Solar Energy Economics

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During the early part of this decade solar energy customers invested their own capital to have a solar electric system installed on their facility. These early adopters usually received a rebate to help defray about 50% of the cost of the installed system from a state agency or their local electric utility. In order for their solar investment to provide a reasonable economic return, commercial customers needed to be able to utilize the 30% solar Investment Tax Credit and five year accelerated depreciation.


Today, most commercial, institutional and industrial customers that decide they want solar electricity for a portion of their needs,utilize project financing provided through a Power Purchase Agreement (PPA) or a lease. A Solar Power Purchase Agreement (SPPA) is an arrangement where an energy user enters into a contract to purchase all the electricity to be produced by a solar electric system to be installled on their roof or an available ground location. A third party investor that can utilize the tax benefits of solar system ownership provides the capital to build the solar generation system and is responsible for all the operation and maintenance of the system. Renewable Power, as the project developer,designs the system, secures necessary approvals, arranges for the project financing with a SPPA provider, secures the materials and oversees the construction of the system with experienced electrical and mechanical subcontractors. Our role includes the responsiblity for matching the system and chosen solar technology to best fit the customer's needs, ensuring that the solar module manufacturer will be able to support the 20 or 25 year warranty on performance, making sure the system will perform as specified and satisfying the project financing source that the solar power system will deliver the projected Return on Investment to the investor(s) who will own the project.

 

 

 

 

Renewable Power, Inc.
108 Route 46 West, 2nd Floor
Parsippany, NJ 07054
Office: (973) 854-9365
info@renewablepowerinc.com