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"Military Deal To Double The U.S.'s Rooftop Solar Installations"

Solar Oregon professional member, SolarCity, is undertaking the United States’s largest residential solar project, a $1 billion, 371-megawatt program to put 160,000 photovoltaic installations on privately owned military housing and other structures in 33 states. If built out, the five-year project, dubbed SolarStrong, would double the number of solar installations in the U.S. The project is being financed by Bank of America Merrill Lynch and USRG Renewable Finance and underwritten with a partial $344 million federal loan guarantee.

"Military Deal To Double The U.S.'s Rooftop Solar Installations"

Solar City is a professional member of Solar Oregon.

By Todd Woody
Forbes
>> click here to read original article

Silicon Valley startup SolarCity is undertaking the United States’s largest residential solar project, a $1 billion, 371-megawatt program to put 160,000 photovoltaic installations on privately owned military housing and other structures in 33 states.

If built out, the five-year project, dubbed SolarStrong, would double the number of solar installations in the U.S. The project is being financed by Bank of America Merrill Lynch and USRG Renewable Finance and underwritten with a partial $344 million federal loan guarantee.

SolarCity said SolarStrong is expected to create the equivalent of 6,000, 1-year jobs that the company aims to fill with veterans and members of their families.

“This is the largest domestic residential rooftop solar project in history,” Energy Secretary Steven Chu said in a statement on Wednesday.  “This groundbreaking project is expected to create hundreds of jobs for Americans and provide clean, renewable power to our military families. It can also be a model for other large-scale rooftop solar projects that help America regain its lead in the solar industry.”

The announcement was spot of good news following the bankruptcies of three U.S. solar companies in recent weeks.

SolarStrong has its roots in a 6-megawatt residential installation at a Tucson, Ariz., military base that SolarCity completed in 2009.  The company then looked at opportunities to vastly expand the military market, according to Lyndon Rive, SolarCity’s chief executive.

“We liked the program and thought we could scale it but looking at the economics in many of the states with military housing it just didn’t pencil,” Rive said in an interview Wednesday. “You have to look at the cost of equipment and the cost of capital. If we could reduce the cost of capital could we make these things pencil?”

The answer was yes and it was provided by a U.S. Department of Energy program called the Financial Institution Partnership Program, or FIPP, that guarantees up to 80% of a loan issued by a private lender for a renewable energy project.

FIPP is different from the federal loan guarantees received by companies like solar startup Solyndra, which filed for bankruptcy on Tuesday, and which amount to a direct cash grant. Under FIPP, private lenders – in this case, Bank of America and USRG Renewable Finance – put up the money but are indemnified by the government if a project fails.

But the guarantee lowers loan costs and that was enough to make SolarCity’s project viable in states that don’t offer generous subsidies for going solar, Rive said.

“For the most part, solar in the U.S. is concentrated in 11 states,” he noted. “This will bring solar to 33 states.”

SolarCity will lease the photovoltaic systems to the owners of military housing and other buildings on 24 bases. Rive said SolarCity is still negotiating with tax-equity investors who would put money into the project in exchange for taking a 30% tax credit on the installed systems as well as other partners. But he said he expects work to begin around October.

The company already has started a 2,000-home project at a military base in Hawaii.

 
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