SolarStrong, a $1 billion effort by SolarCity, U.S. Renewables Group Renewable Finance and Bank of America Merrill Lynch to put solar on up to 120,000 military housing across the country, is forging ahead, despite not winning a loan guarantee from the Department of Energy before that program ended.
Through SolarStrong, SolarCity is partnering with privatized military housing companies to install solar on housing units on bases across the country. It’s the largest residential solar project in the country. Through the project, SolarCity could install up to 300 megawatts over five-years.
Bank of America Merrill Lynch and SolarCity had qualified for a partial loan guarantee, but were unable to come to final terms by the Sept. 30 deadline, making the project ineligible for support through the program.
The project wouldn’t have been possible just a few years ago.
“In 2010, we wouldn’t have been able to do this without a loan guarantee,” said SolarCity spokesperson Jonathan Bass. “It’s proof that the [investment tax credit] and other incentives are working to make [solar] more attractive to private financing. It’s really proof of the progress the industry’s made.”
It also shows that financial institutions are becoming more familiar and less wary of investing in solar energy projects.
“As we went through the process, we put the framework for the financing in place. Even though we didn’t get the guarantee, they became comfortable enough with [the project to go ahead],” Bass said. “We were able to restructure it in a way that could work without the loan guarantee.”
The DOE’s Loan Guarantee Program helped finance billions of dollars worth of clean energy projects, but was maligned for the loan guarantee given to the now bankrupt Solyndra, which leaves U.S. taxpayers on the hook for up to $535 million in loans extended to the company.
Still the program helped SolarStrong get underway.
“It was designed to find worthy projects and bridge them with private financing. It sped up the process to get private financing,” Bass said.
SolarStrong could help SolarCity, which now operates in 11 states, move into even more markets, according to Bass. At the very least it will spur the company to add thousands of jobs over the course of the project.
“We expect the need to hire a large number of new workers. We hope to hire veterans and military family members to fill those positions,” he said.
The first SolarStrong project may already be underway. The residential SolarCity project at Joint Base Pearl Harbor-Hickam, a Navy and Air Force base, is expected to qualify for funding under SolarStrong, according to Bass.