One of the most common barriers for commercial property owners who want to install a solar energy system is the age and condition of their roof. Minor repairs such as seams and flashing can easily be addressed, but many owners need more significant upgrades and some require complete replacements. But what if adding a solar energy system to your roof could help pay for roof upgrades, and in some cases an entire new roof?
Starting this fall, Massachusetts is introducing a new solar incentive program called Solar Massachusetts Renewable Target program (SMART) where building owners will now have the option to install “stand alone” projects where the energy is sold directly to their utility at a predetermined price for 20 years.
This means property owners don’t have to find tenants or other off takers for the energy produced. Also, it eliminates the need for power purchase agreements and billing to get compensated for the energy produced. Under the current SREC program the incentive is paid quarterly and the value is not fixed but subject to the market pricing that changes quarterly. Under the new SMART program, the incentive is included in the monthly tariff payment to the array owner by the utility and is fixed for 20 years! Also the “customer” for the power is an investment grade credit entity, your utility. The combination of an investment grade credit and fixed monthly payments has allowed solar developers to structure deals for property owners that include the costs of roof upgrades and even new roofs with the solar project.
Let’s take a closer look at how this works. Under the new incentive program, a standalone project essentially means that a solar energy provider is leasing your rooftop. The solar company will own the system and be responsible for operating and maintaining it, you are just leasing them your rooftop. Because the project’s “off taker” is now the utility, this allows solar providers to secure better terms for the financing of their projects. In turn, this allows solar developers to give more options to building owners including ongoing lease payments, or in some cases, an entire upfront payment that could provide enough cash for a new roof.
The new SMART program will reward property owners for investing in solar with a fixed monthly incentive that is truly “bankable.” So, if you have been considering exploring the benefits of solar energy, or if your need a new roof on your building, the timing has never been better! Contact a qualified solar provider and they can work with you to better understand your options under the new SMART program.
Scott Howe is partner, senior vice president of Solect Energy, Hopkinton, Mass.