February 23, 2020
The solar market has grown exponentially over the past decade, especially in popular solar installation areas like Long Island and New York City. With this growth, we have seen some changes in how the solar market operates, particularly with regards to financing and the types of contract agreements involved in a solar panel installation for both commercial and residential properties. What changes have occurred for the Long Island solar market?
The commercial and residential solar market has been thriving, owing to the high costs of energy and ambitious climate change goals from corporations. For years, utility-scale solar, under feed-in-tariff schemes, was a traditional method that helped boost the solar industry. The local utilities, such as PSEG-LI, issue RFPs under these solicitations, entering into a contract with the developer to purchase all of the energy generated at a fixed rate over a fixed period of time. This provided much-needed certainty for the new solar industry—particularly in terms of sponsor equity, tax equity investors, and lenders.
Now, the best Long Island solar installers are utilizing programs such as remote net metering, community solar, and private bilateral contracts (also known as power purchase agreements). Under these scenarios a developer will work with an industrial, corporate or commercial entity to sell them energy—typically at a fixed rate over a fixed period of time. A common trend we are seeing involves the terms of the contracts, which are getting compressed from our vanilla traditional 25 years to durations as short as 5 years. The solar industry has not experienced many "merchant" deals just yet but the wind industry has been exposed to many of these “merchant deals”, typically with a hedge.
If you’re interested in Long Island solar then YSG is the way to go. We take care of the entire solar installation process from start to finish, so you can focus on the savings. Contact YSG Solar today to learn how it all works and how much you could save on each utility bill. Send us an email, or call the office at 212.389.9215 to learn more.