A presentation on expediting Community / Shared Solar Project Development for the American Solar Energy Society Solar 2016 Conference

1. SHARED SOLAR: THE
PROMISE, PROBLEMS,
AND PATHS FORWARD
AUTHORS:
AARON CLAY – SUNSWARM
THOMAS MILLHOFF – HELIO MICRO UTILITY
EXPEDITING SHARED SOLAR PROJECT
DEVELOPMENT
PRESENTED JULY 13, 2016
FOR THE AMERICAN SOLAR ENERGY SOCIETY’S SOLAR 2016
CONFERENCE

2. THE PROMISE:
ECONOMIC, EGALITARIAN CLEAN ENERGY
Benefits
• Project
Scale
• Best Siting
• Huge new
Markets
• Retail
Rates
Ownership
• Utility
• Offtaker
Equity
• SPE / TPO
Markets
Active:
● CO, MN,
WA
Emerging:
● CA, NY
Pilots:
● DC, MA,
MD

3. THE PROBLEMS:
INCREMENTAL DEVELOPMENT & OPERATING COSTS;
NASCENT POLICIES
Site
Control
Revenue
Contract
IX NTP
Construc
-tion
COD
Opera-
tional
Finance
& EPC
+ VNEM Policy
+ Shared Solar Policy (including TPO)
+ Portfolio Economic Modelling
+ Offtaker Education & Marketing
+ Offtaker Aggregation / Cost of Sales + Billing/Admin
+ New Project Doc’s + Mulitple Credit Assessments + Bill Reconciliation
+ Offtaker Churn
Additional Shared
Solar Challenges
 Insolation  Offtaker Negotiations
 ACOE  Quality Project Documents
 NEM Policy  IX Fees, upgrades, delays
 PPA/TPO Policy  Investor outreach, education
 Incentive Policy  Final permitting hurdles
 Zoning, Environmental  Inspection, PIS delay
 Financial Modelling  Asset Mgmt
Conventional C&I
Solar Challenges

4. PATHS FORWARD: PARTNERS
Financing
• Feasibility / Modelling
• Engineering / IX
• Incentives
Project Administration
• Pre Offtaker Aggregation
• Bill Reconciliation/ Allocations
• Offtaker Churn/ Optimal Capacity

5. PATHS FORWARD: MARKETS
Rates and policy can offset weak insolation…
Markets
• Insolation + ACOE
+ Incentives
• NEM Policy
• PPA/TPO Policy
• VNEM Policy
• Shared Solar
Policy

6. PATHS FORWARD: MARKETS
Shared Solar requires Stable NEM policy
Markets
• Insolation + ACOE
+ Incentives
• NEM Policy
• PPA/TPO Policy
• VNEM Policy
• Shared Solar
Policy

7. PATHS FORWARD: MARKETS
Shared solar will prosper best in PPA/TPO-friendly markets
Markets
• Insolation + ACOE
+ Incentives
• NEM Policy
• PPA/TPO Policy
• VNEM Policy
• Shared Solar
Policy

8. PATHS FORWARD: MARKETS
Virtual NEM fosters true Shared Solar economies
Markets
• Insolation + ACOE
+ Incentives
• NEM Policy
• PPA/TPO Policy
• VNEM Policy
• Shared Solar
Policy

9. PATHS FORWARD: MARKETS
Focus development where Shared Solar complements existing
economics & policies
Markets
• Insolation + ACOE
+ Incentives
• NEM Policy
• PPA/TPO Policy
• VNEM Policy
• Shared Solar
Policy

10. CASE STUDY – CALIFORNIA
(2013) Green Tariff Shared Renewables Goal: 600MW
(2015) Decision 15-01-051 Rulemaking
• Green Tariff: Utility Procurement of Green Energy sold at
premium
• Enhanced Community Renewables: 3rd Party Developer
• Requirements:
• Pre-approval
• Marketing & Outreach
• Financing & Procurement
STATUS: Part IV proposal released;
No current ECR projects, RAM 8/31/2016
Recommendations: Best financing for ECR/ EJ projects

11. CASE STUDY – MINNESOTA
(2007) Next Generation Energy Act: 25% renewable RPS by 2025
(2013) Utilities may use Value of Solar (VOS) tariff instead of NEM
• “Value-of-solar” rate = Value (Utility + Customer + society + env.)
3.2 kwh valued fuel cost of solar (avoided cost of natural gas)
• Xcel objects to VOS methodology
(2015) 17 active, 46 approved (≈43 MW)
(2016) Issues: Contract length, Messaging, Utility approval delays
Status: Utility retail rate purchase; No cap; 800+ MW in queue
Recommendations: Ensure strong capital financing partners,
Flexible feasibility modeling

12. CASE STUDY - New York
(2012) Hurricane Sandy Devastation- 2nd most costly in US history
(2015) Reforming Energy Vision Initiative (REV)
Requirements:
Phase 1: October 19, 2015 - April 30, 2016
• 20% LMI inclusion in Applications: No projects
Phase 2: May 1, 2016 → present
• NYSERDA Pilot
• Community outreach strategy/ Marketing
Status: Rule adjustments, LMI preferences, 5 Billion Green Bank Fund
Recommendations: Utilize financing partners for state incentives
and organizational partners for community outreach

13. PATHS FORWARD: MARKETS Conclusions
• Develop markets with long-term
energy goals and regulatory rules
to limit policy risks
• Have strong structured financing
partners
• Utilize local/community partners
for added regulatory approval
preferences
• Partner to aggregate subscriber
base early for easier financing and
optimized capacity levels
• Plan for back end administration
support