March Solar Project Finance Statistics

20 Mar 2013

Every month, Sol Systems distributes a newsletter, the Sol Systems Project Finance Journal, to our community of solar developers and investors. The journal features solar finance statistics, trends, industry news, and SREC market information. We gather this information from our relationships and experience aggregating SRECs and financing commercial and utility scale solar projects.

We have included excerpts from our March Project Finance Journal below. If you have any questions about this information, wish to receive our monthly newsletter via email, or have a solar project in need of seeking financing, please contact our team at  We would love to hear from you.

Project Finance Statistics

Characteristics of “Hot Projects”
Capacity: 50 kW – 7 MW
Average Capacity: 1,242 kW
Competitive all-in costs range currently range between $2.05 – $3.05 *

  • <500 kW: $2.75-$3.01/Watt
  • 500 kW – 2 MW: $2.50-$2.71/Watt
  • >2 MW: $2.05-$3.05/ Watt

*Does not include carport projects which can be competitive at rates from $3.60-$3.73/Watt or Hawaii projects where competitive costs range from $4.25 – $4.80

Average PPA rates:

  • CA: 19.35 cents/ kWh with 3% escalator
  • CT: 9.0 cents/ kWh with 2% escalator
  • HI: 25.0 cents/ kWh with 2% escalator
  • MA: 10.0 cents/ kWh with 1% escalator
  • NY: 10.7 cents/ kWh with 2.5% escalator

Average Feed-in Tariff Rates:

  • CA: 12.6 cents/ kWh
  • RI: 28.4 cents/ kWh
  • VT: 24.0 cents/ kWh

Trends and Observations

NYSERDA Projects Need Higher PPA Rates

Many developers in our network are receiving notices of grant awards for the NYSERDA project applications that were submitted last September; these winning applicants may receive as much as 30-40 cents from NYSERDA. While the NYSERDA incentives seem rich compared to other solar incentive programs, we are finding that it is difficult to make many of these projects pencil for investors. NYSERDA project economics have forward-weighted return profiles, but cash income is very low in year 4 and beyond due to relatively low PPA rates (which are driven by low electricity prices in New York). Based on our observations, we expect some project fallout in the NYSERDA queue for developers that cannot attract financing, particularly for developers who bid in with prices in the $0.30-0.37/ kWh range. In NYSERDA territory, our investors are most interested in projects with low EPC costs (below $3/watt), along with 20-year PPAs with $0.10-$0.12+/kWh rates. To ensure the best chance of attracting financing, we encourage developers in NYSERDA (and every market) to negotiate hard with host customers for higher PPA rates and escalators.

Wanted: Small Projects in Small States

Thanks to Connecticut’s ZREC program and Rhode Island’s feed-in tariff, qualified smaller projects in these New England states have attractive margins. Developers with Connecticut projects in the 50-100 kW range, and Rhode Island projects in the 50-500 kW range that expect to receive state incentives should contact the Sol Systems team for assistance in securing financing.

Hawaii Still Hot…for Hosts with Good Credit

The combination of the 35% state tax credit, good insolation, and high electricity costs help Hawaii retain its status as one of the strongest solar markets in the country. Many businesses, including travel-related businesses and non-profit organizations, are now interested in adding solar to their facilities, but that old devil, host credit, still lurks in the shadows. As always, investors want to see three years of audited financials, proving that the organization is in strong financial standing before pursuing these projects.

SREC Roundup

In March, Sol Systems once again increased pricing for three and five-year SREC strips for systems certified within Washington, DC. All other fixed pricing remained the same due to relatively stable market conditions.

If you are interested in our Sol Brokerage clear prices and price movements on the spot market, please view our SREC clear prices, which are updated quarterly. Sol Systems also offers its network the opportunity to view historic SREC marks and model future pricing using their own market assumptions. To utilize our SREC supply and demand model, please view our SREC Analytics tool.

About Sol Systems

Sol Systems is a boutique financial services firm that offers investor clients direct access to the renewable energy asset class and provides developers with sophisticated project financing solutions. Founded in 2008, Sol Systems focuses on meeting the most critical needs of the industry, including SREC monetization, capital placement, tax equity, and New Market Tax Credits. To date, the company has arranged financing for thousands of projects and facilitated hundreds of millions in investment on behalf of Fortune 100 companies, private equity, family offices and individuals.

For more information, please visit

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Natacha Kiler

Natacha Kiler