NJ Solar Project Turns to Virtual Solar PPA for Additional Funding
Comet Land Development calls upon Alternative Utility Services, Inc.’s Virtual Solar PPA to help provide the funding needed to construct a nearly 70-acre solar farm in Upper Deerfield Township, NJ.
May 28, 2013–A solar photovoltaic array has been approved and fully permitted for construction on Silver Lake Road in New Jersey’s Upper Deerfield Township. The Silver Lake solar project is welcome news for New Jersey, as the state is short on adding generation capacity. The nearly 70-acre grid-connected solar farm, rated at 12.5 MW DC, is designed to generate about 16 million kilowatt hours of electricity per year.
The project’s developer, New Jersey’s Comet Land Development, has contracted with NJ-licensed broker and energy aggregator, Alternative Utility Services (AUS) whose proprietary Virtual Solar Power Purchase Agreement (VSPPA) will be instrumental in helping provide the necessary funding to ensure the solar farm’s construction.
The VSPPA business model was co-developed by AUS and Community Green Energy, LLC. (CGE). It is designed to bridge the funding gap many solar projects are facing by providing a long-term revenue stream combined with tax incentives and SRECs. AUS has been contracted to procure customers who, by purchasing the electricity generated on the solar project, will provide that long-term revenue stream, helping ensure the project is constructed. By removing the uncertainty of variable wholesale market prices in deregulated electricity markets, the VSPPA makes the project a more stable and more appealing investment for investors and lending institutions.
“Our VSPPA is a long-term 15 to 20 year commitment by the electricity end-user to purchase the electricity generated by the solar farm,” said Fritz Kreiss, president and co-founder of AUS. “There is an investor term sheet in place that is contingent on having a VSPPA in place for funding. This provides a vehicle for fully developed solar projects, such as Silver Lake, to get the necessary financing to begin construction.”
The Silver Lake solar farm has replaced a proposed housing development that Upper Deerfield Township leaders agreed would have added further stress on the local government’s budgets. Instead, the new solar farm will generate revenue for the municipality by creating an estimated 125 project jobs during its 6-8 month construction period and producing up to 5 permanent jobs for the project for 25 years. The solar farm will also provide the environmental benefit of offsetting 7,000 tons of CO2 emissions annually while helping to relieve strain on the grid.
Community Green Energy develops and finances renewable energy and energy efficiency projects nationwide. Included among their many projects are community solar gardens, community choice aggregation and utility scale solar development. communitygreenenergy.com
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