March 19, 2013 - Borrego Solar Systems, Inc. today announced that it has acquired a diverse portfolio of solar projects totaling more than 8 megawatts (MW) located throughout five areas within California. The portfolio includes two utility projects totaling 3MW under Southern California Edison (SCE)'s California Renewable Energy Small Tariff (CREST) program. The remaining projects are power purchase agreements (PPAs) with various school districts and include bundled-solar and energy-efficiency solutions. Borrego Solar acquired the projects and completed their development, providing all the necessary project financing, engineering, procurement and construction of the solar facilities.
"Many solar projects stall due to a need for upfront development capital or long-term project financing," said Mike Hall , CEO of Borrego Solar. "Our solar financing solutions help drive projects forward as we absorb the upfront costs and provide long-term financing to projects that wouldn't otherwise get done. We're proud to be a part of these projects which will generate megawatts of clean energy while creating local jobs, saving schools money and helping the utilities meet their renewable portfolio standard goals."
The two utility projects are Borrego Solar's first projects under SCE's feed-in tariff (FIT) program, CREST, which was established to provide standardized fixed price energy payments to qualifying renewable energy generators 1.5MW or smaller. Qualifying projects can sell the renewable energy they generate at a set price to SCE for up to 20 years. These CREST projects are just the latest examples of Borrego Solar's momentum in the utility-scale solar market: in January 2012, the company completed two additional SCE projects on warehouses and distributions centers in Santa Fe Springs.
Like the completed Santa Fe Springs projects, the two CREST projects are wholesale distributed generation (WDG) projects—small, wholesale generators that sell energy directly to the utility, instead of delivering energy to the user to credit a specific utility bill. Because they don't need to be tied to a utility bill, WDG projects have gained in popularity in the past few years and play an important role in advancing the solar industry by opening the market up to properties that are not necessarily owner-occupied and by providing real estate investment trusts (REITs) and property owners with a new avenue for going solar that wasn't previously available. As such, WDG projects provide states with an efficient approach for meeting aggressive renewable energy goals at a megawatt pace.
Executing project acquisitions or joint development agreements is not a new phenomenon for utility projects of 20MW or greater, but with these projects recently acquired, Borrego Solar is also demonstrating successful execution on smaller utility projects ranging from 1 to 10MW.
"Borrego Solar is very active in the project acquisition space," said Brian von Moos , director of utility project development at Borrego Solar. "Our ability to deploy development capital and long-term project financing to later-stage developments helps customers and developers bring their projects across the finish line. For most developers, financing a one-off project is a heavy lift, but our experience puts us in a position to successfully develop projects by aggregating and financing portfolios."