Stormy times didn’t stop the push for sunny money
Updated: Sep 10, 2020
In many parts of the world, solar panels are now producing electricity more efficiently than natural gas and coal. A few years ago, the recent drop in oil and gas prices due to COVID 19 might have increased the use of fossil fuels and hurt the renewable energy sector. Today, that is not the case. The renewable industry is running strong and businesses, schools, and nonprofits alike, are happy and healthily incentivized to go green to create a consistent and reliable revenue stream during these unpredictable times.
Although the solar industry was affected by the initial impact of the lockdown, as were most sectors, the commercial industry is moving along strongly. Businesses and the solar industry as a whole have benefited from continued government efforts and policies to address climate change, while augmenting grid capacity. The policy push to support renewable energy has been consistent and has helped make the solar industry more resilient to economic swings, even with the hit from COVID 19. The recently opened bid for new projects under the Massachusetts SMART program is just one example.Overall, investors and businesses alike are eager to invest, even now, and they are creating some bonus incentives of their own to encourage rapid decision making under regulatory deadlines.
Businesses want control and predictability, especially in our current market, and solar programs like PPAs and Lease packages are delivering. Solar investors have begun to flood the market with first year bonus offers of their own, in addition to the first year cash flow increases, sizable federal tax deductions and year one depreciation incentives. More businesses are open to seeing the tax benefits they can receive along with the overall ROI, and it becomes clear that solar is a strong investment especially with the COVID shutdown slamming their revenues.
So what makes a business, non profit, school, or landowner most suitable for solar during this time? All of these entities have a few things in common. They have a property space, a roof or land that is being underutilized, they support the green movement, and they are looking for a new revenue stream. Ideally, the property space, whether it be land, parking lot or rooftop, is relatively free from obstructions, zoning prohibitions, natural encroachments such as wetlands, and a relatively flat topography.
Once developed, solar is a low-impact and quiet use that does not disrupt the surrounding community. Schools, universities, and hospitals are now benefitting in monumental ways without making cuts anywhere and without the need for securing grants or organizing fundraisers. A report in 2019 found Virginia schools tripling their adoption of solar power since 2017. This report is the latest resource to come out of Generation180, a nationwide effort to support and inspire the people that can make solar happen at schools. Liz Doerr, a Virginia school board member at Richmond Public schools stated in 2019 that “the big opportunity for us was that solar was a win, win, win—for our district’s budget, our students’ education, and our community’s transition to clean energy.” (Globenewswire, 2019) Depending on the business, a solar site can be developed rather quickly and owners will begin to see a return on their investment in as little as five months. On a solar site lease there is often no need for any upfront investment and solar developers are simply leasing the roof space from the business while the developer handles all the maintenance on the roof and of the system. This simply provides the business with an ancillary revenue stream. This is also true of parking lots which can utilize solar carports and brown lots which are ideal for solar farms. It’s a very simple transaction for a business that turns their unused property from a previous liability, into an asset.
Learn more about how your organization can begin receiving the benefits of solar by contacting Louth Callan Renewables: 860-814-4379