Solar Ownership Program uses a traditional operating lease with attractive ownership options, plus tax efficiency to provide companies with a low-cost path to ownership. The operating lease has been designed to provide Lessees with assurance that they will be treated fairly in later years, while satisfying tax rules.
The program is available to qualified businesses in all 50 states for projects ranging in size from as small as 20 kilowatts to 10 megawatts systems. Solar Ownership Program appeals to companies that cannot directly benefit from a federal tax credit, or simply want energy savings and off balance sheet accounting without a long-term commitment to a complex power purchase agreement.
RESIDENTIAL LEASE PLAN BENEFITS
-
SIGNIFICANT CASH FLOW
-
NO LEASING PAYMENT FOR 12 MONTHS
-
TAX DEDUCTIBLE
-
COST OF OWNERSHIP - SUBSTANTIALLY REDUCED.
ADDITIONAL BENEFITS
- Own a solar system after 6 or 7 years at a substantial discount from invoice price.
- No up-front equipment cost (see nominal initial lease costs in example below).
- Lease payment subsidized by Lessor's monetization of ITC and depreciation.
- No escalation of lease payments, providing a hedge against energy price inflation.
- Cash flow improved by matching low payments with energy savings.
- Utility rebates and government incentive payment for Lessee.
- Renewable Energy Certificates (RECs), FIT and PBI, where available, or Lessee.
- No complex accounting and tax records to set up and maintain
- No construction period financing costs if advance lease commencement is chosen.
FEATURES
- Solar systems: Photovoltaic (PV) and thermal (hot water), including energy storage.
- Lease period: 7 years (maximum term).
- Fixed monthly payment: No payment escalation and 100% tax deductible.
- Purchase Option at end of 7-year lease: At the greater of the then fair market value (FMV) of the solar system or 15$ of Lease Amount.
- Early Buyout Option (EBO) at end of 6th year: At a predetermined fixed price.
PATH TO OWNERSHIP
During the 6th year of the lease, the Lessee and Lessor may agree in writing upon the Lessee's purchase price for the solar system at the end of the 7th year. Otherwise, the Lessee may exercise its early buyout option at the end of the 6th year for a predetermined fixed price and obtain essentially the same low cost of ownership as purchasing the solar system for 15% of Lease Amount at the end of the 7th year. (See example below.)
The operating lease has been designed with these ownership options to provide Lessees with low cost and assurance that they will be treated fairly in later years while satisfying tax rules.
(If neither ownership option is exercised, the lease automatically extends for one year, after which Lessee at its expense must return the solar system to Lessor, as required by tax rules.)