Financing Solar: A Love Story

By Jamie Evans, Panasonic Eco Solutions, Managing Director, Head of U.S. Eco Solutions

Jamie Evans
Financing Solar: A Love Story

Where it All Began

In a world where precious natural resources are shrinking and climate threats loom large, actionable steps forward are not only celebrated, but also demanded by an ever growing environmentally-conscious society that knows we cannot afford to wait.

Excited to rise to the challenge, companies have made sustainability a top priority as more and more jump on board the “go green” train, developing and publishing annual corporate social responsibility reports that showcase their greenest initiatives and achievements, from water recycling programs to solar systems and beyond.

As business leaders flesh out plans to incorporate more environmentally friendly practices within their corporations, they know that ultimately it all comes down to facts and figures. While sustainable solutions are a necessary part of protecting our planet, they must also be economically viable.

Trouble in Paradise

On the surface, solar energy may appear to be easy – just sunshine and bright skies. But behind the scenes it can be a fragmented process full of complex, tax-driven financial structures and multiple layers of development and implementation.

Traditional solar models require the involvement of different third-party vendors at each phase of the process. From the start, facility managers, developers, and sustainability officials must engage with one firm for concept, one for design, one for construction, another for financing, and the list goes on. Partnering with multiple vendors causes solar projects to become disjointed and inefficient, resulting in cost increases, missed deadlines, frustration, and sometimes failure.

Independently financing, owning and operating solar assets is difficult for many organizations. The financial structures are complicated and many companies lack the tax liability needed to monetize tax credits and depreciation benefits. In addition, while Power Purchase Agreements (PPAs) have grown in popularity, the challenges associated with negotiating, structuring, and financing these deals, particularly with numerous parties, can frustrate potential customers and make the transaction cost prohibitive.

Couples Therapy

It’s a team effort to successfully go solar. Companies need a trusted partner with extensive internal capabilities who will guide them through every stage. These experts serve as a one-stop shop for renewable energy, streamlining the process and providing an end-to-end solution that includes project development, engineering, financing, construction, and long-term service and maintenance.

Integrated models typically offer a variety of financing options that eliminate the need for upfront capital outlays and simplify solar through a simplified set of contracts. This mitigates project delivery risks for a more efficient and cost-effective solution that ensures attractive and reliable benefits for decades to come.

Happily Ever After

These comprehensive solutions bring everything under one roof, meaning the partners are there during the honeymoon phase, when the sun is shining and solar savings are soaring, and through the long term life of the system, including asset management and maintenance services.

With panels in place, companies are reaping both financial and social benefits. They are simultaneously reducing utility costs and hedging future energy costs while also establishing their commitment to social responsibility, strengthening their brand identity – key to success in today’s sustainability-minded society.

Working with a streamlined solar provider, more corporations are pursuing solar solutions and achieving renewable energy success – efficiently and cost-effectively.

Article by Jamie Evans, Panasonic Eco Solutions, Managing Director, Head of U.S. Eco Solutions.

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