Q: What does it cost?
A: We charge $4.50 per watt before you take the federal tax credit. If you can use the FTC, your cost is $3.15/watt. Depending on the panel sizes installed your panel price may be as low as $1,000 or up to $1,400 (bigger panels have more watts, but cost the same on a per watt basis). Your average annual savings is the same per watt you buy. By our calculations, Green Mountain Community Solar costs about the same as solar on your house or in your backyard and eliminates the permits, shading/aesthetics issues, and maintenance required of a home solar installation. Let us know your target savings on your utility bill and we’ll give you a custom quote that shows year by year your savings and what your one-time panel cost would be. There is no sales tax for solar panel purchases.
Note that this purchase price gets you panels and a license for solar-sourced, emissions-free electric credit generation. If you wish to add to your purchase the Renewable Energy Credits (see Q: below), you may do so by adding 15% to your prices. Only if you purchase your RECs can you make the statement that you’ve gone “solar, green or renewable” or use renewable energy.
Q: What is your policy regarding Renewable Energy Credits?
A: Renewable Energy Credits are tradeable, non-tangible energy commodities in the United States that represent proof that 1 megawatt-hour (MWh) of electricity was generated from an eligible renewable energy resource.
These certificates can be sold and traded or bartered, and the owner of the REC can claim to have purchased renewable energy. According to the U.S. Department of Energy‘s Green Power Network, RECs represent the environmental attributes of the power produced from renewable energy projects and are sold separately from commodity electricity.
Our panel owners can elect to purchase the RECs for 15% of the cost of their panels. Ownership of the RECs will allow the owner to claim they have “gone solar” and are using renewable energy. These owners will get a certificate like the following:
To the extent that our subscribers (panel owners) have not elected to purchase them, we retain all the renewable energy credits (RECs) associated with our solar farms. We then sell these and use proceeds from them to keep the price per panel as low as possible. Our business experience has proven that without the value of RECs we would not have been able to build our solar arrays. The REC market is an incentive put in place by regulators and policy makers, such that developers such as GMCS can build more solar. We further believe that for every new solar panel operating and connected to the grid that that solar panel’s incremental contribution to the grid is offsetting the prior increment of electric supply – possibly natural gas, oil, hydro, or coal. Without the RECs and our sale of them, we would not have been able to build our solar farms.
Here is a primer on RECs that we follow. The take-away that we understand from the FTC guidance is as follows: unless you pay us to retire your RECs, technically, according to the FTC, you are not buying solar power (you are buying what they call ‘null’ power), nor are you buying renewable energy, you are simply buying solar panels and lowering your utility bills through emissions-free, solar generation. The solar generation credited by a utility for your panel’s generation is separate from the renewable aspect of the same kWh’s produced by the same panels. For every solar panel up and operating, some other generation source is offset – think about the spectrum of other generation energy sources: coal, natural gas, diesel, hydro, wind, nuclear. It may be that the generated electricity by the solar panels in our solar farms is possibly reducing carbon-sourced generation in New England. If you would like us to retire any RECs associated with your purchase or if you’d like to own your RECs, we’ll do so, but to offset their lost contribution to our business plan’s revenue source, we have to increase your initial panel price by 15%. Your license agreement will specify that you can do this at any time in the future at market prices.
In Dec of 2015 the VT attorney general issued a letter on this subject. Note that they reference language used in our website in their letter. Here is a copy of this letter – see pages three and four – right hand side of the table for the language they drew from above. VT Attorney General’s guidance on solar marketing
Q: Why community versus at your home?
A: According to industry research, up to 50% of homes either cannot have panels placed on them or nearby. Even if they can, placement is less than ideal – i.e., shading or wrong orientation of the panels. Some folks don’t want to cut trees, don’t want holes in their roofs, and don’t want to worry about what happens when they move. Community solar sites such as ours are selected for optimal sun exposure to get you the best possible solar production each year. Our sites are built in bulk, which allows us to keep costs down. Another benefit we at Green Mountain Community Solar offer is a buyout program.
Q: Are our prices competitive?
A: Yes, our prices are, based on our research, are comparable to the cost per watt for a residential ground-based installation in Vermont. Industry generally quotes prices on a dollar for each watt installed after a 30% investment tax credit is taken. Our 2016 price (after the ITC) is $3.15/watt (DC).
Q: What financing options do you offer?
A: As of November 6, 2015, Green Mountain Community Solar, and by extension, you if you do business with us, is eligible to offer low cost Community Solar Loans via VSECU. For a limited time, Vermont residents can take advantage of this affordable, local financing for participation in group net-metered community solar systems. This new program is made possible by a grant from the Vermont Clean Energy Development Fund. Contact us to learn more or visit www.vsecu.com/
Q: Do I own the panels? What about VT rebates and federal investment tax credits?
A: Yes. You own the panels and receive a license to place the panels in the community field. Your share of the electricity produced is credited to your GMP account. A dollar-for-dollar federal tax credit is available to individuals for primary and secondary residences for 30% of the cost of the panels you purchase to the extent that the value created by the panels you buy does not exceed your annual utility bill. If you want to invest more, there are mechanisms that provide good returns for investors with passive income – call Bruce to discuss – 802 588 2063.
There are no more VT state credits available and it is our understanding that if you live outside of VT that state’s credits also do not apply. You may capture the value of the federal tax credit as soon as you pay taxes – possibly on your next quarterly estimated tax payment or as late as April of the subsequent year. You will fill in IRS Form 5695 if you are an individual. For business filers and those receiving a K-1 from an LLC, you will fill in Schedule 3468 and calculate any limitations based on your income through Schedule 3800. If you are an investor, you will receive a K-1 for your investment share.
Any business (C Corp) that pays taxes can participate by purchasing panels, depreciating the panels on an accelerated five-year schedule and, if the business is organized as a Vermont LLC, it can receive a Vermont investment tax credit of 7.2% in addition to the federal tax credit of 30%.
Q: Does solar make financial sense?
A: At current pricing and for our typical customer, the value of the credits you earn from your panels and license would return the same as if a bank paid you approximately 7.5% interest on your money over 30 years. This equates to our initial cost being repaid after 10 years with 20 additional years of savings on top of your initial panel purchase cost. If energy prices increase faster than the 2% per year we’ve assumed (after 2018), your returns may be higher. Note that in VT, based on the State of VT’s Dept. of Financial Regulation’s Docket 14-023-S “Sun Exemption” order, community solar purchases are, for Vermonters, exempt from securities registration.
Q: Is this an Investment?
A: We are offering a product (the panels) and a service (a license). Anyone who buy panels owns their own panels and can decide how their panels are managed. As a convenience to panel owners, we offer a license whereby their panels can be located at one of our solar farms where we can facilitate the pass-through of the economic output of your panels to you. Our contract clearly states that there is NO guarantee of economic output from your panels, we just provide an estimated output based off a series of well established historical data sets for our farms’ locations and give you what we know about current and projected utility rates.
Q: What if I move?
A: If your monthly credit is associated with your GMP account number and you move to a new house, get a new GMP account number and we’ll direct GMP to credit your new account. Or, if you move out of GMP territory we’ll buy you out at fair market value, you can sell to another GMP account holder or you can donate your share to a non-profit located in GMP’s service area. Lastly, if you are not a GMP customer, your check for your panels will follow you or go to whomever you designate.
Q: Can I sell my panels and lease and assign credits to someone else?
A: Yes, we can make arrangements for the shift of credits to another GMP customer, or if you are not a GMP customer, you can re-designate to whom you’d like your checks sent. Some customers choose to donate to non profits and churches.
Q: What type of panels, inverters and racking systems will you use?
A: Solar panels are a commodity product in today’s solar market. We use only Tier 1 manufacturers. The panels are generally, but not always, designed by a European firm, and could be manufactured in either Europe or the far east. We choose these panels because they meet the top industry performance and warranty standards. Our inverters are from the largest and, to our understanding, best manufacturers. We have used SMA and Fronius at our first four and will use SolarEdge at our fifth. Each subsequent project will have its inverters selected based on installer’s supply chain coupled with our review of warranty terms and performance history. Our racking systems are ground-mounted and are either single-axis seasonally adjustable or fixed angle or some combination of the two.
Q: If I rent an apartment/condo, or house will Green Mountain Community Solar work for me?
A: Yes, our approach works well for any renter because you can choose to apply your credits to your GMP bill (if you have one) or to receive a direct check that follows you where ever you choose to live.
Q: What happens if I die?
A: Your panels are like any other asset. You can elect to will them to your heirs, and if they are GMP customers, their GMP account number would be substituted for yours. You may elect to simply assign their credit values to a relative’s GMP account before your estate is managed. You can donate them to any other GMP customer’s account including a charity or charities of your choice. If you are not a GMP customer, then your monthly check will be sent where you designate.
Q: What happens if I no longer want to be part of Green Mountain Community Solar?
A: One of the benefits of our approach is we agree to buy back your panels at Fair Market Value within 30 days of you giving us notice.
Q: What happens to my panels, lease and credits if you go out of business?
A: We have arranged for the project to make enough extra electric credits to pay for insurance and operations and we’ve put funds aside for major, scheduled repairs. The company will exist regardless of who manages it. We’ll manage it or if we go away, you’ll have right to assign a new manager and the funds set aside will compensate that manager. Your license agreement is with the company and sets forth this relationship in writing.
Q: How can I see how much electricity my share is producing each month?
A: Our farms’ production numbers are reported monthly to each panel owner and, with some of our sites, the production is updated every few hours or a link to live production numbers is made available.
Q: I’ve got land – is it valuable for solar?
A: Best sites now are rooftops. We need at least 30,000 square feet of unobstructed roof with structural load limits in excess of 60 pounds per square foot. If you have land, best is a disused gravel pit, a designated town solar area or a landfill or brownfield. Agricultural land is less valuable under current rules. Your site wants to be generally not visible from other residences or roads, wants good views of the sun, not be near any wetlands, large ponds, streams or rivers and not be prime agricultural land or have any archaeological value. Closer to GMP’s distribution lines the better. If you think you have something within these criteria, give us a call. We will discuss, look at maps, possibly walk your land. Working with us becomes a partnership. If you have customers who might subscribe as community solar participants on your land, then we are more interested.
Q: I’ve got passive gains and a federal income tax liability and I understand by investing in solar projects I can generate losses to offset my gains. How would this work for me?
A: We are happy to make arrangements with individuals like you. In the solar industry you are termed a Tax Equity Investor. Your returns can be quite good (~20% IRR) and we are happy to bring you in on future projects. Please call Bruce directly to discuss the particulars of your situation – particularly scale of investment (minimum $200k) and your level of transactional experience with these types of investments. 802 588 2063.