The permit and inspection process can be lengthy and difficult, often leading to costly expenses before a project can get under way, especially if design and engineering work is included. Local governments must issue a permit before any PV system is installed, and inspect it before connection to the grid. Additionally, zoning permits as well as engineering and safety code permits are required; all of that adding up to a lot of potential hassle and expense.
Many states have made moves towards easing the permit process however, such as California which recently announced the Solar Automated Permit Processing (SolarAPP) initiative, a program that should ease the permitting process and reduce expenditures of solar projects.
Beginning with the aforementioned initiative, SCF has analyzed some of the most progressive states and the steps they’ve taken to ease the permit and inspection process for solar developers:
With the goal of making the permit process more routine, straightforward and efficient, the Solar Energy Industries Association (SEIA) and The Solar Foundation revealed the brand new initiative, SolarAPP.
The plan will attempt to enact reforms such as:
- Creation of a system design standard for solar projects that qualify;
- Listing established equipment standards for solar projects that go through the initiative process;
- A program to enact skills and safety training/certification for solar installers in order to ensure that their projects comply with codes and laws, removing the need for the traditional permit process;
- Establishing an administrator to guide implementation of the plan, overseeing state and local jurisdictions and utilities as SolarAPP is put into place.
- An online platform for local governments to sign up and vet proposed systems, lowering the cost of approvals.
The implementation and hopefully the success of this program should help to spur other states to enact their own reforms of these processes.
New England Partnership
Massachusetts, New Hampshire, Connecticut, Vermont and Rhode Island have forged an alliance, the “New England Solar Cost-Reduction Partnership.”. Together they work to grow the regions solar market through cost reductions for permitting and connections. Additional permitting processes still exist for the states under the partnership.
While historical districts may have extra paperwork required, solar PV projects for residential units of 4 or fewer require only a short-form application in Boston, while long-form are required for all others. Building and electrical permits and inspections are also required in order to verify state and local code.
While no single standard for solar installations currently exists, the state did develop a guide for rooftop solar panel installers.
Building permit fees were waived in 2011, after a law passed applying to installations below 5 kW of capacity. Municipalities are also required to include residential solar systems in their building permit process. Training programs were also authorized state-wide to inform officials on the permitting process for solar installations.
With an expedited permit process for smaller PV systems (15kW or less) as well as net-metered systems Vermont is making strong progress towards being a leader in ease of solar permitting.
Rhode Island has stated their objectives to be refining, combining and deploying innovative tools and practices from Connecticut and Massachusetts Rooftop Solar Challenge I (RSC I) projects, and from other earlier efforts in those states and Vermont.
States Outside the Partnership
With an expedited permit process in many municipalities and a 13-step checklist to determine eligibility for the quicker process, New York is making steps to improve permitting for solar PV installations.
New solar projects in New Jersey have to be registered with the SREC Registration Program before the project starts in order to be eligible to earn credits, while local permit offices often require building/electrical permits. Local utility and jurisdiction must also complete inspections before the PV system can be connected to the grid.
While state ordinances have not yet passed for permitting processes, local entities have their own sets of rules. The state is quickly moving in a solar-positive direction however, and will most likely see legislation to improve the state-wide permitting process in the next few years.
While inconsistent across jurisdictions, some parts of Colorado make the permit process very easy, although some jurisdictions make it quite a bit more difficult.
How SCF Can Help Your Solar Project
Sustainable Capital Finance is a commercial & industrial (C&I) solar financier, providing PPA solutions to EPCs and Developers for projects as small as 100kW.
While the MASH (Multifamily Affordable Solar Housing) program is currently closed to new applicants, there is a new solar PV state incentive in town: Solar on Multifamily Affordable Housing (SOMAH); a program designed to help tenants in low-income housing benefit directly from solar savings.
The program works by giving credits to low-income tenants through virtual net metering (VNEM) tariffs, which allow system generation bill credits to be allocated among housing occupants. Each solar project will provide tenants with at least 51% of VNEM credits, saving them a significant amount of money and increasing good-will towards solar energy (one of the main intents of the program).
Property owners will still be eligible to receive the 30% Federal Incentive Tax Credit upon purchasing the solar system, and 49% of VNEM tariffs will go to common areas.
One interesting detail regarding SOMAH, the program is funded through California’s cap-and-trade greenhouse gas program, as opposed to its predecessor MASH which was mainly funded through large investor-owned state utilities.
Which properties are eligible for SOMAH?
There are several non-negotiable requirements that must be met in order to qualify for SOMAH, these are the important ones:
- The property in question must be an existing building.
- At least 1kW of electricity must be produced by the installed solar system, and no more than 5MW, alternating current rated peak electricity.
- Property must be in a designated disadvantaged community (as defined by CalEPA), or 80% of the apartment’s households must earn at or below 60% of the median area income.
- The building’s affordability restrictions must have at least 10 years remaining on the term.
- You must separately meter units, and they must be eligible for a virtual VNEM tariff.
- Your utility providers must be Pacific Gas and Electric Company, San Diego Gas & Electric Company, Southern California Edison Company, Liberty Utilities Company, and PacifiCorp Company.
Building owners are also unable to raise rent under the contract, which ensures that the system will not create any additional costs for renters, including utility allowance adjustments or other such methods of rent increase.
Timeline and funding:
The $1 billion program, which provides up to $100 million annually in incentives, will serve multi-family buildings with funding for up to 10 years. The target has been set at 300 megawatts of generating capacity by 2030, which means this program will likely be around for quite some time. SOMAH officially began in August 2018, and although there are still a few steps left before it is rolled out for applications, the program should officially begin in mid-September of 2019.
How SCF can help developers and owners make the most of SOMAH?
Sustainable Capital Finance is the perfect partner to help developers and multi-family home owners take advantage of SOMAH. Although applications will not be open until around September 2019, this is a well-funded program that will almost certainly stick around until at least 2030. If you are evaluating a project for the SOMAH program, or are interested in learning more, don’t hesitate to reach out to Dan Holloway @ firstname.lastname@example.org.
With over 15,000 attendees year after year, Intersolar is one of North America’s largest solar exhibitions for its industry and partners. SCF had the opportunity to walk the floor this year and here’s what we learned:
1) Intersolar has grown with the solar market
Where once small shop entrepreneurs gathered in line to inspect racking attachments to increase their crews’ installation speeds, business professionals and executives speculate on the future of the industry and the challenges of a mature market. The vendors are largely the same, but their old products have been refined and perfected. This is a great accomplishment and shows monumental progress for an industry that has tripled in size since 2010.
Solar industry progress is outstanding; albeit it comes with issues that are ever present when a new industry flourishes. The problems are new and different. The focus is now on ways to incorporate solar into our outdated grid, which is why there is now an entire floor dedicated to energy storage. At stands brimming with developers seeking to get ahead of the curve, storage companies hawked their products to customers who have tried and failed to effectively implement a cost-effective solution to demand charges and utility push back.
Everyone knows storage is the big question; and the teams that master it first will be in a league of their own.
2) Software is Taking over the Origination Game
One thing that has become evident over recent years of attending the Intersolar Show is that a new breed of software providers are providing new value added services that are dramatically reducing the workload to the EPC/Developer marketplace. The landscape of origination is changing rapidly, and it appears that software is at the forefront of this new paradigm shift.
Companies like Aurora have reduced the work it takes to design large and complex commercial solar systems to simply entering an address and performing a handful of mouse clicks. Other companies are using large scale public (and private) databases to estimate building energy usage and electricity pricing to dramatically reduce the amount of time it takes to provide customers with detailed proposals. Still other companies are using software to target the best properties for land leases for Greenfield development. All of these new platforms are combining to drive down the cost of customer acquisition which in turn will drive down overall installation costs. With that being said, it’s an exciting time to be in the solar market.
3) Meeting Clients and Partners Face to Face is Always the Best Part
Participating in Trade Shows can impart numerous benefits. While they can be costly to attend, a lot of value to be derived if proper planning and preparation is undertaken. Most people attend shows in hopes of learning more about their industry through seminars, or walking the show to experience new products, services or industry trends. In SCF’s experience, the most valuable aspect of visiting industry trade shows is the in-person meetings that take place at these events.
Getting to meet with people in-person, and learn about their companies, projects, and personal lives is invaluable in creating rapport, and ultimately trust. In an industry known for terms like the “Solar Coaster”, and the “Wild West” it is vital to form long term relationships with those you partner with. There are numerous attendees at these shows that find the face to face meetings so valuable, that they never actually set foot on the show floor, and simply purchase a show pass so that they can set up meetings with their clients and prospective vendors. At shows like Solar Power International, you will rarely have an opportunity to meet with as many partners in one place.
There is a lot that can be learned at any industry trade show, but the in-person meetings have the longest-lasting impact.