Standardization and efficiency are the “it” topics in commercial and small utility-scale solar, where high transaction costs for one-off, relatively smaller deals has stifled the market’s potential. We’ve previously covered ways to achieve standardization through legal documents, but what about more standardized and efficient processes?
One way that we are introducing efficiency to the sector is through the improvement of our own internal processes. For projects in the 200kW – 5MW space to succeed, every efficiency improvement during the project financing process matters. After meticulous review of our own internal data and metrics, we crafted innovations to our closing process to ensure that deals with our developer partners will move to financial close in a manner that creates the most value for all parties.
Developers, next time you are closing a deal with us (which we hope will be soon), you will notice several key differences in our closing process. Without revealing too much of our secret sauce, we can say that:
A(lways) After reviewing three years of transaction data, we have been able to identify probabilities of success for projects based on stage or remaining development tasks. This allows us to cost-effectively prioritize key issues to address, and deals to execute.
B(e) Substantial binary risks (e.g. key permits, off-take commitments, net metering allocations, etc.) will be resolved, or at least completely understood, before transaction documents are negotiated. Once development issues are clear, we expedite the exchange of transaction documents to bring the fleshed-out deal to financial close, effectively preserving maximum value for each party.
C(losing) Diligence, transaction, and closing teams have been clustered into sub-processes to allow each team run even more efficiently.
Cheers to a new era of closing solar deals. We think you’re going to like it.
This is an excerpt from our June edition of SOURCE: the Sol Project Finance Journal, a monthly electronic newsletter analyzing the solar industry’s latest trends based on our unique position in the solar financing space. To view the full Journal or subscribe, please e-mail firstname.lastname@example.org.
ABOUT SOL SYSTEMS
Sol Systems is a solar energy finance and investment firm. The company has facilitated financing for nearly 200MW of distributed generation solar projects on behalf of Fortune 100 corporations, insurance companies, utilities, banks, family offices, and individuals. Sol Systems provides secure, sustainable investment opportunities to investor clients, and sophisticated project financing solutions to developers. The company’s tailored financial services range from tax structured investments and project acquisition, to debt financing and SREC portfolio management. For more information, please visit www.solsystems.com.