What is A Solar Power purchase agreement (Solar PPA)?
A solar PPA, or power purchase agreement, is typically an off-balance sheet financial arrangement through which an energy consumer (commonly referred to as an off-taker) allows a third-party developer to develop, construct, operate and maintain a photovoltaic (PV) system on its property, at no upfront cost. The off-taker then agrees to purchase electricity from the system’s owner, over a predetermined period. The off-taker will typically a lower rate than the existing utility rate while benefitting from a more sustainable source of power and the ability to meet sustainability initiatives.
PV systems are typically roof-mounted and often supplemented by either ground mount or parking structure systems depending on the energy consumers’ energy needs.
Solar PPA agreements typically offer 15-30 year terms, while the developer will remain responsible for the operation & maintenance of the PV system throughout this term. Customers have the option to either ask that the system be removed, purchase the solar energy system from the developer for Fair Market Value, or enter into a new solar power purchase agreement at the conclusion of the original term.
A solar PPA allows energy consumers to bypass restrictive upfront costs, preserving capital for the organization. When paired with the integration of EV Charging Stations, businesses, and tax-exempt entities can realize immediate savings while also benefiting from charging revenue. While a PPA will almost always be cash flow positive on day one for the energy consumer, a new offering by SCF provides the option for off-takers to pay zero solar electricity costs for the entire first year of operation.
Adding EV charging stations to a solar PPA agreement can further enhance the benefits of renewable energy adoption. By combining solar power and EV charging, organizations can offset even more of their carbon footprint and take a more holistic approach to sustainability initiatives. Including EV charging can also provide an additional revenue stream, as drivers pay to charge their vehicles. As the popularity of electric vehicles continues to rise, having EV charging stations can also be a draw for customers, tenants, and employees, showcasing an organization’s commitment to sustainability and innovation.
Why do commercial Businesses & Non-Profits choose Solar + EV Charging PPAs?
Commercial businesses and non-profits are choosing solar + EV charging PPAs as an effective way to save money on energy costs and meet sustainability goals. With a solar + EV charging PPA, energy consumers pay for the electricity generated by the solar array and EV charging stations, through a service agreement, for a fixed period of time. This allows customers to save money on their monthly electric payments, while also generating revenue from EV charging.
Unlike traditional loans or leases from lenders, a solar + EV charging PPA typically does not affect an off-takers balance sheet or borrowing capacity. This makes it a low-risk and easy option for organizations looking to invest in clean energy and meet sustainability commitments.
SCF’s utilizes a short-form Commercial Power Purchase Agreement for all of its projects, which is a standard Solar + EV Charging PPA. By integrating EV charging stations with solar power, businesses and non-profits can reduce their carbon footprint, save money on energy costs, and generate revenue from EV charging.
Why Choose SCF for Solar PPAs?
SCF’s approach to Solar + EV Charging PPAs addresses two pain points for most developers and contractors: small projects, and unrated off-takers. The SCF Suite allows project partners to expedite Solar + EV Charging PPA projects with a level of certainty and predictability. With the ability to price and underwrite projects in minutes instead of days, the SCF Suite allows quick responses to urgent leads, leading to an ever-increasing deal flow.
In addition to the benefits of Solar PPAs, incorporating EV charging stations into the PPA can provide businesses and non-profits with additional savings and revenue streams. By offering EV charging services to employees, customers, and the public, organizations can offset their energy costs while also generating revenue from charging fees.
SCF’s team delivers an efficient and reliable solution through multi-skilled team members, spanning multiple industries. Its award-winning employees have worked in industries including utilities, banking, tech, engineering, real estate, and solar. SCF offers a turnkey Solar + EV Charging PPA financing/takeout structure for commercial and industrial (C&I) PV and energy storage projects. This allows its EPC and development partners to complete portions of projects they are experts in, while SCF executes the rest.
Benefits of a solar + EV Charging PPA:
The SCF Suite
With just 8 project variables, receive indicative pricing in real-time.
- Solve for PPA Rate
- Solve for Build Cost
- Solve for Lease Rates
- Try several iterations
- Identify economic viability instantly
As project parameters are input, documents & agreements can be auto populated, allowing for immediate download & use.
- Sales docs
- Term Sheets
- Diligence Checklist
A project checklist and existing file name architecture allow for an easy to use data room and an easy to manage project.