Columbia-Aquidneck-2011

Choppy Seas in Massachusetts? Check out Rhode Island for Smoother Sailing

For anyone looking to test the solar energy waters in Rhode Island, mark your calendars for April 18th at 9 a.m. National Grid has gotten approval from the Rhode Island Public Utilities Commission for its 2016 Renewable Energy (RE) Growth program. The first Open Enrollment for solar energy projects greater than 25kW will open on the 18th, and developers with solar projects will have two weeks, until April 29th at 5 p.m., to apply to the program. This will be the first of three Open Enrollment periods in the state for this year, with the second being tentatively set for some time in July.

Looking at Past RE Growth Journeys

National Grid’s RE Growth program is not new. It started in 2011 and later expanded in 2015 to include a total goal of 160MW of renewable energy by 2019. Eligible renewable sources include wind, hydro, and anaerobic digesters.

Under the program, National Grid offers 20-year tariffs to solar projects for their solar energy generation. Developers with projects competitively bid into the program at a price below the ceiling and if selected, that bid price is offered to the different winning projects.  In 2015, the ceiling prices for solar projects larger than 25kW were 16.70¢ per kWh for projects sized 1-5MW and 20.95¢ per kWh for projects sized 251-999kW. Medium-scale projects (26-250kW) did not have to bid in, and were able to enroll at a standard price of 24.40¢ per kWh. The RE Growth program also has a separate carve-out annually for small-scale solar projects under 25kW. Similar to the medium-scale solar projects, these do not have to be bid for, but rather have standard pricing, which varies from 29.80¢ per kWh to 41.35¢ per kWh, depending on size of the system and whether it is host or third-party owned. The 3MW that were set aside for these small-scale solar projects under the 2015 enrollment have not all been met, and as of March 1, 2016, 1,452kW were still up for grabs.

This under-enrollment is not the first in the program’s history. The initial goal of 40MW of renewable energy by 2014 was 1.4MW shy at 38.6MW. In 2014, both small (<25kW) and large-scale (1-5MW) solar were unable to meet their targets of 500kW and 8.5MW, respectively. Meanwhile, wind exceeded its allocation of 1.5MW, but was alongside good company, as medium-scale solar (26-250kW) also exceeded its 1.5MW allocation.

Rhode Island Solar Energy’s Turning Tides

While overall solar energy enrollment fell slightly short in 2014, 2015 saw a surge in the greater than 25kW solar category, with over 13MW enrolled in the medium (26-250kW) to large-scale solar (1-5MW) capacity projects.

Before 2015, according to SEIA, Rhode Island only had about 15MW of solar energy installed in the state. In other words, that number was almost double in 2015 just from the projects in the RE Growth program. Overall, according to a recent action plan entitled “Grow Green Jobs RI,” the RE Growth program has helped support almost 40MW of renewable energy capacity since its start in 2011, and solar is starting to lead the renewable energy pack as the largest component of the program’s projects. If it continues swimming toward the 2019 160MW goal, solar capacity in the Ocean State could increase almost ten-fold in just 5 years.

Let us not forget that this growth of solar energy is also coupled with a growth in jobs. According to the “Grow Green Jobs RI” action plan, the clean energy sector in Rhode Island accounts for 9,832 jobs across the state and has six times the job growth rate than the overall rate in the state, and the solar energy sector specifically is seeing a 20 percent increase in job growth nationwide, according to the National Solar Jobs Census.  Furthermore, according to the plan, the RE Growth program alone is expected to create 250 in-state jobs and increase state tax revenue by $1 million a year.

Choppy Seas in Massachusetts? Check out Rhode Island for Smoother Sailing

Market uncertainty in neighboring Massachusetts could steer developers to look at the Ocean State for new opportunities. At least, we hope so. The Rhode Island solar market – while smaller in installed capacity than nearby markets such as Massachusetts, Connecticut, New York, and New Jersey – is still attractive and offers above-market rates.

If you are a solar developer looking to dive into the Ocean State, contact our project finance team at finance@solsystems.com or (888) 235-1538 ext. 2 to see how Sol Systems can help secure financing for Rhode Island solar projects. Sol Systems has previously facilitated financing for solar projects in Rhode Island with feed-in tariff contracts. Check out our experience page to see our portfolio.

ABOUT SOL SYSTEMS

Sol Systems is a solar energy finance and investment firm. The company has facilitated financing for over 400MW of 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, project acquisition and SREC portfolio management. Inc. Magazine named Sol Systems on its annual Inc. 500 list of the nation’s fastest-growing private companies for a second consecutive year, ranking it No. 6 in the nation’s top solar companies in 2014. For more information, please visit www.solsystems.com.