SOURCE: The Sol Project Finance Journal, May 2015

18 May 2015

SOURCE: The Sol Project Finance Journal

SOURCE is a monthly solar project finance journal that our team distributes to our network of clients and solar stakeholders. Our newsletter contains solar statistics from current real-life solar projects, trends, and observations gained through monthly interviews with our solar project finance team, and it incorporates news from a variety of industry resources.

Below, we have included excerpts from the May 2015 edition.  To receive future Journals, please email


The following statistics represent some high-quality solar projects and portfolios that we are actively reviewing for investment.

SOURCE: the Sol Project Finance Journal

*Our all-in price statistics exclude projects from Ontario, Hawaii, the U.S. Virgin Islands, and Puerto Rico where all-in prices remain over $3.50/W.



Maryland  –Despite consistently ranking in the top 15 state solar markets, Maryland has long flown under the radar for most solar developers; however, as we have said time and time again, the market deserves a closer look.  Over the last six months, solar renewable energy credit (SREC) prices in Maryland steadily rose from $130 to $170 per SREC, and build costs are relatively low. To take advantage of the attractive market conditions, we recommend acting quickly; the Old Line State’s $8.50/mWh renewable energy production tax credit expires at the end of this year.

Massachusetts – The Commonwealth has become a victim of its own success. “Too good to be true” market conditions – including community solar, remote net metering, and high SREC prices – has led solar to hit its net metering cap in National Grid territory. A task force convened to devise recommendations, but alas, recommended against an immediate cap increase. The state legislature now has a big decision to make this summer: will they completely stall solar development until a new program can be crafted, likely in 2017, or do they provide an interim solution to allow development to continue? Meanwhile, Governor Baker does not support raising the net metering caps without reigning in the SREC II market. Given the length of time needed for the legislature to resolve this issue, we recommend that developers look into NStar and other territories, or explore offtake contracts with municipal utilities.

North Carolina – Hold onto your hats, y’all – it’s going to be a wild year for North Carolina solar. Last month, Governor McCrory signed legislation into law offering a “soft landing” to the official end date for the state’s 35% tax credit. While the tax credit cliff is scheduled for December 31, 2015, eligibility will be extended for projects that are “significantly complete” but not operational by the end of 2015. This is a positive first step, but more action will be needed to prevent a dramatic step down in development activity in 2016. Meanwhile, a blow to the solar industry came in early May when the state house passed and sent legislation to the senate to reduce the size of qualifying facilities (QFs) from 5MW to 100kW in 2017, and freeze the renewable energy portfolio standard at 6%.


  • Historically low interest rates have made debt cheap for solar projects. But, if an increase coincides with the ITC cliff, solar deal margins will get squeezed. Watch this trend, and be prepared to answer if your investor asks for your plan B for when rates inevitably start to tick up.
  • It’s a new ball game for the inverter business: Chinese 3-phase string inverters are selling for less than $0.12/Watt AC, and central inverters are reportedly selling for <$0.08/Watt AC into large projects in Chile. Keep an eye on how inverter manufacturers deal with downward pricing curve balls that module manufacturers have been batting against for years.
  • Tesla’s commercial-scale battery storage product, Powerpack, has received 2,500 reservations. Each product comes in 100kWh battery blocks that can be “grouped to scale from 500kWh to 10MWh+.”  We anticipate that it will be a short while before storage is economically viable without incentives; batteries are moving down the cost curve rapidly.
  • Arizona cold front: Solar developers in Arizona are increasingly looking out of state for opportunities as opposition from AZ’s leading utilities mounts. While the highly publicized solar service charges primarily impact the residential market, commercial solar developers face a chilly utility attitude, lack of incentives, and low retail prices making it difficult to bring deals to the finish line.
  • Once again, rumors are flying around about a module shortage. Have no fear; these [seemingly annual] announcements partially serve to encourage buyers to procure modules prior to an end-of-year rush. In most cases, shortages occur when a project is closed in late Q3 or early Q4, resulting in short timelines for EPCs to complete projects by calendar year-end deadlines. Manufacturers seeking to accurately forecast their year-end production requirements may issue potential shortage announcements to encourage clients to lock in allocations. Plan ahead for the race toward 2017 to beat the “shortage.”


Sol Systems is a solar energy finance and investment firm. The company has facilitated financing for 200MW 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. 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

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Sara Rafalson

Sara Rafalson