solar case studies for tax exempt entities
DESCRIPTION
Solar Case Studies for Tax Exempt Entities. Presented By: Richard Raeke Director of Project Finance Borrego Solar Systems, Inc. Financing Options for Tax Exempt Entities. Solar is expensive at roughly $7,000/kilowatt (or $0.45/kWh) - PowerPoint PPT PresentationTRANSCRIPT
www.borregosolar.com
Solar Case Studies for Tax Exempt Entities
Presented By:Richard Raeke
Director of Project FinanceBorrego Solar Systems, Inc.
• Solar is expensive at roughly $7,000/kilowatt (or $0.45/kWh)
• On a typical solar project, the federal tax incentives pay for more than 1/3, local or state incentive programs pay for 1/3 and the last 1/3 comes from debt or owner equity.
• As tax-exempt entities, universities cannot receive the federal Investment Tax Credit/Grant and bonus depreciation on a purchase.
• Tax Exempt Entities have to look to more creative structures, such as PPAs, in order to monetize the tax credits.
• Without monetizing the tax credit, a customer would have to look to another funding source, such as grants or donations to make the system economically viable.
Financing Options for Tax Exempt Entities
• Long term agreement to purchase electricity from a third party financier (PPA Provider) – 20 year terms, predictable cost increases
• No equipment to purchase, no capital investment
• No annual maintenance expense, no asset to manage
• Customers purchase only the power produced by the system
A Power Purchase Agreement (PPA)
• Solar PV works in states with viable incentive programs
– Massachusetts – Commonwealth Solar Initiative
– California – Production Based Incentive (PBI)
– New Jersey – SREC program
– Others include Connecticut, New York, Pennsylvania, Arizona, Colorado, New Mexico, Oregon and Hawaii
• The ARRA
• Stay tuned – incentive programs are evolving.
State Solar Programs
Generate Change. Choose Solar.
Case Study: Boston Community Capital• Boston Community Capital received $10 million from
Massachusetts through the Green Affordable Housing Initiative
• BCC had mission of creating the most economical solution for putting on solar on affordable housing statewide
• BCC issued an RFP for an installation/financing partner
• Chose Borrego to help identify best sites and install systems
• Letters sent to dozens of affordable housing owners across state
• Based on responses, Borrego began evaluating sites
• BCC created a PPA provider – Solar Energy Advantage Program
• Five initial sites – Cambridge, Charlestown, Webster and Pittsfield
• Second round of installations to follow this year
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms: PPA Solution• Boston Community Capital PPA
• 100 KW
• Sharp 175 modules
• SMA inverters
• Uni Rac ULA racking
• 15 degree tilt – SSW
• Solar on 6 buildings
• Reduce common load kWh by 60%
• 20 year $.165 / kWh PPA
• Annual 1.25% escalator
Case Study: Cambridge Housing AuthorityWashington Elms
Generate Change. Choose Solar.
• 100 KW
• Sharp 175 modules
• SMA inverters
• Uni Rac ULA racking
• 15 degree tilt - SSW
Case Study: Cambridge Housing AuthorityWashington Elms: Roof Mounts and Racking
Generate Change. Choose Solar.
Case Study: Cambridge Housing Authority
Generate Change. Choose Solar.
Washington Elms: Roof Mounts and Racking
Case Study: Cambridge Housing AuthorityWashington Elms: Roof Mounts and Racking
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms: Electrical Conduit Installation
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms
Generate Change. Choose Solar.
Case Study: Cambridge Housing Authority
Generate Change. Choose Solar.
Washington Elms: Module Installation
Case Study: Cambridge Housing AuthorityWashington Elms: Module Installation
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms: Inverter Installation
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms: Completed Arrays
Generate Change. Choose Solar.
Case Study: Cambridge Housing AuthorityWashington Elms: Completed Arrays
Generate Change. Choose Solar.
Case Study: UCSD• Borrego won RFP issued by UCSD
• Partnered with Solar Power Partners to provide financing
• Borrego signs EPC contract with SPP
• SPP signs PPA with UCSD
• Roughly $0.15/kWh
• 20 year contract
• UCSD keeps RECs
• UCSD provides insurance
Case Study: UCSD
Generate Change. Choose Solar.
Site Evaluation
• Customer preferences • Electricity consumption
• Cost per kWh
• Available space
• Meter location
• Trenching
• Conduit runs
Case Study: UCSD
Generate Change. Choose Solar.
Prefabrication of arrays
Case Study: UCSD
Generate Change. Choose Solar.
Carport Construction
Crane day
Case Study: UCSD
Generate Change. Choose Solar.
Carport construction
Case Study: UCSD
Generate Change. Choose Solar.
Case Study: UCSD
Generate Change. Choose Solar.
Generate Change. Choose Solar.
Case Study: Padre Dam Municipal Water District
• 862 kW of thin film over three sites and on 15-foot tall carports
• 546 day sales process
• Borrego awarded RFP
• Expensive installation due to carports
• Borrego signed PPA and Site-Lease Agreement with Padre Dam
• Section 48 ITC faced expiration system needed completion by Dec. 31
• Borrego assigned PPA to a third-party at quoted price
• EPC negotiations finished mid-September 2008
• Construction finished and system interconnected mid-December
• Bonus depreciation preserved
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
Case Study: Padre Dam
www.borregosolar.com
www.borregosolar.com
Solar Case Studies for
Tax-Exempt Entities
Richard RaekeDirector of Project FinanceBorrego Solar Systems, Inc.
[email protected](510) 849-5414
www.borregosolar.com