Power Purchase Agreement (PPA)
Third party investors have a strong interest in solar. With the available federal tax incentives and SRECs, a third party investment partner will pay to install and own the solar system on your property. Through the PPA you buy only the kilowatt hours the system produces.
Solar Benevolent For-Profit LLC
Third party for-profit investors are often interested in arrangements other than a PPA, to take advantage of the federal tax incentives that tax-exempt entities can not. There are numerous legal and regulatory securities and utility tariff hurdles associated with this model. (As a result, power purchase agreements are not yet even available in Missouri.)
However, there is a unique rarely utilized arrangement which involves creation of a benevolent for-profit LLC partnership. This method, complex & time-consuming, is as-of-yet untested in Missouri or Illinois. But the possible benefits to the community and the benevolent process itself, make it worth further investigation.
North Carolina Interfaith Power and Light is an organization of faith-based congregations working on climate change. They have put together an excellent guide that describes 2 congregations that successfully used the benevolent LLC approach. Learn more here about the 2 NC case studies.
If you decide to dive into the really technical aspects of the benevolent LLC model, A Guide To Community Solar: Utility, Private, and Non-profit Development, was a seminal document sponsored by the National Renewable Energy Lab and originally published in 2011. While its focus is on Shared Arrays and for-profit investors, the discussion of Special Purpose Entities (starting on page 12) provides a bit more insight about how an LLC can work.
Municipal Loans
City of Columbia Power & Light Solar Loans
- Must be CP&L customer and the property owner
- Homes must meet minimum insulation requirements to be eligible
- Loans up to $15,000 for residential and $30,000 for commercial
- Good payment history with CP&L and current on property taxes
- Up to 10 year loan term;
- Very Low Fixed Interest Rate
- No prepayment penalty
State Loans
Through this State Treasurer’s program, participating banks and credit unions offer 2-3% interest loans to both individuals and businesses. This program has been infrequently used for solar electric projects due to certain limitations. However, the program is well-funded and worth looking into.
MO Linked Deposit Alternative Energy Loans
