Community bank tax equity financing backs 11.6 MW solar portfolio

With the passage of the Inflation Reduction Act, it’s now more important than ever for community solar projects take advantage of tax equity financing. KeyState Renewable’s SOLCAP solar tax equity fund is partnering with Renewable Properties, providing tax equity funding for its 11.6 MW Fund 6 Portfolio of community solar projects.

The Fund 6 Portfolio consists of three solar projects: the 5 MW Rock Island Road solar project in ​​Gouverneur, New York and the ​​5.7 MW Bullis Road solar project in Marilla, New York—both of which were completed in the summer of 2022. The third is a nearly 1 MW qualifying facility project in Bourne, Mass., which was completed in December 2021. The three projects combined are expected to produce a total of 16,645,000 kWh of solar energy in their first year, or enough to power approximately 1,929 homes and reduce greenhouse emissions by 10,263 tons.

The recently passed IRA offers many incentives that use tax equity to enable renewable energy development, and will entice mid-size businesses and community banks to deploy capital into renewable energy projects across the U.S. KeyState Renewables and Corner Power launched the SOLCAP tax equity platform in 2019.  Since then, SOLCAP has funded 28 similar solar projects to date, totaling over 160 MWdc.

Renewable Properties has been working with SOLCAP since 2019 to develop a solar industry financing product that would lead to scale and efficiency, a partnership that led to the financing of these New York and Massachusetts projects in Fund 6. Renewable Properties and SOLCAP are now working together on new projects in Maine, North Carolina, and California.

“Great partners like SOLCAP are imperative for the solar industry to thrive,” said Allan Riska, chief investment officer for Renewable Properties. “Without tax equity investors, we would be further from accomplishing U.S. climate emission reduction targets. With so many tax equity-based incentives available to investors today, finding consistent tax equity partners can be challenging. That’s why it’s crucial to have strong investor partners like SOLCAP, which allows us to responsibly develop and own projects. Having a long-term and reliable partner is critical to building out more green infrastructure. We look forward to continuing our successful relationship with SOLCAP.”

SOLCAP has an additional 22 projects that are in development or under construction. Upon completion of all in-progress solar projects, SOLCAP projects will span seven states and it will have deployed over $200 million on behalf of its community and regional bank investors.

“Community banks are very logical tax equity investors for small-scale utility and community solar projects. Our SOLCAP tax equity fund platform allows community banks to efficiently deploy tax equity investments across a diversified portfolio of projects,” said Josh Miller, CEO of KeyState Renewables, the managing member of SOLCAP. “Renewable Properties has been a tremendous partner over the past four years. Their seasoned management team’s focus on small-scale utility and community solar projects is a perfect fit for our community bank investors. SOLCAP looks forward to being a stable, efficient source of solar tax equity for Renewable Properties for years to come.”

Renewable Properties is further expanding its portfolio with more community solar and locally-sited projects for its upcoming 32 MW Fund 7, which is expected to be fully funded in Q1 of 2023 and will continue a successful partnership with SOLCAP.