PSE&G’s Solar Loan Program provides solar system owners with an innovative form of financing that can fund a significant portion of the upfront cost of a commercial solar system. The Program also provides system owners with a fixed price for all SREC’s generated, eliminating the key risk of SREC price volatility.
The two previous Solar Programs have facilitated the installation of more than 71 MW of solar capacity in New Jersey. PSE&G Loan III will seek to finance the deployment of 97.5MW of new solar photovoltaic installations over the next 2-3 years.
The Solar Loan Program provides participating solar system owners with 10-year term loans that can be repaid with the SRECs produced by the system (or with cash).
The amount of the loan is determined by the expected SREC generation of the system, in conjunction with the specific SREC floor price and the interest rate of the loan. The SREC floor price will be determined via a competitive solicitation process whereby participants will submit floor price bids and PSE&G will award available loan capacity on a competitive basis.
The Solar Loan is essentially a means of “forward-selling” a solar system’s future SREC production at a guaranteed price level. The nominal interest rate of 11.179% implicit in the Loan is quite high, but must be viewed in the context of the SREC price certainty that the Loan provides.
Unlike Solar Loan Program’s I & II, there will be no “call option” in Solar III, and the loan terms will be set at 10-years only.
PSE&G has announced that there will be 4-6 competitive solicitations per year, with the first round beginning on October 31, 2013 and with applications due by November 12, 2013.
For large commercial entities, optimal roof-mounted project sites will have at least 40,000+ SF of usable roof area, with limited shading characteristics and a new or relatively new roof surface. For ground-mounted solar project candidates, a minimum of ~2 acres of usable land is recommended. In all cases, the project sites must be located in PSE&G territory in New Jersey.
For New Jersey businesses interested in exploring the financial feasibility of “going solar”, PSE&G’s Solar Loan Program provides a uniquely attractive source of project financing that offers a predictable and highly visible cash flow stream through a fixed-price SREC financing contract.Contact Us Today!