Tag Archives: Finance

Patagonia to Fund Rooftop Solar Installations on 1,500 Homes

By Lorraine Chow, EcoWatch, March 11, 2016

While many major retailers—including Apple, IKEA and recently Whole Foods—are investing in solar to supply their own businesses with power, Patagonia wants you to have this clean, green renewable energy yourself.

The outdoor clothing and gear company is bringing rooftop solar to 1,500 homes in Arizona, California, Connecticut, Delaware, Maryland, Massachusetts, New Jersey and New York. The company made the announcement Thursday in a blog post:

Led by Patagonia and Kinaʻole Capital Partners, LLC, a first-of-its-kind group of five certified B-Corporations has come together to create a $35 million tax equity fund that will make the benefits of solar power available to more than a thousand U.S. households. The new fund uses state and federal tax credits to direct Patagonia’s tax dollars for residential development of affordable, efficient Sungevity solar energy systems.

The five B Corporations involved in the project are: Patagonia, which will be the tax equity investor; Kinaʻole, as the fund manager; New Resource Bank and Beneficial State Bank as lenders; and Sungevity, Inc., as the project developer.

The homeowners taking part in the venture will pay no up-front costs as they will sign a power purchase agreement (PPA) to buy solar energy for less than their utility’s rates. Any surplus power the panels generate will be sold back to the utility.

In all, the rooftop systems installed through Patagonia’s new solar fund are expected to produce 200 million kilowatt hours (kWh) of electricity over the solar installation’s typical 20-year life span.

Read full article from EcoWatch

Investors React Positively to SunEdison’s Restructured Plan to Buy Vivint Solar

By Stephen Lacey, Greentech Media

SunEdison shares jumped more than 14 percent today after the company revised the terms of its acquisition of residential installer Vivint Solar.

In July, SunEdison unveiled a $2.2 billion plan to acquire Vivint in cash, stock and convertible notes. Investors were not thrilled with the terms of the deal, however, and SunEdison’s stock declined precipitously over the following months.

Under the new agreement, SunEdison’s YieldCo, TerraForm Power, will pay $799 million in cash for Vivint’s residential portfolio — down from the original $922 million in cash. Vivint Solar shareholders have an option to purchase SunEdison’s common stock for an additional $0.75 per share.

Read full article from Greentech Media

The Silicon Valley Idea That’s Driving Solar Use Worldwide

By Mark Chediak & Christopher Martin, Bloomberg News

Silicon Valley has something to offer the world in the drive toward a clean energy economy. And it’s not technology.

It’s a financing formula. In a region that spawned tech giants Apple Inc. and Google and is famous for innovators and entrepreneurs like Steve Jobs, a handful of startups began offering to install solar panels on the homes of middle-class families in return for no-money down and monthly payments cheaper than a utility bill. This third-party leasing method — which made expensive clean energy gear affordable — ignited a rooftop solar revolution with annual U.S. home installations increasing 16-fold since 2008, according to the Solar Energy Industries Association and GTM Research.

“There is a reason why California is a tech Mecca for the world because the infrastructure is here to attract that talent,” said SolarCity Corp.’s Chief Executive Officer Lyndon Rive, whose company popularized third-party solar leases for homeowners starting in 2008. “All the major innovation is going to occur in California. One of the innovations is the financing of solar assets.”

SolarCity took the leasing model that SunEdison Inc. first developed for the solar industry by a graduate student named Jigar Shah. SolarCity adapted that model for residential consumers in 2008 and many more offered similar arrangements including Sunrun Inc., which developed the first one in September 2007, and Vivint Solar Inc. And now the idea is spreading to other industries trying to sell expensive capital equipment that reduce pollution and fossil fuel consumption.

Read full article from Bloomberg News

California Solar Costs & Value

By Jake Richardson, CleanTechnica (originally published on Solar Love)

There seems to be a lot of confusion about how much a home solar power system costs in the year 2015. Solar Power Now says the cost is about $3 per watt, or $15,000 for a 5,000 watt system, which seems to be about the average size for a single-family home. Actually, the size of the system will depend upon how much electricity that home uses, so you might need less than 5,000 watts. Obviously, the benefit is that then you would pay even less.

Did you know that solar power had dropped so much in price and become this cheap? Maybe not, because it does not seem that the public has caught up to the reality of what solar power currently costs. Even an official website managed by the state of California is using information from 2011. It says that the cost is $8.70 per watt and that a 4,000 watt system would cost about $34,000. A lot has changed in 4–5 years, but this website doesn’t reflect that.

If you could purchase a home solar system in California for somewhere between $15,000–25,000, you still get to subtract some of that cost due to incentives like the solar tax credit, which is still 30%. Then, there might also be some local incentives, so the overall cost could be even less.

Read full article at CleanTechnica

Clean-energy lender Renovate America tops $1 billion in loans

By Ivan Penn, The Los Angeles Times

A leading clean-energy lender has topped $1 billion in loans for home improvements — a milestone for the San Diego company as well as a once-foundering government program to encourage projects that reduce electricity or water use.

Renovate America got into the business in 2011 as the Property Assessed Clean Energy financing program, or PACE, was struggling to overcome opposition from mortgage lenders and federal housing regulators that had stalled the clean-energy lending effort. Since then, the lender has provided money to 44,000 households for efficiency projects in partnership with local governments using the Pace program. That represents not only a fast-growing source of revenue for Renovate America but also a gauge of the improving health of PACE programs.

PaceNow, a nonprofit organization that tracks use of the Pace programs nationwide, lists Renovate America as the top operation of lender among more than 100 members. Renovate America is the only one to reach $1 billion in financing, with more than 90% market share of all Pace programs, which operate in conjunction with local governments in 32 states and the District of Columbia.

Read full article in the Los Angeles Times

Rooftop Solar Brings Higher Home Appraisals

By Katherine Tweed, Greentech Media

Homes with rooftop solar are appraised at a higher value, according to new research from Lawrence Berkeley National Laboratory.

For the past few years, Berkeley Lab has been collecting data on the value of homes with solar photovoltaics compared to those without PV. Early studies relied on modeling and found that buyers were willing to pay an average of $15,000 more for a home with a solar PV array. Another study from January, based on survey data, found that homebuyers were also willing to pay a premium for leased systems.

The latest piece of research furthers those findings by assessing appraisals for PV homes in six markets within Oregon, California, North Carolina, Florida, Pennsylvania and Maryland. The appraisal premium ranged from about 3 percent to 6 percent based on the region, with a price boost of about $10,000 to $22,000. The valuations were based upon PV homes compared against comparable non-PV homes by local appraisers.

Read full article from Greentech Media

Inside California’s energy politics, the FERC Order 745 case, and the coming storage cost shift

By Gavin Bade, Utility Dive

[Editor’s Note: The following is part of Utility Dive’s coverage of the 2015 Energy Storage North America conference.]

For many power sector observers, California utilities are the ideal partners for forward-thinking regulators looking to adapt the utility business model to the 21st century. California’s investor-owned utilities proclaim their commitment to clean energy technologies demonstrating how they’ve surpassed mandates, accepted more rooftop solar, or integrated large amounts of storage.

Utility executives from San Diego Gas & Electric (SDG&E), Southern California Edison (SCE), and Pacific Gas & Electric (PG&E), provided apt examples in their keynotes at the Energy Storage North America conference. All these announcements could logically lead observers to conclude that California utilities have been proactive partners in helping set California’s ambitious clean energy goals. Not exactly, two veteran state legislators told Utility Dive at the conference.

Politics of renewable energy policy:

State Sen. Ben Hueso, chair of the Senate energy and utilities committee, ushered SB 350, the bill that set the state’s 50% RPS, through committee earlier this year. He said that the utilities have always fought hard against any mandates behind closed doors, whether it was SB 350 or earlier efforts. Former Assemblymember Nancy Skinner, echoed Hueso’s observations, but said that the power industry doesn’t behave much differently than others in this respect. “No industry likes mandates,” she said, noting that it took three legislative sessions to usher through the state’s previous 33% RPS, which was met with utility pressure behind closed doors.

California’s new RPS, by contrast, was authored and passed in one legislative session, a feat that Skinner said cannot be overstated. Not only does the bill increase the renewables portfolio standard to 50% by 2030, it also specifically calls on utilities to deploy energy storage and combines the renewables goal with an aggressive efficiency standard. So what changed to get such an aggressive bill passed so quickly?

…Clifford Rechtschaffen, a senior advisor to Brown, said the most important thing was that, in the end, “all of the utilities with the tiny exception of some northern California power agencies that had some qualms, they all supported SB 350.” Rechtschaffen said that while the utilities may have shown some resistance as the bill was working its way through the legislature, most of their concerns were operational in nature. “They weren’t quarreling with the notion that we needed to get to 50%,” he said. “They had concerns about how best to do it — some of which we agree with and others which we aren’t completely in line with, but we’re working on those. Storage is a big part of the solution.”

The role of storage in California’s renewable energy economy:

In a keynote panel discussion the California policymakers highlighted energy storage as the technology that can make 50% renewables and beyond possible for California. Once you get to that level of renewables, Rechtschaffen said, “storage is absolutely critical for grid integration. There’s no arguing about that.”

But the situation for storage, especially in the eyes of utilities, wasn’t always so rosy, Rechtschaffen said. Back in 2014, the state’s IOUs were resistant to the PUC’s mandate to deploy over 1,300 MW of storage on the grid by 2020, worried that the technology wasn’t ready and that it would “put storage in a bad light.”

In reality, the opposite happened, and SCE started off the storage procurements by buying 264 MW, when it was only compelled to purchase 50 MW at the time. For the California policymakers, it was a validation of the power of mandates to drive innovation in the power sector.

Read full article from Utility Dive

Related article: Why energy storage is key to a future with ‘no more gas turbines’ (Utility Dive) – Oct. 15, 2015

Solar Power International: Moving into Second Gear?

It’s a challenge to summarize what transpired over four days at an event with 600 exhibits, 70 concurrent sessions (forcing choice between 6 at a time), 15 manufacturer-sponsored hands-on training sessions, 10 workshops, plenary sessions, parties and, oh, did I mention solar-supportive keynote remarks by Vice President Joe Biden to an enthusiastic audience.  With participants from over 75 countries, it’s easy to see why Solar Power International (SPI) claims to be the largest and fastest growing solar conference in North America.  But let me try to extract a few themes from this mid-September event sprawled across all four Exhibit Halls at the Anaheim Convention Center.

Clearly the industry is growing.  In advance of the conference, the Solar Energy Industry Association and GTM Research released their quarterly update.  With 1,393 Megawatts of PV capacity installed in the second quarter, the US Solar industry remains on track for an annual forecast total of 7,700 MW.   Of this, 840 MW (60%) was installed in California.  (A brief reminder that the capacity of a typical nuclear powerplant is 1,000 MW.)  The fact that the California Senate and Assembly passed SB350 increasing the state’s current Renewable Energy target of 30% by 2020 to 50% by 2030 days before SPI added to the conference’s buoyancy.  Repeatedly cited was the statistic that California has over 55,000 employees working in the industry (more employees than the state’s top 5 utilities combined).

Clearly the industry faces challenges.  The major one is the currently scheduled expiration of the 30% residential tax credit and reduction of the commercial investment tax credit (ITC) from 30% to 10% fifteen months from now, the Administration’s request for a permanent extension of the ITC not withstanding. A Bloomberg forecast released at the conference anticipates that without an extension, 2017 will see installation activity dropping to its 2012 level.  The loss of the tax credit would hit California’s businesses as hard as elsewhere.  In addition, the fact that California’s Public Utility Commission (CPUC) is in the process of redesigning the utility rate structure, including deciding on an appropriate level of compensation for customers who generate their own solar energy, has the industry on edge.  Utilities have requested the compensation (or credits) allowed solar customers be reduced by 40%, and that fixed fees be added to solar users’ bills.  (If this sounds completely contrary to the legislative action on SB350 cited above, welcome to the world of Government.)

But beneath these Good News / Bad News headlines, several themes emerged that cut across the gazillion specific new product and service announcements.

Energy Storage developments are booming with a variety of technologies and products. Over 50 firms provided products or services related to Storage.  Those in California are as diverse as 90-year old Trojan Battery Company of Santa Fe Springs and Milpitas-based JuiceBox Energy, a start-up barely out of the garage.  Many clustered together on the exhibit floor in a zone known as the “Energy Storage Pavilion.” The CPUC mandate to the state’s three largest Utilities and other energy service providers to procure 1.3 GW of energy storage by 2020 creates an immediate market in California.  And the recognition that commercial electric customers can utilize storage to reduce their bills through reductions in their peak demand charges creates a market rationale for growing storage demand beyond the utility mandate.

Finance is another area experiencing dramatic change.   While the discussion only a couple years ago focused on lease or buy, a plethora of new financial instruments and capital sources have emerged.  Sessions and exhibits provided information on new approaches to debt financing for non-residential projects (which appears to focus on financial support for Commercial and Industrial (C&I) customers, a growing solar niche), Tax equity markets, and the pooling of solar project cash flows (in what’s become known as a YieldCo).  The good news is that investors (not just system owners) are seeing value (!) in PV installations.

And of course there were new panel developments, racking system improvements, Inverter advances and the like.

So what’s the take-away?  The Solar industry is growing through its increased cost-competitiveness as a result of new product and service innovation. This dynamic was well captured by Vice President Biden’s comment, “Anyone who thinks it (Solar) is not happening just take a look at the market.  It’s a competitive choice for consumers. …  Look, this isn’t a government mandate, this is the market working.”  Yes, but the uncertain future of tax credits and utility pushback (in California and elsewhere) continue the uphill slog.

Will solar energy shine on poor communities?

By Morgan Lee, The San Diego Union-Tribune

A billion-dollar effort to bring more rooftop solar to multi-family housing projects in poor communities is among a raft of clean-energy remedies approved late last week by California lawmakers, and now awaiting the governor’s signature.

Tucked into several approved bills are provisions designed to address the relatively slow spread of rooftop solar within low-income communities and at multi-family housing complexes. For those solar projects, financial arrangements and risks are typically more complex than the single-family homeowner market, and the payoff from solar energy has not always trickled down to the electricity bills for individual tenants.

Assembly Bill 693 would devote up to $100 million a year to expanding rooftop solar at deed-restricted affordable housing complexes. Those dwellings are reserved for people living on less than 60 percent of the local area median income. Exact details of the AB 693 program still need to be written by the California Public Utilities Commission, and might not move forward until 2017. The new solar program eventually could reach an estimated 200,000 low-income households if successful, offsetting individual utility bills in the process by 30 percent to 50 percent.

Read full article in the San Diego Union-Tribune

Creative Solar Finance Grows the Pool of PV Investors and Customers

By Eric Wesoff, Greentech Media

SolarCity and Bank of America Merrill Lynch just announced a $200 million tax equity investment program for solar projects that allows community banks to participate in tax equity — and opens up an enormous potential pool of new investors. Investors can invest $20 million to $25 million, a smaller investment than has been previously possible given the transaction costs.

Lyndon Rive, the CEO of SolarCity, said that with Bank of America standardizing the agreement and leading the initiative, “other regional banks can ride that, put capital to work, and meet their business goals.”

Rive spoke of the “mad rush” to get projects done before the tax equity party ends with the expiry of the federal Investment Tax Credit next year. SolarCity is growing enormously fast (as are its competitors Vivint, Sunrun, and Sungevity) and though well-financed for 2015, SolarCity will need to continue to bring new, low-cost capital into the solar market to continue its lofty growth.

Read full article from Greentech Media