The document summarizes a working group established by NYCEDC and the Mayor's Office to address barriers to solar financing in NYC. The working group will evaluate best practices, analyze the NYC building stock and solar market needs, and develop a plan to facilitate financing models like power purchase agreements and solar leases that offer solar with no upfront costs. The initial focus is on third-party ownership models to simplify incentives and allow customers to pay for solar electricity monthly. Other innovative financing models may also be explored.

1. SMART NY: Solar Financing
NYC Solar Summit
June 7, 2012
David Gilford, Assistant Director

2. SMART NY: Financing Options Working Group
NYCEDC and Mayor’s Office partnering to facilitate solar financing
 Lack of financing slows solar adoption
Why Does
Financing  Removing barriers is both an environmental and
Matter? economic opportunity
 Understand and address financing barriers, including:
What’s Our – Complexity
Goal? – Lack of information
– Regulatory or policy constraints
1. Evaluate financing best practices and barriers
What Will
2. Analyze market needs and opportunities
We Do?
3. Develop plan to facilitate financing
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3. Why solar financing matters
Upfront costs are a major barrier to solar market growth
 Building owners face high upfront
costs for a long-term return
 Incentives and funding can be
complex and hard to access
– Federal: Investment Tax Credit,
Accelerated Depreciation
– State: NYSERDA, other tax
credits/exemptions
– Local: property tax abatement
– Utility: net metering tariffs,
energy efficiency programs
 No financing program or model has
emerged as a “silver bullet”
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4. Task 1: Evaluate Financing Best Practices and Barriers
Working group will research and diagnose issues
Research Identify Diagnose
 Research current  Identify best practices  Diagnose the primary
status and survey solar for third-party financing barriers
developers and ownership and other facing solar
financial institutions: financing models:  Prioritize barriers
– Customer – Locally based on their impact
feedback – Regionally on market growth
– NYC compared to – Nationally
other markets
– Impact of policies,
regulations or
tariffs
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5. Task 2: Analyze Market Needs and Opportunities
 Gather data from Con
Edison, NYSERDA, City
agencies and the NYC
Solar Map
 Analyze data to evaluate
New York City’s building
stock according to the
economic feasibility of
solar
 Segment the potential
market according to likely
financing needs and
opportunities
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6. Task 3: Develop Plan to Facilitate Financing
 Develop a detailed plan to
address barriers and
promote the highest-
potential financing models
 Work with developers,
financial institutions and
other local stakeholders to
facilitate piloting third-party
ownership or other financing
models in New York City
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7. Initial focus is on third-party ownership models
PPAs and leases offer solar with no (or low) upfront costs
Power Purchase Agreement (PPA) Solar Leases
“Pay by the kWh” “Pay by the month”
 Partial upfront pre-payment for  Typically no money down
electricity (often optional)  Customer pays flat monthly fee to
 Customer pays for actual solar lease the solar PV system
power generated  Monthly fee may increase at
 Fixed electricity rate or yearly predetermined rate
percentage increase  Long-term, transferable agreement
 Long-term, transferable agreement
 Potential advantages over direct bank loans:
– Simplifies incentives, tax benefits and maintenance
– Enables paying for electricity by the month, as usual
– Mitigates reliability and performance concerns
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8. Looking forward, other innovative models will be explored
 Crowdfunding: individuals invest small amounts of
money directly in community solar projects
– Startups like Solar Mosaic are bringing the
“Kickstarter” model to solar
 On-bill financing: utility collects payments on behalf of
third-party system owner, with generally no increase to
customer’s monthly bill
 Property Assessed Clean Energy (PACE):
municipality facilitates a low-interest loan that is repaid
over time through customer’s property tax bills
– Roadblocks remain for residential PACE, but
Florida launched commercial solar PACE program
in April 2012
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9. Thank you
“Generating reliable and affordable solar energy is both
a public good and a national goal.
A necessary component to achieve this vision is the
availability of scalable, low-cost financing.”
- US Department of Energy, SunShot Grand Challenge
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