Becoming a green business can be a very complicated initiative. The most common ways of going green include, but are not limited to, purchasing RECs, bundling a percentage of renewables into your current supply, installing onsite renewable systems, or financing an off-site renewable system. Atlas Retail Energy will walk you through what options best fit your business goals. Furthermore, many advisors or consultants will partner with a single renewable company, while we review multiple providers for your specific project.
Between taking advantage of federal, state, county, and utility incentives, financing these initiatives can be just as complex as selecting what path your company takes. There are a few common ways financing can be accomplished, including physical PPAs, financial/virtual PPAs, upfront payments, on bill financing, and net metering. Atlas Retail Energy provides details about all possibilities of financing options and what best suits your business objectives.
A renewable energy credit (REC) is the renewable attribute tagged to each megawatt-hour (1 MWh, or 1000 kilowatt-hours) of renewable electricity generated.
RECs allow consumers to claim ownership of renewable power generation. Consumers purchase RECs to state that they have funded a specific amount of renewable energy generation to offset their fossil fuel power consumption.
Instead of financing or purchasing renewables, businesses have the option to request that their standard supply contract include X% of renewable generation. This is by far the least amount of risk and effort to become more sustainable.
Installing a generation unit or system on your businesses property with the goal to create or generate enough energy to offset all or a portion of the buildings energy usage. On site renewable generation units or systems are most commonly solar systems and/or wind turbines.
Funded by consumers, these systems are designed to allow users to only pay for the renewable energy generated along with the associated Renewable Energy Credits (RECs). The developer or builder of the renewable energy project owns, maintains and operates all the equipment and sells the energy to their users or back into the market.
Systems can also be partially funded partly instead of taking on the full commitment of funding a large off-site system. Certain programs allow you to only finance a portion of the project and receive a portion of the renewable energy generated and RECs.
- State Specific Community Aggregations
- Developer Aggregations
Consumers have the option to either own or lease the renewable system. Both can have their respective advantages, but generally leasing the system has less headaches and can be more economical.
- Physical PPAs deliver actual electrons to your specified delivery point in exchange for a pre-determined price per unit ($/kWh).
- A financial PPA contract is a contract for difference, or the delta between to prices is either paid or received.
- The developer builds, maintains and operates the renewable energy project at an offsite location. Then you agree to pay the developer a fixed price per unit ($/kWh), but instead of delivering the physical electrons to your site, the developer sells the energy back into the market and the contract for differences is initiated.
- You will always pay the same fixed price per unit to the developer, but when the developer sells the energy back to the market at a higher price than what you are paying them, you will receive those profits or difference between market price and PPA fixed price per unit. If the developer sells the energy back to the market at a lower price than the pre-determined ($/kWh), you must pay the developer to cover the losses or difference between market price and PPA fixed price per unit.
On bill financing
- Select a third-party supplier of energy and they will supply your energy for 5-10 years. The renewable project will be paid for through a $/kWh per unit charge embedded into your supply price.
- Net metering allows us to offer incentives that provide delivery and transmission rebates for using green energy. In some rare cases utility delivery charges can go negative.
- The standard solar tax incentive is 30% from the federal government. Furthermore, each state and utility may have their own incentive programs that help with financing periods. Generally moving the payback time from 15+ years to 3-10 years depending on the program.