Solar advocates make appeal to businesses that now is a uniquely good time to look to the skies
February 15, 2021
The Pennsylvania Solar Center, a Hill District nonprofit whose mission is to grow the amount of solar energy generated in the state, is paying special attention to small- and medium-sized businesses this winter.
Started by Sharon Pillar in 2018, the center helps organizations sort through the process of going solar — if it’s physically feasible, how to find a solar installer, how to navigate permits, incentives and financing.
So far, its efforts have focused on nonprofit organizations. But the latest offer of technical and financial guidance is all about the commercial space.
“We think that businesses are a little bit of an untapped market,” said Ms. Pillar, the executive director.
Many haven’t explored going solar and may be reluctant to think about discretionary spending when so many companies are just trying to stay afloat these days. But, Ms. Pillar argues, several incentives and programs can be layered on top of one another to make the goal more achievable now than when the world wasn’t yet upside-down.
First is a federal investment tax credit that allows solar owners to deduct 26% of their solar development costs from their tax bills. The incentive was scheduled to expire at the end this year but was extended for another two years in December.
There’s accelerated depreciation, which is available to businesses but not to nonprofits.
Another option is a new program launched in Allegheny County in December that allows businesses to finance their energy-saving projects through a voluntary assessment on the property. A property owner gets a loan for building improvements that conserve energy — ranging from solar panels to low-flow toilets — and the loan is repaid through the annual real estate tax bill over the life of the project. For solar installations, that could be up to 25 years.
A C-PACE loan is attached to the property, not the borrower, so “it’s off the balance sheet,” Ms. Pillar stressed.
C-PACE is relatively new to Pennsylvania and is only an option in certain counties. No one from Allegheny County has submitted an application since the program opened here, said John Costlow, president of the nonprofit Sustainable Energy Fund, which administers the program. But he cautioned that such projects typically take a long time to put together.
For rural businesses, the United States Department of Agriculture gives grants and loans of up to 75% of a project’s costs.
So far, Mr. Pillar said last week, half a dozen businesses have expressed interest, and she expects more to surface closer to the deadline, which is March 1.
The Pennsylvania Solar Center has helped three cohorts of solar-curious organizations so far. Of those, two projects have successfully proceeded to development: a 63.2 kilowatt system at Global Links in Green Tree last year and the recently announced plan at Community College of Allegheny County for a 540-kilowatt array on its North Campus in McCandless. Another dozen or so projects are in the works, which means they are either still evaluating the technical requirements or trying to find financing. All are nonprofits.
Ms. Pillar said there’s no good way to track how many for-profit businesses have installed solar. While data from the Pennsylvania Public Utility Commission shows there are close to 20,000 solar installations in the state, the vast majority are likely small residential projects. Ms. Pillar’s organization is now trying to map known commercial installations — it has about 500 on the list.
In a sparsely attended webinar intended to introduce businesses to the Pennsylvania Solar Center’s current call for proposals last week, program manager Leo Kowalski encouraged businesses interested in solar to start preparing projects now so they can be ready to respond to whatever federal or state incentives lie ahead. Expectations are high for the Biden administration to push through infrastructure funding that advantages jobs created in clean energy and energy efficiency.
There is also hope that Pennsylvania will increase the proportion of electricity that utilities are required to get from solar power. The current standard, set by legislation, is a mere half a percent. The Wolf administration wants to increase that to 10% by 2030.
“If you’re moving down the road with a solar project and there are opportunities later this year or next year, it will be a huge advantage” to have something in the works, Mr. Kowalski said.