in New York today.

Sol Systems’ CFO, George Ashton, and Director of Tax Equity, Daniel Yonkin, are speaking at the 2nd Annual Sunshine Backed Bonds conference in New York today.

Mr. Ashton will participate in a panel discussion on options and considerations for lowering the cost of capital for renewable energy. Panelists will focus on current financing alternatives available to solar developers and provide an outlook for the role of securitization in the solar space.

Mr. Yonkin will speak on a panel detailing tax equity and accounting considerations in the asset-backed security field. The panel will provide updates on tax equity structures, discuss the friction points between tax equity and securitization, and explore options for resolving these frictions.

Read the rest of this entry »

Jessica Robbins

New York Commits Another $1 Billion to Solar. Here’s What You Need to Know.

Will New York join Massachusetts and California as an enduring solar state?

Last Thursday, New York Governor Andrew Cuomo announced an additional $1 billion in funding for the NY-Sun initiative, making good on his promise to extend the program through 2023. The funding announcement includes an overhaul of New York State Energy Research and Development Authority’s (NYSERDA) current incentive program, previously doled out through Program Opportunity Notices (PONs) with varying availability for different solar project sizes and geographies. The new program will take effect June 1st.

With this new initiative, solar should remain a crucial part of the Empire State’s energy portfolio

New York Solar Incentives Explained

The NY-Sun initiative, founded in 2011, coordinates solar programs between the Long Island Power Authority (LIPA, now PSEG Long Island), the New York Power Authority (NYPA), and NYSERDA. The new program, called “Megawatt Block”, will break out MW capacity allocations to specific regions of the state, and then further break down target capacities in each block. Solar incentives in New York will be awarded on a per watt basis for residential PV (up to 25 kW), small PV (non-residential up to 200 kW), and large PV (over 200 kW). Similar to the popular California Solar Initiative rebates, prices will step down as capacity blocks in each region and sector are filled, allowing the market to grow at a steady pace and eventually stand on its own. If the geographic preference follows the earlier program, we can expect to see preference given to areas downstate near New York City.

Read the rest of this entry »

Sara Rafalson

We’re Hiring! Sol Systems Seeks Director of Marketing

Interested in joining the Sol team? We are currently hiring for a Director of Marketing.

Interested in joining the Sol team? We are currently hiring for a Director of Marketing.

Sol Systems is seeking a Director of Marketing to help us expand our growing team and business and lead our Marketing Department.

Sol Systems attracts the best and the brightest. We have built a dynamic, entrepreneurial and capable team dedicated to the important mission of reducing the human ecological impact through the financing, development, and management of distributed generation energy assets.  

We change the world. We invite you to join us.

Apply today to be Sol Systems’ next Director of Marketing.

Read the rest of this entry »

Sara Rafalson

Sol Systems to Sponsor, Speak at Novogradac Financing Renewable Energy Conference in San Francisco

Sol Systems will speak at the Financing Renewable Energy Conference.

Sol Systems will speak at Novogradac’s Financing Renewable Energy Conference.

Several members of the Sol Systems team are in San Francisco for Novogradac’s Financing Renewable Energy Conference. While in San Francisco, Sol Systems’ CEO, Yuri Horwitz, will speak on a panel detailing the tax equity outlook for renewable energy assets. Yuri and the panelists will provide updates on the current state of the solar tax equity market, the tax equity investor pool, and investing plans for 2014.

Sol Systems has a track record of success in facilitating solar tax equity transactions. The Sol Systems team originates solar project opportunities from our extensive network of solar developer partners and then leads the negotiations and deal structuring on behalf of its solar tax equity investors.  Most recently, the Sol Systems team announced the closing of a commercial solar project portfolio with Nationwide Mutual Insurance. Read the rest of this entry »

Sara Rafalson

Sol Systems Bundles & Secures Financing for 2.8 MW Rhode Island Solar Portfolio

Sol Systems secured financing for this 2.8 MW Rhode Island solar project, which reached operational status this month.

Sol Systems secured financing for this 2.8 MW Rhode Island solar project, which reached operational status this month.

Sol Systems is pleased to announce the successful financing of a 2.8 megawatt (MW) solar portfolio in Rhode Island. Megawatt Energy Solutions developed the four project opportunities, which are located in Cumberland and Providence. The systems reached operational status in April. Sol Systems facilitated the financing process by providing due diligence, working with Megawatt to alter the site lease and lower the EPC costs, bundling the projects into a portfolio, and obtaining financing from a capital source with previous experience in the Rhode Island solar market.

This was Megawatt’s first commercial-sized deal, and the first time they sought third-party financing. “We are glad to have worked with an experienced financing partner like Sol Systems to bring our first third-party financing deal over the finish line,” said Steven Depina, President of Megawatt Energy Solutions.

“We pride ourselves on bringing C&I solar projects like this one to fruition through our diverse pool of capital,” said Andrew Gilligan, Sol Systems’ Director of Investments. “We look forward to working with the Megawatt team on future investments.” Read the rest of this entry »

Sara Rafalson

3 Financing Lessons Residential Solar Can Teach C&I

Residential solar is booming. Here's what commercial and industrial (C&I) solar can learn from residential as it looks to scale.

Here’s what commercial and industrial (C&I) solar can learn from the booming residential solar market.

As new and old solar investors seek investment opportunities in distributed generation (DG) solar, there are a number of parallels that can be drawn between the residential and commercial sectors. While residential solar developers have had significant success in obtaining financing for their solar projects, growth has been more sluggish in the commercial and industrial “C&I” sector, which we define broadly as projects that are behind the meter and are either rooftop or adjacent to a host. Despite several differences between residential and C&I, we think there are three basic lessons that C&I can learn from the residential space.

1. Develop Portfolios, Not Projects

Residential solar companies aggregate large portfolios of solar assets and finance tranches of around 5,000-10,000 solar energy systems at a time. This distributes financing risks across thousands of assets.  Although C&I portfolios will not comprise thousands of solar assets anytime in the foreseeable future, it is certainly easier to finance a portfolios of several 200-900 kW projects than it is to finance one-off projects.  Read the rest of this entry »

Natacha Kiler

Solar Cost of Capital Is Becoming Less Costly

Solar's cost of capital has come down slightly.

More capital is competing for solar projects. This competition for quality solar projects is driving down return hurdles for many investors.

As many have hoped and predicted, it appears that competition among financiers is driving down required solar project return hurdles for many investors.  Market clearing prices for projects indicate that investor hurdle rates for financeable large commercial and small utility projects have dropped 100-200 basis points (1-2%) in the last six months. There are a number of reasons this is starting to happen.

To begin, the cost of capital is getting more competitive as more capital rushes into the solar space. More investors are chasing deals, and by the basic function of supply and demand, increased supply means lower prices, or in this case – lower project return hurdles.

Debt is also becoming more plentiful as new debt providers have emerged (including Sol Systems and its partner Hannon Armstrong). This is making debt more affordable, and many of these debt options have longer tenors. For example, our $100 million debt fund accommodates term loans with 20-year tenors.  Read the rest of this entry »

Jessica Robbins

Sol Systems Completes the Massachusetts Solar Market’s First SREC II Transaction

Sol Systems is the first to close a prepaid SREC contract in Massachusetts' nascent SREC II market.

Sol Systems is the first to close a prepaid SREC contract in Massachusetts’ nascent SREC II market.

Sol Systems is pleased to be the first to close a transaction in solar renewable energy credit (SREC) II, the newest iteration of the Massachusetts solar market. Under this agreement, Sol Systems will provide solar project financing via a prepaid SREC contract to EthoSolar, an Ontario-based solar power provider with over 600 systems installed in North America, for a 150 kilowatt (kW) solar energy project.

This landmark deal is the first prepaid SREC contract in the nascent Massachusetts SREC-II market, which will be promulgated on April 25. Sol Systems provided a Sol Upfront contract, issuing pre-payment to EthoSolar’s client for generation of SRECs in 2014 and 2015; this capital was key in pushing the project over the finish line in light of a tight deadline.

“Combining an upfront sale of a percentage of SRECS with other traditional and nontraditional solutions allowed us to negotiate an attractive financing solution from a local bank that has our client in the black from day one on this project. Sol Systems brought creativity and value that was outside the box,” said Ethan DeSota of EthoSolar.

Read the rest of this entry »

Natacha Kiler

VOSTs: Solar’s Newest Friend or Foe?

Is the Value of Solar Tariff (VOST) the next big trend in solar energy policy?

Is the Value of Solar Tariff (VOST) the next big trend in solar energy policy?

Last month, a Value of Solar Tariff (VOST) emerged in Minnesota, and it was accompanied by extensive commentary from the solar industry.

What is a VOST and why is it interesting?

VOSTs are utility rate tariffs. They are similar to Feed-in Tariffs (FITs) because the utility pays the system owner for all the solar electric generation; there is no net metering calculation to account for solar energy consumed by the host. However, VOSTs and FITs differ in the way the rate is calculated. Theoretically, VOSTs account for the positive and negative attributes of solar, such as avoided cost, alleviation of grid congestion, and environmental benefits. Although it is not the first VOST (Austin, TX claims that precedent), the Minnesota VOST has attracted attention because it is the first statewide precedent for calculating the value of consumer-generated solar power. Read the rest of this entry »

Natacha Kiler

April 2014 Solar Project Finance Journal

This month's Solar Project Finance Journal includes info on the most competitive PPA prices, developments in some of the hottest state markets, and information on yieldcos, storage, and more.

This month’s Solar Project Finance Journal includes info on the most competitive PPA prices, developments in some of the hottest state markets, and information on yieldcos, storage, and more.

Below, we have included excerpts from Sol Systems’ April 2014 Solar Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list.

The following statistics represent some high-quality solar projects and portfolios that we are actively reviewing for investment.

Capacity: 180 kW – 44 MW
Average Capacity:  5 MW Read the rest of this entry »

Sara Rafalson

Sol Systems and Hannon Armstrong Collaborate to Deploy Up to $100 Million of Debt Financing for Distributed Solar Project Developers in 2014

Today, Sol Systems and Hannon Armstrong announced a fund for up to $100 million of construction and term debt financing for developers and owners of distributed solar projects benefitting commercial, industrial, municipal and utility customers.

Today, Sol Systems and Hannon Armstrong announced a fund for up to $100 million of construction and term debt financing for solar projects.

Hannon Armstrong Sustainable Infrastructure Capital, Inc., (“Hannon Armstrong,” NYSE: HASI), a capital provider for sustainable infrastructure assets, along with Sol Systems, LLC (“Sol Systems”), a renewable energy investment firm, today announced plans to originate, structure and fund up to $100 million of construction and term debt financing for developers and owners of distributed solar projects benefiting commercial, industrial, municipal and utility customers throughout the United States and its territories. With HASI’s capital resources and Sol Systems’ transactional expertise in distributed solar, the parties believe they are well-positioned to originate and fund loans for projects and portfolios in these sectors.

Read the rest of this entry »

Sara Rafalson

Sol Systems Welcomes Colin Murchie as Director of Project Finance and Leslie Barkemeyer as Deputy General Counsel

Colin Murchie joins Sol Systems from SolarCity as Director of Project Finance.

Colin Murchie joins Sol Systems from SolarCity as Director of Project Finance.

Sol Systems today announced the appointment of Colin Murchie as Director of Project Finance and Leslie Barkemeyer as Deputy General Counsel.

Mr. Murchie joins Sol Systems from SolarCity Corporation, one of the country’s leading solar companies. His industry experience dates back to 2002, and previously with SunEdison and the Solar Energy Industries Association (SEIA), he led pioneering work on some of the fundamental policies underlying U.S. solar development.

As a Director, Policy and Electricity Markets, with SolarCity, Mr. Murchie led the company’s state-level advocacy work in a number of East Coast markets during a period of unprecedented progress.  In addition, he served as a resource to the company’s commercial sales team, performing diligence and advisory work on new and emerging solar programs nationwide, and elucidating business models for greater integration into the retail electricity markets.  At SolarCity, he also originated and managed a portfolio of solar renewable energy credit (SREC) contracts worth more than $20 million. Read the rest of this entry »

Daniel Watson

Sol Systems’ Debt Finance Director to Attend Greentech Media’s Solar Summit this week

Sol Systems’ Senior Director of Debt Financing Mike Midden will be in Phoenix this week to discuss debt financing at the GTM Solar Summit.

Sol Systems’ Senior Director, Mike Midden, will speak at Greentech Media’s Solar Summit this week in Phoenix. Mr. Midden presented today, April 14,  on how to drive down interest rates for solar project debt financing.

Mr. Midden has over 17 years of experience in the energy and financial sectors. Mr. Midden leads Sol Systems’ debt financing group, which oversees the $100 million solar debt fund that the Sol Systems launched in early 2014 to address financing challenges in the commercial and industrial (C&I) solar sector. Ideal projects range from (but are not limited to) 750 kW – 20 MW in size. Loans may be as small as $1 million and sometimes smaller, depending on the opportunity, with tenors as long as 18 years on term loans. Read the rest of this entry »

Anna Noucas

Massachusetts Finalizes SREC-II Program: Here’s What You Can Expect

The Massachusetts DOER expects the SREC-II Program to become effective late in April.

Massachusetts DOER expects the SREC-II Program to become effective late in April.

On April 11th, the Massachusetts Department of Energy Resources (DOER) announced that they have officially filed the final revisions for the SREC-II program with the Secretary of State’s office.  These final revisions will go into effect on April 25, 2014 once the rules have been promulgated.

To qualify for SREC-I, all systems less than 100 kW must both submit an application and demonstrate that they have been authorized to interconnect by April 25th.  For systems larger than 100 kW,  projects may receive an extension beyond June 30, 2014 only if the project can demonstrate that interconnection depends only on receipt of authorization to interconnect and such receipt is delayed only by the local distribution company or due to remaining steps required by other parties for safe and reliable interconnection. In addition, the DOER announced that they will be using a new online registration platform for all SREC II applications.  This new platform and application process will be made available to the public on May 6th.
Read the rest of this entry »

Sara Rafalson

Webinar Invitation – Everything You Need to Know about the Massachusetts SREC II Program

The Massachusetts solar renewable energy credit (SREC) program has been critical for driving the massive solar growth in the state. However, regulatory uncertainty has loomed since the Massachusetts Department of Energy Resources (DOER) announced last spring that the first iteration of the solar carve-out, now known as SREC I, had reached its cap. Since then, the industry has had their eyes on the development of SREC II, the Bay State’s next solar carve-out program. As SREC II nears promulgation, join Sol Systems, SEIA, and the Massachusetts DOER as we discuss:

  • SREC II’s regulatory framework and how it differs from SREC I, particularly in regards to the new SREC factor and Clearinghouse auction
  • The fate of Massachusetts SREC I subscribers, including those who have not yet been accepted into the program
  • Supply and demand dynamics in the MA SREC I & SREC II programs
  • Spot market prices and the availability of fixed price contracts, including advisable SREC strategies for both residential and commercial systems
  • How to finance commercial projects in Massachusetts, including advisable PPA rates and the availability of SREC strips

    Sol Systems will host a webinar on SREC II with the Massachusetts DOER and SEIA

    Join Sol Systems, Massachusetts DOER and SEIA for information on SREC II structure, pricing and market dynamics

Speakers include:
  • George Ashton, Vice President & CFO, Sol Systems LLC
  • Jason Cimpl, Renewables Trader, Sol Systems LLC
  • Michael Judge, Associate RPS Program Manager, Massachusetts Department of Energy Resources
  • Carrie Hitt, Senior Vice President of State Affairs, SEIA

The event will be taking place on April 23rd, 2014. Register today.

About Sol Systems
Sol Systems is a renewable energy finance firm that provides secure, sustainable investment opportunities to investor clients, and sophisticated project financing solutions to developers. Founded in 2008, Sol Systems focuses on meeting the industry’s most critical solar financing needs, including tax structured investments, capital placement, debt financing, and SREC portfolio management. To date, the company has facilitated financing for thousands of distributed generation solar projects and hundreds of millions in investment on behalf of Fortune 100 corporations, utilities, banks, family offices, and individuals. For more information, please visit
Daniel Watson

Rhode Island Solar Feed-in Tariff Now Accepting Applications for 2014

Contact us at finance@solsystemscompany.com for more information on the Rhode Island feed-in tariff.

National Grid, Rhode Island’s electric utility, recently announced a new round of enrollment in the state’s feed-in tariff program in the spring of 2014. The allocation is part of the Distributed Generation Standard Contracts program, which was created by legislation in June of 2011. The program originally called for a minimum of 40MW in new renewable energy procurement by December 30, 2014. The first open enrollment for the year targets 6 MW, 3.15MW of which is reserved for solar, with additional enrollments scheduled in July and October of this year.

The proposal period will run from April 21st until May 2nd. For solar systems above 250 kW, ceiling prices range from $0.2730/kWh to $0.2350/kWh, fixed, for 15 years, depending on system size and tax credits used for financing. Projects utilizing bonus depreciation and PTC/ITC will face lower ceiling rates across all sizes. Bonus depreciation is not currently available as an incentive. The Distributed Generation Standard Contract Board sets the ceiling prices and capacity targets for each enrollment period. Renewable energy projects including wind, solar, and anaerobic digestion are all eligible for the program, with certain distinctions based on technology and size. Following are the ceiling prices set by National Grid:
Read the rest of this entry »

Daniel Watson

Sol Systems to Travel to San Francisco, Las Vegas, and New York for Upcoming Solar Project Finance Conferences

The Sol Systems team will attend the 2014 SEIA Tax and Finance Seminar this week in San Francisco at the W San Francisco Hotel. George Ashton, Sol Systems’ CFO, will be participating in a panel discussion on securitization and its role in the solar space. The discussion will focus on how securitization has worked in the past, and its prospects moving forward.

Next week, several members of the Sol Systems team will travel to New York Bloomberg’s Future of Energy Summit 2014. Sol Systems’ CEO, Yuri Horwitz, will travel to Las Vegas for the 29th Annual Platts Global Power Markets Conference.

Read the rest of this entry »

Sara Rafalson

Sol Systems Announces SREC II Pricing for Massachusetts Solar

Sol Systems is currently offering 3 and 5-year SREC contracts for Massachusetts solar projects.

Sol Systems is currently offering 3 and 5-year SREC contracts for Massachusetts solar projects.

Sol Systems is pleased to announce the industry’s first official 3 and 5-year fixed price contracts for Massachusetts SREC II solar projects. Since the closing of the SREC I program, there has been a significant amount of uncertainty regarding the value of SRECS in the SREC II program, and consequently, a dearth of SREC II financing options. Sol Systems is offering this pricing to the industry to help solar installers, developer, and investors in the face of this regulatory and market uncertainty.

Please note SREC II pricing applies to customers under 100 kW interconnected after the SREC II promulgation date (currently April 25). These prices are firm, but we expect to expand and update our product offerings as SREC II is finalized.

Sol Systems continues to offer the full suite of SREC options for solar projects that have qualified for SREC I, including our fixed price contracts, upfront funding, and brokerage solutions.

In addition to SREC monetization, Sol Systems also offers construction loans, term debt, and take-out financing for commercial Massachusetts solar projects (generally 200 kW in size and larger). Please contact our team at finance@solsystemscompany.com to learn more about commercial financing opportunities.

Read the rest of this entry »

Natacha Kiler

March 2014 Project Finance Journal

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Below, we have included excerpts from Sol Systems’ March 2014 Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list.

Read the rest of this entry »

Anna Noucas

Massachusetts Makes Progress towards Finalizing SREC-II Regulation

The Massachusetts DOER expects the SREC-II Program to become effective late in April.

The Massachusetts DOER has initiated the final review process for the Solar Carve-Out II Program and they expect the Program to become effective by April 25th.

Solar stakeholders in Massachusetts are beginning to see the light at the end of the tunnel.  On Monday, March 17th, the Massachusetts Department of Energy Resources (DOER) announced that they have initiated the last review necessary before finalizing the Solar Carve-Out II program.  The Joint Committee on Telecommunications, Utilities, and Energy finished their review of the regulation and presented their comments to the DOER on Monday, March 10th, which has now started the last 30 day clock during which the DOER must consider the Joint Committee’s comments.

During a presentation at the NECA Renewable Energy Conference in Westborough, MA last week, the DOER mentioned the comments received from the Joint Committee were favorable and thus they plan to file the final regulation on April 11th with the expectation that the SREC-II program will become effective two weeks later on April 25th.  This means the DOER may very well begin receiving applications for the SREC-II program as early as May 1st, although this date has yet to be finalized.

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Alejandro Neira

Sol Systems’ Tax Equity Deal with SunEdison & Nationwide Mutual Featured in Bloomberg New Energy Finance

Bloomberg_New_Energy_Finance

Sol Systems Featured in Bloomberg New Energy Finance

Earlier this week, Sol Systems was featured in a Bloomberg New Energy Finance article detailing Sol Systems’ recent tax equity deal with Nationwide Mutual and SunEdison. In this transaction, Sol Systems advised Nationwide Mutual Insurance on the acquisition of the equity. This is part of Sol Systems’ ongoing success in bringing new tax equity to solars. SunEdison developed the 13.4 megawatt solar portfolio for California’s prison and hospital systems. Sol System’s Director of Marketing Natacha Kiler was featured in the Bloomberg article

Read about Sol Systems in Bloomberg New Energy Finance.

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Natacha Kiler

SunEdison, Nationwide Mutual, Sol Systems and National Bank of Arizona Announce Financing for 13.4 MW Solar Electricity Portfolio

Sol Systems recently closed a 13.4 MW tax equity transaction on behalf of Nationwide Mutual and SunEdison. This transaction is representative of Sol Systems' ongoing success in bringing new investors to the solar industry. The National Bank of Arizona provided the debt financing.

Sol Systems recently closed a 13.4 MW tax equity transaction on behalf of Nationwide Mutual and SunEdison. This transaction is representative of Sol Systems’ ongoing success in bringing new investors to the solar industry. The National Bank of Arizona provided the debt financing.

SunEdison (NYSE: SUNE), a leading solar technology manufacturer and solar energy services provider along with Nationwide Mutual Insurance Company, National Bank of Arizona (NB|AZ), and Sol Systems today announced a $50 million fund to build a 13.4 megawatt (MW) solar portfolio for the State of California prison and hospital systems.

Sol Systems advised Nationwide Mutual Insurance on the acquisition of the equity in the transaction. SunEdison secured long-term debt for the projects from the National Bank of Arizona (NBAZ). The projects will create local construction jobs that contribute to the local economy and tax base.

“Financing is a critical element of any solar project, and having partners who are willing to innovate with us is critical to our growth,” Carlos Domenech, President for SunEdison Capital, said. “We will continue to innovate to help SunEdison’s shareholders and finance partners extract more value from our projects and create new opportunities to finance and build distributed generation solar power plants.”

These projects mark the first time the companies have worked together on a solar project. The collaborative investment involved the use of innovative financing structures that enable the State of California to reduce energy expenses. The tax equity transaction is representative of Sol Systems’ ongoing success in bringing new investors to the booming solar industry, and demonstrates Nationwide’s commitment to investing in the communities where its members and employees live and work. “This technology is critical to our nation’s energy future and we are proud to work with an investment leader like Nationwide Mutual and a solar leader like SunEdison,” commented Yuri Horwitz, CEO of Sol Systems.

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Sara Rafalson

Virginia Makes Progress Toward More Favorable Solar Market

Will the Old Dominion welcome the solar industry? Though progress has been slow, solar momentum is picking up in the Commonwealth.

Will the Old Dominion welcome the solar industry? Though progress has been slow, solar momentum is picking up in the Commonwealth.

It is no secret that Virginia lags far behind in its track record on solar energy, especially compared to neighboring states such as D.C., North Carolina, and Maryland. Thanks largely to the development of robust solar renewable energy credit (SREC) markets, Maryland ranks fourteenth in the country in installed solar capacity, and the latest Solar Jobs Census puts D.C. third in solar jobs per capita. Even North Carolina, which has caught headlines recently for its extremely conservative state legislature, is #3 in solar capacity with approximately 388 MW of solar capacity, thanks largely to a generous state tax credit that has fueled the development of a robust solar economy.

Unlike these other markets, an unfavorable regulatory and political climate is the clear missing link for Virginia. As of November 2013, Virginia had installed a mere 15 MW of solar capacity, ranking #34 in solar jobs per capita in the United States. Since there is no solar carve-out in the state renewable portfolio standard (RPS), Sol Systems must sell Virginia customers’ SRECs into Pennsylvania, an already over-saturated market. As for commercial solar, through our solar investment business, we have noted little investor interest in the state of Virginia due to its unfavorable regulatory environment for solar project development, which includes a “C” rating for its underwhelming net metering policies.

There may, however, still be an opportunity to expand the solar market in the Old Dominion. After a string of solar bills was introduced this legislative session, solar supporters are optimistic that Virginia is making strides to support the growth of the solar in the state.

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Daniel Watson

Sol Systems Speaks at Solar Power Finance and Investment Summit in San Diego

Sol Systems’ CEO Yuri Horwitz, CFO George Ashton, and other members of the team traveled to the Solar Power Finance and Investment Summit in San Diego, California this week. As experts in solar project finance, both of Sol Systems’ co-founders spoke at this conference: George spoke on a panel on matching developer desires with their financing needs, and  Yuri spoke on project economic viability and deal structuring, especially as they are related to tax equity investment.  Yuri also spoke on project underwriting.

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To date, Sol Systems has facilitated financing for approximately 85 MW of solar energy projects through its tax equity, debt, take-out financing, and SREC portfolio management services. To meet with Sol Systems at a future conference, please visit our events page.

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Sara Rafalson

Sol Systems Announces New Round of Financing for Distributed Generation Solar, Issues a Call for Projects to Fill the Fund

Sol Systems is actively seeking solar projects 200 kW - 5 MW in size for investment.

Sol Systems is actively seeking solar projects 200 kW – 5 MW in size for investment.

Today, Sol Systems announced allocations from several investor clients to be devoted to financing distributed generation solar assets. This latest fund is representative of Sol Systems’ efforts to expand the pool of capital available for commercial and industrial (C&I) solar, a typically under-served sector of the solar market.

Sol Systems is actively seeking 2014 project pipeline to fill the fund allocations, and new projects are being considered on a first-come, first-served basis. Ideal opportunities will meet the following metrics:

  •  Size: 200 kW – 5 MW
  •  Locations: Arizona, California, Connecticut, New Jersey, New York, or Massachusetts
  •  Timing: Potential to be closed in Q1 or Q2 of 2014 and placed in service in 2014 Read the rest of this entry »
Sara Rafalson

Sol Systems Closes Financing for 940 kW Solar Project in New Mexico, Launches Financing Partnership with Affordable Solar

Sol Systems' new partnership with Affordable Solar will provide financing solutions for Affordable Solar's national installer network.

Sol Systems’ new partnership with Affordable Solar will provide financing solutions for Affordable Solar’s national installer network.

Sol Systems is pleased to announce the financial closing of a 940 kilowatt (kW) solar energy system in Alamogordo, New Mexico. The project was the second deal that Sol Systems financed on behalf of New Mexico-based developer, Affordable Solar. Sol Systems also closed an 806 kW Affordable Solar project in the fall of 2013.

This recent project closing coincides with a new partnership that Sol Systems and Affordable Solar launched to streamline financing for distributed solar energy projects. Through the partnership, Sol Systems will work closely with Affordable Solar and their national installer network to unearth, provide due diligence, and refine projects before securing financing for each deal opportunity. The partnership will provide project development and analysis tools for Affordable’s installer network, while opening up a broad range of finance options for the projects.

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Daniel Watson

Will Commence Construction Language Add More Certainty to the U.S. Solar Market?

Solar project development is a process with varying timetables and degrees of difficulty: from finding a host site, to entering into power purchase agreements, the process can take several years. Any bump along the road can lead to uncertainty in the completion date for an investor or developer, especially for larger utility scale projects.

This uncertain timetable makes the expiration of the 30% Federal Investment Tax Credit (ITC) in 2016 a potentially precarious scenario for parties involved in solar project development. Currently, a project must meet a December 31, 2016 deadline to receive the 30% ITC, and missing this date could lead them to receive only 10%, a significant decrease in returns.

Commence construction legislation should provide security to investors and developers aiming to break ground by 2016

On February 6th, Senators Michael Bennet (D-CO) and Dean Heller (R-NV) introduced the Commence Construction Legislation, which confirms that developers only have to start construction before the ITC expiration date for the full 30% ITC to be monetized. If this moves forward, many in the industry can breathe a sigh of relief knowing that they have some room to meet this deadline.

Critics have claimed that this language is still not strong enough, and that the industry should be advocating to extend the ITC. There is also concern that allowing projects that are only under construction to be eligible creates incentives for developers to “undertake construction” that may not be fully planned or is merely prospective. The language around the rules determining what qualifies as “under construction” will play an important role, as relaxed legislation will likely lead to a oversaturated market of new projects as the expiration date nears. These numerous “faux projects” not only lead to confusion for investors who rely on concrete information, but could lead to overcrowding and underfunding. Read the rest of this entry »

Thomas Larson

Sol Systems Continues to Hire! Currently Seeking Project Manager

Sol Systems continues to expand in order to facilitate the deployment of solar projects. Now, we’re looking for a talented project manager to work with our developer and EPC partners to deliver solar assets on behalf of our investor clients. Please see the posting below for more information on the position and how to apply.

Position:  Project Manager

Description: A Project Manager on the operations team will have the following responsibilities:

  • Work externally with EPC teams and developers to effectively manage and deliver upon major milestones during the construction phase for our investor clients, on time and on budget.
  • Compose communications and scheduled status reports for internal and external parties.
  • Lead and participate in project meetings with EPC partners, conduct on-site meetings/inspections, and generally keep an active involvement during the installation and acceptance testing.
  • Proactively attend to potential issues associated with typical solar PV construction.
  • Oversee multiple projects in parallel, successfully meeting target goals for completion milestones.
  • Monitor performance of projects, manage relationships with O&M providers to deliver services. Read the rest of this entry »
Natacha Kiler

Jump-starting the Solar Undead & Improving Returns…With Debt

Workmen-install-HomeSun-s-007

New debt options are improving IRRs for new and operational projects and they are also solving critical financing issues for a variety other projects in the U.S.

Debt can be one of the most challenging pieces to secure in the capital stack, and especially for solar projects under 1 MW. This is because renewable commercial banks see these deals as too small, regional banks have investment size and tenor limits that make financing difficult if not impossible, and local banks have limited experience with solar.  With these obstacles, it should come as no surprise that new solar debt options would be welcomed by the solar community. And, since we launched our $100 million debt fund, we have been rewarded with a wide variety of projects that are strong candidates for debt.

A number of new opportunities and operational projects are in the usual domestic markets, but some strong opportunities for debt have come from less expected places like Ontario and the Virgin Islands — and there are even several safe-harbored 1603 projects. Here are some reasons why the project opportunities are surfacing (or re-surfacing) and how the availability of construction and long-term debt contracts are injecting new vitality into both new and older solar projects.

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Natacha Kiler

February 2014 Project Finance Statistics

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Below, we have included excerpts from Sol Systems’ February 2014 Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list.

Read the rest of this entry »

Sara Rafalson

Sol Systems Launches $100 Million Fund, Seeks Solar Projects in Need of Construction and Term Debt Financing

Sol Systems has launched a $100 million fund for construction and debt financing. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for more information.

Sol Systems has launched a $100 million fund for construction and debt financing. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for more information.

Sol Systems recently launched a $100 million debt fund and is currently conducting diligence on projects to fill the fund. Solar developers with projects in need of construction and term debt financing should contact the Sol Systems project finance team immediately.

Ideal projects range in size from 750 kW – 20 MW and have an investment-grade off-take contract agreement in place; however, consideration will also be given to other projects, including projects with strong non-investment grade credit, if a developer has extensive project pipeline or if the projects show exemplary returns.

The $100 million solar debt fund addresses financing limitations for commercial and industrial solar projects. It offers both construction and term loans and distinguishes itself from other loan products with its minimum loan requirements and flexible terms. Loans may be as small as $1 million and sometimes smaller, depending on the opportunity, with tenors as long as 18 years on term loans.
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Natacha Kiler

Sol Systems’ Rafalson Joins Leadership Team of Women in Solar Energy

Sol Systems’ Sara Rafalson has joined the leadership team of the Women in Solar Energy Group as their Vice President of Membership Engagement and Communications. The mission of the group is to promote the involvement of women in the advancement of all aspects of the solar energy industry.

Sol Systems became involved in Women in Solar Energy after hosting a women in solar happy hour at Solar Power International, the industry’s largest annual conference, to encourage an open environment for women to share strategies for personal and professional success.

The Women of Sol Systems shout out for solar at the end of January.

The Women of Sol Systems shout out for solar at the end of January.

Diversity is a core value at Sol Systems, where the management and staff believe that different viewpoints improve creativity, innovation, idea sharing, and problem solving. Approximately half of Sol Systems’ staff is female; this is far above average for the solar industry, where one in five workers is female. Sol Systems also has a strong representation of minority ethnicities and religions.

Beginning this month, Women in Solar Energy will distribute a quarterly newsletter to promote the advancement of women in the industry through professional networking events, articles about gender issues in the workplace, solar career opportunities, as well as general solar trends. Ms. Rafalson will play an integral role in launching and distributing the newsletter.

Sol Systems has joined the leadership team for Women in Solar Energy, a professional group dedicated to the advancement of women in the solar workforce.

Sol Systems has joined the leadership team for Women in Solar Energy, a professional group dedicated to the advancement of women in the solar workforce.

The Women in Solar Energy group hopes to launch an official mentorship program later this year and will host events at PV America and Solar Power International. There will also be a D.C. Women in Solar Happy Hour on March 6. Please email sara@solsystemscompany.com if you wish to be added to the newsletter distribution list.

About Sol Systems
Sol Systems is a boutique financial services firm and a leader in the solar industry.  Sol Systems offers investor clients direct access to the renewable energy asset class and provides developers with sophisticated project financing solutions. Founded in 2008, the company focuses on meeting the most critical needs of the industry, including SREC monetization, capital placement, tax equity, and debt. To date, the company has arranged financing for thousands of projects and facilitated hundreds of millions in investment on behalf of Fortune 100 companies, private equity, family offices and individuals.
Alejandro Neira

We’re Hiring! Sol Systems Seeks MBA Marketing Intern

Sol Systems is expanding rapidly to accommodate business growth.

Sol Systems is hiring! Visit our careers page for more information on our most recent openings

Sol Systems continues to expand its team of solar project finance professionals. In addition to new postings for a Project Finance Associate and a Tax Equity Associate, we are also looking to hire a MBA Marketing Intern. See the posting below for the this position.

Position: MBA Summer Internship – Marketing Strategy at Solar Energy Investment Firm

Requirements: The ideal candidate will be a current MBA student who is: quantitatively minded, resourceful, detail-oriented, driven, and passionate about the development of renewable energy. Prospective candidates should possess the following skills and attributes:

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Sara Rafalson

Infographic: What Solar Investors Want

The shortage of project finance is a limitation to the non-residential, commercial and industrial (C&I) sector of the solar market.  Especially compared with other sectors of the market, C&I distributed generation solar is plagued with high transaction costs and a lack of standardization. Though there is no shortage of solar investors trying to break into the promising solar asset class, there is a true shortage of financeable, quality project pipeline. This lack of financeable deal flow is stifling the market and limiting the growth potential of the U.S. solar industry.

To help investors in the search of a “good” project – and to help developers increase the likelihood that a given project will attract third party investment, Sol Systems has developed the below infographic to serve as a guide to developing the perfect project.

What Solar Investors Want Infographic

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Sara Rafalson

Is the Pennsylvania Solar Market on the Rebound?

Sol Systems provides fixed, quarterly payments for each full SREC produced, removing price volatility, and providing customers with a steady income stream over a 3, 5, or 10-year SREC contract term.

Who would have thought SRECs in PA would jump from $18 to $70 in a manner of months? 

Pennsylvania has long been a model of a solar renewable energy credit (SREC) market gone wrong. The market was (and still is) four times oversupplied, and SREC prices fell to $20 in 2013 from $300 in 2010. However, prices have surged to $70, which has many people asking, what is going on in Pennsylvania, and more importantly, will this bust market be revived in 2014?

To answer this question, it is important to understand the history of the Pennsylvania SREC market and why it became so oversupplied in the first place. In 2004, Pennsylvania’s Alternative Energy Portfolio Standard (AEPS) mandated for the state to procure 18 percent of power from renewable and alternative sources by 2021. Of this 18 percent, the state’s SREC market was created by a 0.5 percent solar carve-out.

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Alejandro Neira

Sol Systems is Hiring! Internships Summer 2014

Sol Systems is expanding rapidly to accommodate business growth and to maintain its excellent level of customer service. In addition to new postings for a Senior Director of Tax Equity and a Tax Equity Associate, we are also looking for Summer 2014 Interns to join our team. See the posting below, or visit our careers page for more information.

Position: Solar Analyst Intern (position beginning in May 2014) targeted towards undergraduates and recent graduates

Description: The Solar Analyst Intern will assist with registration processes, administrative duties, and research tasks, and will be expected to provide clearly defined deliverables. The position will require attention to detail, excellent record keeping, and efficient allocation of time and resources.

Through this position, the Solar Analyst Intern will gain familiarity with solar legislation, solar finance mechanisms, industry news, and industry vocabulary, as well as new product development in a fast paced, start-up environment. This position provides a fantastic launching pad for a career in renewable energy.

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Sara Rafalson

Why the New Jersey Solar Market Just Got Hot Again

New Jersey SREC pricing is on the uptick.

New Jersey SREC pricing is on the uptick. Here’s why we think the New Jersey solar market is heating up.

New Jersey has long been a cautionary tale of the boom and bust cycles of solar renewable energy credit (SREC) programs. In 2009, New Jersey’s SREC values were close to $700 per megawatt hour. Then, in fall 2012, prices dipped to the $70 mark, demonstrating the true volatility of SREC markets. However, a recent rebound in SREC prices offers owners several profitable ways to profit from their SRECs.

After a lull period, the New Jersey SREC prices have ticked up once again. No, they are not back at $700 (and likely will never be again). However, we have traded as high as a healthy $170 per SREC in the last month on behalf of our SREC portfolio management clients.

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Daniel Watson

New Jersey’s PSE&G’s Second Solar Loan III Solicitation is Coming. Here’s What You Need to Know.

The Public Service Electric and Gas Company of New Jersey (PSE&G) will begin accepting applications in less than a month, on February 25, for its Solar Loan program. While no major changes have occurred since the first solicitation late last year, data is now available on pricing from the first round of applications and awards.

The first solicitation of New Jersey’s PSE&G Solar Loan III program began last year and closed the period on November 12th, 2013.  The program provides loans that make up significant portions of project construction costs (see an example here). The loans can be repaid through SRECs, with payment plans set at the closing of the loan. Cash can also be used to pay in case of low production. Once the loan has been paid in full, any SRECs produced thereafter belong to the owner of the system. The following capacities are available per each program segment:

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Thomas Larson

We’re Hiring! Sol Systems Seeks Project Finance Associate

Sol Systems continues to expand its team of solar project finance professionals. In addition to new postings for a Senior Director of Tax Equity and a Tax Equity Associate, we are also looking to hire a Project Finance Associate. See the posting below for the Project Finance Associate position, or visit our careers page for more information.

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Alejandro Neira

Sol Systems’ Senior Associate Andrew Gilligan Speaks at “Careers in Energy” Panel at Georgetown University

Andrew addressed students interested in energy careers as part of a "Careers in Energy" panel

Andrew Gilligan addresses students as part of a “Careers in Energy” panel

Last week, Andrew Gilligan, Sol Systems’ Senior Associate, visited Georgetown University to speak in an energy career panel hosted by the International Business Diplomacy Program and the Center for German and European Studies. Andrew spoke alongside Tom Cunningham, Energy and Diplomacy Officer at the Bureau of Energy Resources at State, and Kevin Massy, Director of International Affairs at Statoil.

During the panel, Andrew talked about his time at Georgetown Energy, a student-run clean energy action group based in Washington, D.C. and how this experience first sparked his interest in renewable energies. While addressing students that want to start careers in the energy field, Andrew emphasized the importance of networking and displaying interest and knowledge in the field. Understanding the company and making your resume and cover letter professional and tailored to the company you are applying to are essential for success in the application process.

Sara Rafalson

Sol Systems Welcomes Maria Thompson, Controller

Sol Systems is expanding rapidly to accommodate business growth.

Sol Systems is expanding rapidly to accommodate the growth of its solar finance business.

Sol Systems is continuing to expand to accommodate its rapid business growth. At Sol Systems, our biggest asset is our team, and we will continue to hire sharp, passionate team members. We are currently hiring for a Tax Equity Associate, Senior Director of Tax Equity, and Solar Analyst Interns . To learn more about careers with Sol Systems, please visit our careers page.

This week, Sol Systems is proud to announce the arrival of our new Controller, Maria Thompson.

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Natacha Kiler

Sun Still Rising on Residential Solar

We still see tremendous potential in commercial and industrial (C&I solar), but we’re also bullish on residential solar.

We still see tremendous potential in commercial and industrial (C&I solar), but we’re also bullish on residential solar.

There is much evidence pointing to a rosy future for residential solar.  High retail utility rates provide a compelling reason for homeowners to go solar while residential installation costs continue to drop.  Many of our partners claim that residential system development is more profitable than commercial development. Even solar developers that historically led the commercial and utility sectors are taking strides to enter the residential space.

In late 2013, SolarCity, successfully securitized cash flows from a portfolio of solar assets, accessing capital from the public markets via a $54 million bond offering. SolarCity accomplished the securitization milestone at a rate of 4.8%, and other solar companies may follow with perhaps even lower rates. Solar asset securitization deepens the pool of capital while cheapening the cost of capital. Meanwhile, SolarCity’s stock price has skyrocketed since its IPO a year ago, and new IPOs may be on the horizon for SunRun, Clean Power Finance, and Vivint Solar. Read the rest of this entry »

Natacha Kiler

January 2014 Project Finance Statistics

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Below, we have included excerpts from Sol Systems’ January 2014 Project Finance Journal, which is a monthly email newsletter that our project finance team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of solar industry resources.

If you would like to receive our Solar Project Finance Journal via email every month, please email pr@solsystemscompany.com with a request to be added to our Project Finance Journal distribution list.

Read the rest of this entry »

Alejandro Neira

Sol Systems’ CEO to speak on Tax Equity at Projects and Money 2014 Conference

Yuri Horwitz will speak on Tax Equity and capital structures conference in New Orleans.

Yuri Horwitz will speak on Tax Equity and capital structures at the Projects and Money 2014 conference in New Orleans.

Sol Systems CEO, Yuri Horwitz, will travel to New Orleans this week to participate in Infocast’s Projects and Money 2014 conference. Yuri is part of a panel that will discuss the optimization of capital structures, and will be joined by John M. Eber, Managing Director of Energy Investments at JPMorgan Capital Corporation, Drew Murphy, Senior Managing Director at Macquarie Infrastructure & Real Assets, amongst others. Some of the topics to be explored by the panelists include the current tax equity appetite, back-leverage deals, and infrastructure funds.

Yuri has been involved in the energy and environmental policy fields for over a decade and is a recognized subject matter expert on solar project finance. He has led the strategic development of Sol Systems’ solar financing business. To date, the firm has facilitated financing for over 84 MW of distributed generation capacity.

To schedule a meeting with Yuri in New Orleans, contact info@solsystemscompany.com.

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Sara Rafalson

Sol Systems Expands Financing for Commercial Solar, Facilitates Financing for 627 kW

Sol Systems recently facilitated financing for 627 kW in Indiana. Sol Systems financed another 1.7 MW on behalf of Solscient Energy, the developer, in the summer of 2013.

Sol Systems recently facilitated financing for 627 kW in Indiana. Sol Systems financed another 1.7 MW on behalf of Solscient Energy, the developer, in the summer of 2013.

Sol Systems recently announced the successful financing of a 627 kW distributed generation solar energy project in Goshen, Indiana. Solscient Energy, a solar integrator, developer, and independent power producer developed the rooftop solar project.  An Indiana utility will purchase the energy through a feed-in tariff.

This is the second transaction that Solscient closed with Sol Systems in the last year; the two firms worked together previously to secure financing for a 1.7 MW portfolio. The Sol Systems team executed a term sheet for this project on behalf of Solscient only two weeks after initial discussions.

“We’re glad to make commercial solar projects like this possible by streamlining the financing process for our developer and investor clients,” said Andrew Gilligan, who helps lead Sol Systems’ investor advisory services. “In this case, Solscient came to us with an attractive project, and we were able move quickly with our most appropriate funding source.”

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Anna Noucas

Formal Rulemaking Process Begins for Massachusetts SREC-II Program

On January 3, 2014, the Massachusetts Department of Energy Resources (DOER) announced that they filed revisions to the Renewable Portfolio Standard (RPS) Class I regulation, thus beginning the formal rulemaking process for establishing a framework for the SREC-II program.  The official version of the draft regulation will be published in the Massachusetts Register on January 17, 2014, but in the meantime, the DOER has provided an unofficial version on their website.

Timeline for the Formal Rulemaking Process

The formal rulemaking process begins with a public comment period which includes holding a public hearing.  Written public comments will be accepted from January 3 through 5:00pm on January 29, 2014 and the public hearing will be held on January 24, 2014 from 1:00 to 3:00 pm in the Gardner Auditorium of the Massachusetts State House in Boston.  Following the public comment period, the DOER will submit this proposed final regulation to the Joint Committee on Telecommunications, Utilities and Energy and will incorporate any changes deemed prudent from the public comments.  Within the following 30 days, the Joint Committee will review and submit comments on the regulation back to the DOER.  To conclude, the DOER must consider the Joint Committee’s comments for a period of not less than 30 days, and thereafter, the final regulation will be promulgated as soon as possible.  Based on the estimated outline in the table below, the SREC-II program should become effective in April 2014.

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Anna Noucas

Everything You Need to Know about the Most Recent Updates to Massachusetts SREC II

Massachusetts Department of Energy Resources (DOER) Commissioner Mark Sylvia recently shared the DOER’s most recent developments regarding its SREC II program.

Massachusetts Department of Energy Resources (DOER) Commissioner Mark Sylvia recently shared the DOER’s most recent developments regarding its SREC II program.

Massachusetts Department of Energy Resources (DOER) Commissioner Mark Sylvia recently shared the DOER’s most recent developments regarding its SREC II program with a packed house at the recent Electricity Restructuring Roundtable on Solar in New England and California.  The official draft has not been published for the public, but is expected to be filed any day now.  Here’s what you need to know.

  1. SREC-II Policy Objectives: Unchanged

The overall policy objectives remained unchanged under this most recent draft. The DOER’s main goals are still to provide sufficient economic support, control ratepayer costs, and create competitive, robust, and progressive market conditions that will maintain and expand PV installations in Massachusetts to reach Governor Deval Patrick’s 1600 MW goal by 2020.  The most significant updates and changes to the original SREC-II draft regulations came instead in the announcement of the key design features, which will drive the structure of the SREC-II Program.

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Natacha Kiler

Want to Invest in Solar? Join the Club.

Solar is increasingly viewed as a strong asset class, and more investors are waiting at the sidelines with sponsor equity. However, unless an investor is able to provide tax advantaged equity, they will find a very competitive environment.

Investors interested in deploying capital in solar projects should contact our project finance team at finance@solsystemscompany.com.

Sponsor equity is in abundance. There are a number of bankers, real estate professionals, and others interested in deploying capital into projects. This is tremendous for solar developers, but the overall supply of sponsor equity is large enough that it has started driving yields downward for many investors.

To remain competitive, investors are focused on lowering their cost of capital or investing in smaller or more complex solar projects that have not traditionally attracted investment. Even with a competitive, low cost of capital, investors will also need reliable access to tax equity (or their own internal tax appetite) in order to establish a competitive advantage to do solar deals.

To play seriously in the solar market, equity investors need a minimum of ~$3-10 million of annual tax liability. These investors are likely best suited to be take-out financiers (the single purchaser of a project) because of the relative simplicity and lower transaction costs vis-à-vis tax equity investing. Take-out solar investments are (generally) relatively straightforward because the investor provides the sponsor equity and makes use of their own tax appetite to monetize the Federal Investment Tax Credit.

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Natacha Kiler

December 2013 Project Finance Statistics

December 2013 Project Finance Statistics

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Every month, Sol Systems distributes a newsletter, the Sol Systems Project Finance Journal, to our community of solar developers and investors. The journal features solar finance statistics, trends, industry news, and SREC market information. We gather this information from our relationships and experience aggregating SRECs and financing commercial and utility scale solar projects.

We have included excerpts from our December Project Finance Journal below. If you have any questions about this information, wish to receive our monthly newsletter via email, or have a solar project in need of financing, please contact our team at finance@solsystemscompany.com.  We would love to hear from you.

 

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Keith Glassbrook

Sol Systems Discusses SRECs in Solar Industry Magazine

Sol Systems Discusses SRECs in Solar Industry Magazine

Sol Systems Featured in Solar Industry Magazine

Sol Systems was featured in a recent Solar Industry Magazine article “Experts Warn, Know The Game Before Betting On SRECs”. The article, which details the vital role solar renewable energy credits (SRECs) play in solar project finance, features key insight from Sol Systems’ Director of Marketing, Natacha Kiler:

“In some markets, SRECs make or break the economics of a solar project,” explains Natacha Kiler, director of marketing at Sol Systems, a Washington, D.C.-based solar financial services firm. Because every solar market is unique, she cautions developers to understand the underlying volatility and dynamics of SREC supply, demand and changing legislation.

Sol Systems went on to discuss the New Jersey market.

Sol Systems’ Kiler agrees. “When the SREC markets fell in New Jersey, some of those projects suddenly became unfinanceable.”

Kiler notes that New Jersey SREC prices recently rebounded and projects that were previously unfinanceable have become more attractive to investors “because SREC strips are available at increased prices.”

Read the rest of the article here.

Since 2008, Sol Systems has established their SREC expertise by managing solar renewable energy credits on behalf of over 4,000 customers in the East Coast and the Midwest. To learn more about our SREC options, contact info@solsystemscompany.com or call us at 888-235-1538 x1.

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Thomas Larson

Project Pitfalls: Four Red Flags that Kill Solar Deals

If you are a solar developer wondering why any of your projects has had difficulty securing third party financing, have no fear; our developer advisory services team has put together a list of four common project pitfalls that may kill your solar deal, as well as strategies to overcome them. By identifying fatal flaws early, developers can reduce soft costs and focus on opportunities that are the most attractive to prospective investors. While no single one of these issues is unequivocally lethal to a project, they can significantly narrow the gate to success if they go unmitigated.

Solar Red Flags

1.         Non-financeable Offtaker

Offtakers (the purchaser of a project’s electricity) with poor credit will have trouble attracting investment, so developers should understand an offtaker’s credit standing early in the development process. Some signs of poor offtaker credit include:

-The offtaker does not seem to be cash flow positive;

-The offtaker  has been around for fewer than 5 years;

-The solar project’s value would amount to a large portion of the offtaker’s assets.

If an offtaker does not pass these criteria, or has other credit concerns that would impair an investor’s confidence, an alternate strategy is to find a guarantor. A guarantor could be a parent company, a municipality, a school district, or really any credit-worthy entity that could serve as a backstop if the offtaker were to default on the Power Purchase Agreement (PPA). Additionally, if the offtaker is located in a desirable location, an investor may value the prospect of future hosts paying the PPA in the case that the original offtaker is unable to continue operations there. Read the rest of this entry »

Keith Glassbrook

Sol Systems’ Most Viewed Solar Project Finance Articles of 2013

Sol Systems’ Most Viewed Solar Project Finance Articles of 2013

We review our most viewed solar project finance articles of 2013.

As we reflect on the year, our team took a moment to examine the articles that sparked the most interest from our network. Topics range from new incentive programs in traditional solar states like California, emerging markets such as Rhode Island and New York, and the possible impacts of federal changes on the solar landscape.

In 2014, our team will continue to provide our network of solar energy system owners, developers, and investors with engaging, informative articles to help with their solar financing needs.

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Sara Rafalson

Sol Systems to Speak at GTM’s U.S. Solar Market Insight in San Diego

Yuri Horwitz will speak on standardization and solar securitization at the U.S. Solar Market Insight conference in San Diego.

Yuri Horwitz will speak on standardization and solar securitization at the U.S. Solar Market Insight conference in San Diego.

Sol Systems CEO Yuri Horwitz will be in San Diego next week on December 10 and 11 to speak at GTM Research’s U.S. Solar Market Insight conference. Yuri will speak on solar securitization and standardization alongside Richard Mull of KPMG and Nicholas W. Lazares, Chairman of the Board and CEO of Admirals Bank. The U.S. Solar Market Insight Conference presents data, analysis and expert forecasting on the state of the solar market in the U.S. To schedule a meeting with Mr. Horwitz in San Diego, please email info@solsystemscompany.com.

Yuri has been involved in the energy and environmental policy fields for the last decade and is a recognized subject matter expert on solar project finance. He has led the strategic development of Sol Systems’ solar project finance and SREC business and under his leadership, Sol Systems has facilitated financing for 70 MW of solar energy projects. The firm provided $135 million for solar projects in 2013 and will provide $250 million in tax equity financing in 2014.

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Thomas Larson

Sol Systems Seeks Renewable Energy Intern

Position: Solar Analyst Intern (position beginning in January 2014) targeted towards undergraduates

Description: The Solar Analyst Intern will assist with registration processes, administrative duties, and research tasks, and will be expected to provide clearly defined deliverables. The position will require attention to detail, excellent record keeping, and efficient allocation of time and resources.

Through this position, the Solar Analyst Intern will gain familiarity with solar legislation, solar finance mechanisms, industry news, and industry vocabulary, as well as new product development in a fast paced, start-up environment. This position provides a fantastic launching pad for a career in renewable energy.  Read the rest of this entry »

Anna Noucas

Ohio’s Renewable Portfolio Standard under Attack… Again

The Ohio SREC market in 2013 is projected to be more than two times oversupplied with an expected 129,000 SRECs to be issued compared to a demand of only 60,000 SRECs.

The Ohio SREC market in 2013 is projected to be more than two times oversupplied with an expected 129,000 SRECs to be issued compared to a demand of only 60,000 SRECs.

As the Ohio General Assembly approaches the final few months of its 2013 legislative session, attention has been brought to the Senate Bill introduced to repeal the state’s Renewable Portfolio Standard. Ohio State Senator Kris Jordan introduced Senate Bill 34 (SB 34) which, if passed, would “repeal the alternative energy resource requirements imposed on electric distribution and electric services companies to provide, by 2025, 25% of their electric supply from alternative energy.” To put it simply, if passed, this legislation would repeal Ohio’s Renewable Portfolio Standard (RPS), and the Ohio SREC market would be dismantled.

This is not the first time that Senator Jordan has attacked the Ohio RPS; similar legislation was introduced by Senator Jordan in 2012, but those previous bills failed to gain any support.  It remains to be seen how SB 34 will move forward in this current legislative session, as it has only been assigned to the Public Utilities Committee. A hearing has yet to be scheduled.

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Natacha Kiler

November 2013 Project Finance Statistics

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Our monthly project finance journal contains solar finance statistics, trends, industry news, and SREC market information. Contact our team at finance@solsystemscompany.com or 888-235-1538 x2 for your solar project financing needs.

Every month, Sol Systems distributes a newsletter, the Sol Systems Project Finance Journal, to our community of solar developers and investors. The journal features solar finance statistics, trends, industry news, and SREC market information. We gather this information from our relationships and experience aggregating SRECs and financing commercial and utility scale solar projects.

We have included excerpts from our November Project Finance Journal below. If you have any questions about this information, wish to receive our monthly newsletter via email, or have a solar project in need of financing, please contact our team at finance@solsystemscompany.com.  We would love to hear from you.

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Sara Rafalson

Sol Systems Attends Ribbon Cutting for Second Largest Solar Installation in D.C.

Sol CFO George Ashton, William Graves, and Sara Rafalson pose at the ribbon cutting for the second largest solar installation in D.C. Sol Systems financed the project.

Sol CFO George Ashton, William Graves, and Sara Rafalson smile at the ribbon cutting for the second largest solar installation in D.C. Sol Systems financed the project.

Sol Systems attended the grand opening of the new solar energy facility located at KIPP DC’s Douglass Campus in Washington, D.C. The ribbon cutting ceremony took place today, November 14, with Dot Harris from the Department of Energy serving as the keynote speaker.

The 227 kW solar energy system is the second largest solar installation in D.C. Sol Systems financed the solar project in partnership with Washington Gas Energy Systems. Sol Systems also provided the SREC contract. Volt Energy developed the project.

“We are proud to work with local partners, Volt Energy and Washington Gas Energy Systems, to bring innovative solar energy solutions to the District,” said George Ashton CFO of Sol Systems. “This partnership is good for D.C., the environment, and for the students that KIPP DC serves. Through this partnership, we have created electricity savings for the four KIPP DC schools at the Douglass Campus and a unique educational opportunity for students.”

Green State Power, a full service solar integrator based in North Carolina, completed construction of the carport and rooftop structure under an extremely tight deadline, as construction needed to be completed by the time that students and teachers returned to the campus after summer break.  Green State Power has a track record of success in both commercial and residential PV and solar thermal projects throughout the Southeast.

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Keith Glassbrook

Sol Systems to Speak at Distributed Solar Summit 2013

Sol Systems to Speak at Distributed Solar Summit 2013

Sol Systems George Ashton and Andrew Gilligan to Speak at Distributed Solar Summit 2013

Another week, another conference.

Next week, Sol Systems will speak at the Distributed Solar Summit in San Diego, California. Sol Systems CFO, George Ashton, and Senior Associate, Andrew Gilligan, will both be featured on Monday, November 18 during the U.S Distributed Solar Markets: Outlook and Analysis portion of the conference. George will speak about policy and incentive frameworks in New Jersey’s solar market. Andrew will discuss the solar policy and incentive frameworks in New York.

Developers interested in financing options for New Jersey or New York solar projects can contact our project finance team at finance@solsystemscompany.com or (888) 235-1538 ext. 2.  Our team is happy to discuss your project with you and assess financing opportunities. Solar installers with customers in need of SREC options in New Jersey can contact our SREC services team at info@solsystemscompany.com or (888) 235-1538 ext. 1.

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Keith Glassbrook

California’s Big Three Utilities Reject Battery-Backed Solar

California’s Big Three Utilities Reject Battery-Backed Solar.

Three of California’s biggest utilities reject battery-backed solar.

It is no secret that utilities across the country are resisting the growth of distributed solar. This time around, Southern California Edison (SCE), Pacific Gas and Electric (PG&E), and San Diego Gas & Electric (SDG&E), California’s three largest utilities, are grappling with integrating battery-backed solar systems into the grid. The utilities are refusing to integrate solar systems with integrated battery storage systems if both system components are behind the same meter.

This may seem like a trivial issue because battery-backed systems add about 25 percent to the cost of rooftop solar systems and only make up a small part of the solar market. Nevertheless, Bloomberg predicts that battery costs will fall 57 percent from $1,893 per kWh now to $807 per kWh of storage capacity in 2020 making battery-backed systems more attractive to customers. Similarly, Lux Research Inc. forecasts that the global market for solar systems combined with energy storage will rise from less than $200 million this year to $2.8 billion in 2018. Coupled with the fact that California accounts for more than 30% of solar installations in the U.S., these predictions mean the stance of California’s big three utilities’ on battery-backed solar could have a major impact on the growth of solar.

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Jessica Robbins

First Round of PSE&G’s Solar Loan III Program Begins Accepting Applications

Due to the competitive nature of the application process and the relatively low prices in the NJ SREC market, we expect the commercial segments especially to see very tight margins.

Due to the competitive nature of the application process and the relatively low prices in the NJ SREC market, we expect the commercial segments especially to see very tight margins.

After two successful prior rounds, PSE&G launched their third Solar Loan program and began accepting applications for PV projects on October 31st. The first round of competitive solicitations will close on Tuesday, November 12th. Projects in PSE&G service territory that are eligible for net metering can receive a percentage of project costs upfront as a loan to be paid back with SRECs or cash during the life of the project. The program will accept 97.5MW in both residential and commercial projects. Sol Systems previously wrote about the program here.

Solar Loan Program III will differ from previous procurements in several ways. Unlike previous Solar Loan programs, the floor price per SREC will be determined by a competitive bid-in process. The program will also feature a ten year loan term, down from 15 years in previous rounds. It will not include a call option on SRECs, providing additional security for investors. The available capacity will also be divided into market segments (various types and capacities of residential and commercial projects), meaning increased diversity of project types in the program. The program applicants will now be responsible for administrative costs of the program as well, in the form of per kW fees. Bidders should account for these fees in their floor price.

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Natacha Kiler

Sol Systems Finances SunPower Residential Solar Portfolio with New Tax Equity

Sol Systems recently brought a new tax equity investor to solar and financed over a thousand systems for SunPower.

Sol Systems recently brought a new tax equity investor to solar and financed over a thousand systems for SunPower.

Sol Systems announced today that it has successfully financed a residential solar portfolio for SunPower Corp. The investment will fund over a thousand solar energy systems for homeowners across the northeastern and southwestern United States. The tax structured investment is part of Sol Systems’ ongoing initiative to bring new tax equity investors into the solar asset class.

Solar panel costs have fallen rapidly in recent years and solar project investments have exploded; however, there remains a shortage of investors who are able to take advantage of the tax credits associated with solar energy system ownership. To address this issue, Sol Systems has devoted itself to bringing new tax equity investors to the solar asset class. Sol Systems has provided tax equity financing for over $100 million in solar projects in 2013, and expects to provide tax equity financing for $200-250 million in 2014, a critical injection of tax equity into the solar market.

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Alejandro Neira

Minnesota Utility Seeks to Double State’s Solar Power in Coming Years

solar-panels-in-garden-feat

If approved by the Minnesota Public Utilities Commission, Xcel would seek to develop up to 2.5 MW per quarter during the next two years, for a total of up to 20 MW.

As the solar industry continues to expand and grow, states across the country are recognizing the importance of going solar and taking aggressive action to do so.  Minnesota is one such state that has recently taken the initiative to expand their solar presence. Minnesota’s H.F. 729 energy law, approved in the spring of 2013, seeks to significantly increase the presence of solar energy in the state’s power supply. While Minnesota passed a first piece of legislation in 2007 that created a Renewable Energy Portfolio Standard for the state, it did not include a specific solar carve-out requirement for the state’s utilities. This most recent law mandates that public utilities, including the state’s biggest utility Xcel Energy, meet a 1.5% solar standard by 2020.

While this percentage may seem low, in order to reach the 1.5% standard, Minnesota’s solar energy capacity would have to increase by 30-fold from the 13 MW currently installed in the state up to 450 MW by 2020. In an effort to comply with these new requirements, Xcel’s leadership has focused on finding new opportunities to expand the presence of renewables in their portfolio.

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Thomas Larson

Reaching Beyond the Roof: Three Strategies for Corporate Investments in Solar

The Compelling Solar Asset Class

There are many options available to corporations interested in investing in solar projects. The market for investing in solar projects is an expanding financial sector that provides corporate investors with an opportunity to diversify their investment portfolios and develop or expand tax credit platforms. In 2012, the volume of solar projects being installed in the United States grew 76 percent year over year, with 3,313 MW of projects built at an estimated value of $11.5 billion. These solar projects will provide enough electricity to power over 350,000 households in the United States. In 2013, it is projected that the asset class will grow by an additional 29 percent across residential, commercial and industrial, and utility scale solar projects.

Retailers and other corporations invest in solar through a variety of financing structures.

Retailers and other corporations invest in solar through a variety of financing structures.

Many corporations are joining retailers, tech companies, utilities, and major financial institutions in the solar space with investments both on and off their properties. In numerous locations, the rooftops of Staples, Best Buy, Wal-Mart, IKEA, Kohl’s, and others within the retail industry feature solar arrays. These retailers, as well as many other solar investors, secure reduced energy costs, tax benefits, and clean electricity for their stores, which further company-wide sustainability efforts and appeal to consumers.

Strategies for Solar Investments

There are three primary strategies for corporations to invest directly in the solar asset class and realize the benefits of solar energy: (1) purchasing electricity from an on-site or nearby solar project through a Power Purchase Agreement (PPA), (2) directly purchasing a solar project to provide free renewable energy to a company’s buildings or property, and (3) strategically investing in solar projects to secure long-term cash flows and significant tax benefits. Each is explored below. Read the rest of this entry »

Natacha Kiler

Top 5 Do’s and Don’ts of SPI (and All Solar Conferences)

Sol Systems' Director of Marketing, Natacha Kiler, reflects on the top 5 do's and don'ts at SPI.

Sol Systems’ Director of Marketing, Natacha Kiler, reflects on the top 5 do’s and don’ts at SPI.

Solar Power International is generally a good time, but this year’s conference in Chicago seemed better than some of the conferences in recent memory. After reflecting on the week, and why this year felt so much better than some other years, here are Sol Systems’ top 5 SPI conference best practices.

Do’s:

1. Set up meetings and locations in advance. SPI has gotten way too big to have impromptu meetings. If you want to meet with someone specific, put the meeting on the calendar (with the right time zone and everyone’s cell phone number), and have an idea of where you will meet more than 5 minutes before the meeting. No matter where the conference is located, you can generally meet: next to the registration area, at lunch tables in the expo hall, established event networking centers, at comfortable chairs outside the expo, “the” coffee shop, or in the lobby of the conference hotel.

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