PSE&G Solar Loan III Program General Q&A

Transcription

1 PSE&G Solar Loan III Program General Q&A Note: The following are common questions that PSE&G has received regarding the Solar Loan III Program. This document is for informational purposes only. See your loan agreement for further details. Q1: What is the PSE&G Solar Loan III Program? A1: PSE&G has committed to providing financing for 97.5 MW (dc) of solar system installations in our electric service territory over the next three years. The program will provide loans to customers in the following program segments: Residential Individual Small Non-Residential ( 150 kw) Large Non-Residential (151 kw 2000 kw) Residential Aggregated Landfill or Brownfield ( 5,000 kw) Q2: What are the terms of the loan? A2: The loan has a 10 year term with an interest rate of %. The same interest rate applies for all program segments. Q3: Does the 10 year loan term mean borrowers have free and clear title to all SRECs in the event the loan is repaid early? Is there a call option similar to the first two PSE&G Solar Loan Programs? A3: In the event your system performs better than expected and you pay off your loan before the 10 year term, PSE&G will relinquish control of the PJM-GATS account and you will be permitted to sell all SRECs generated in the market. There is no call option in the Solar Loan III Program. Q4: How much capacity is available in each program segment? A4: The expected program capacity is provided within the following table. Capacity available in each solicitation is subject to market demand from prior solicitations. Solicitation Segment % of Total MW #1 #2 #3 #4 - #12 #13 - #18 Residential 10.00% TBD Residential -Aggregated 10.00% TBD Small Non-Residential ( 150kW) 13.48% TBD Large Non-Residential (> 150kW 2MW) 61.39% TBD Landfill-Brownfield 5.13% TBD Total TBD 1

2 Q5: Is it possible for program capacity to be transferred between segments? A5: Yes. During each solicitation, underutilized capacity from either the resaggregated, landfill or large non-residential segments may be reallocated to other oversubscribed segments for that same solicitation, except for the first solicitation where any unused capacity in the res-aggregated segment will be added to its segment s capacity in the second solicitation. Q6: My project is already under construction. May I participate in the Solar Loan III Program? A6: Projects under construction may not participate if they are in the residentialindividual, small and large non-residential program segments. In the residentialaggregated and landfill/brownfield segments, projects under construction, but not in commercial operation are eligible to apply for the Solar Loan III Program. Q7: How does the program define under construction? A7: Under construction means anything other than site clearing or site preparation. The receipt and storage of equipment at the facility site will not be considered under construction, provided no attempt is made to assemble or erect the equipment. Q8: How does the program define commercial operation? A8: Commercial operation means that the system is operating and has received its final inspection in preparation for the issuance of SRECs. Q9: What are the construction milestones? A9: PSE&G has established milestones based upon the program segment. Failure to meet these milestones may result in a fee deducted from the loan disbursement. Please see your individual project segment Q&A for details. Q10: Is there a limit on the amount of capacity any one entity can borrow? Do SLI & SLII capacity allocations have any bearing on a borrower? A10: There are no program capacity limitations for any one borrower. However, PSE&G will evaluate credit worthiness, in part, by our aggregate exposure to any one borrower. Q11: How do I register my solar project with the State of NJ? A11: Go to for instructions. All projects must be registered with the NJ Clean Energy Program in order to be eligible for the PSE&G Solar Loan Program. 2

3 Q12: How do I apply for a PSE&G Solar Loan? A12: You must apply online. Please go to the Apply Now box on the right hand side of the following webpage and follow the instructions. PSE&G will announce the schedule for each solicitation well in advance. Q13: What are the costs to participate in the Solar Loan Program? A13: There are three primary fees related to the Solar Loan Program: the application fee, the administration fee and the SREC processing fee. These are tailored for each program segment. There is also the possibility of missed milestone fees in the event a participant does not meet certain milestones during the project lifecycle. Please see your specific program segment Q&A for further details. Q14: What documentation will be required during the application process? A14: The required application materials will be similar to previous programs. The applicant must submit technical and credit related information through the PSE&G web portal once the solicitation opens. Q15: What technical information must be submitted? A15: A complete list of the technical information will be available on the PSE&G website, but at a minimum will include the following: 1.) Interconnection application 2.) Engineering design layout diagram 3.) Electrical one-line diagram 4.) PV Watts simulation and derate sheet 5.) Specifications and warranties for modules and inverters Q16: What credit information is required? A16: Please refer to your specific program segment Q & A and the credit requirements outlined on the following webpage: Q17: Please describe the PSE&G interconnection process? A17: The Solar Loan Program team will forward your interconnection application and technical information to our electric department where it will be reviewed. You need to contact our interconnection/meter department prior to commencing construction at (800) or them at cinetmeter@pseg.com 3

4 Q18: Will the PSE&G loan cover all of my solar project costs? A18: No, the PSE&G solar loan will only cover a portion of the project costs. The loan amount will be determined by the size of your system and its specifications, as well as the accepted floor price. PSE&G provides a loan calculator on its website to assist borrowers in determining the approximate loan amount. This is subject to the final specifications of the system once constructed and PSE&G review. Q19: Is this a loan or a rebate from PSE&G? A19: This is a loan and must be paid back to PSE&G either with accumulated SRECs from your solar system or with cash in the event that SRECs are not available. Q20: Does PSE&G provide construction financing? A20: No, this is not a construction loan. PSE&G funds the loan once construction has been completed and the applicant has undergone various inspections. Q21: How do I pay for the construction of the project if PSE&G doesn t provide financing at the outset? A21: You should discuss your project payment schedule with your solar installer to determine if they can provide any solutions. If not, there are companies willing to provide construction financing for both residential and commercial solar projects. Q22: When will I receive the loan disbursement? A22: PSE&G will be in a position to close your solar loan once all inspections have been completed, meters have been installed, legal due diligence has been received and a certification letter has been obtained from the NJ Clean Energy Program. Q23: How do I pay my loan back? A23: You can pay back your solar loan either with SRECs produced by your solar system or with cash. Q24: Will I ever have to directly pay PSE&G from my own funds? A24: The loan is designed so that it should be paid back entirely with SRECs over the 10 year term assuming the output of your solar systems meets expectations. However, there is a true-up clause that requires the borrower to make cash payments once a year if that is not the case. See a sample loan agreement for further details. Q25: What is a SREC? A25: A SREC is a Solar Renewable Energy Certificate. It is a clean energy certificate issued once a solar system has generated 1000 kwh (kilowatt hours) of energy. Q26: Will SRECs reduce my monthly PSE&G electric bill? A26: No. SRECs will not affect your monthly electric bill. 4

5 Q27: Do I register and trade my own SRECS? A27: No. Once your solar loan closes, PSE&G will set up your account with PJM- GATS and manage the SRECs on your behalf. Q28: Will the SREC floor price remain the same for the entire loan term? A28: Your floor price is guaranteed by PSE&G for the entire loan term or until your loan is paid in full. Your floor price is the higher of your winning SREC bid price or the market price as defined in the loan agreement. Q29: How will PSE&G monitor my SREC payments? A29: PSE&G will install a SREC meter at the project site. Each time your system generates 1,000 kwh of electricity, PSE&G will transfer one SREC from your account toward repayment of the loan. Your electric usage will be tracked by a separate net meter. Q30: Do I have access to the SREC account online? A30: No. At this time PJM-GATS only allows one entity access to the account. Q31: How is my monthly electric bill determined? A31: Your monthly electric bill is determined by the readings of the net meter installed at the project site prior to the closing of your loan. Once your system is constructed, you can contact the PSE&G Net Meter Billing team with any further questions at (609) Q32: How does net metering work? A32: Net meeting measures the difference between the electricity you buy from your utility and the electricity you produce with your solar system. Your net meter keeps track of this difference automatically. Under net metering, excess electricity produced by your solar electric system is delivered back into the utility grid, effectively spinning your meter backwards. Your meter spins forward when your solar system does not produce all of the electricity you are currently consuming. Q33: Who installs the meters and how do they know when to install them? A33: Please contact the PSE&G meter/interconnections department prior to installing any meters. They can be reached at (800) A PSE&G meter box must be installed and inspected before meters can be installed. PSE&G will schedule the inspection and install the meters upon receipt of the municipal the UCC Certificate of Approval, Part 2 or Attachment B of the Interconnection Agreement and the meter installation fee of $

6 Q34: What inspections are required to participate in the PSE&G Solar Loan Program? A34: 1.) Municipal Certificate of Approval (COA) provided to the PSE&G meter group 2.) Meter inspection prior to meter installation is conducted by PSE&G 3.) Field Inspection, ordered by PSE&G through a third party, to verify technical details and that the system is in proper working order Q35: Can I pay off my loan before the 10 year term? A35: Yes, you can pay the loan off early, but you will lose the guaranteed floor price at the time of loan payoff. Q36: Does PSE&G maintain the panels and solar system? A36: No. The borrower is responsible for maintaining the panels and solar system. PSE&G is the lender only. Q37: How does the bidding/solicitation process work? A37: Participants will submit an application along with a SREC bid floor price to PSE&G during an open solicitation period. PSE&G plans to conduct 4-6 solicitations per year. Your SREC floor bid price has a direct impact in determining the loan size you will receive. See the loan calculators PSE&G has provided on its website to determine the approximate loan amount you will receive, subject to PSE&G review and the final as-built specifications of the system as installed. Proposed SREC floor prices must be in multiples of $5.00 Within each program segment, qualified projects will be ranked from the lowest to the highest SREC floor price Applicants that bid the same SREC floor price within a segment will be further ranked according to a date and time stamp Each capacity block will be filled by the ranked list of qualified projects until the capacity is fully allocated As applicable, applicants will be notified after the close of the solicitation that their projects have been conditionally accepted subject to further review including credit and interconnection Applicants not accepted due to capacity limitations will be placed on a pending list until the next solicitation in the event any conditionally accepted projects are rejected or withdraw from the program. In the event no further capacity becomes available, the applicant will have the opportunity to re-apply in the subsequent solicitation. The applicant will also be able to revise their SREC floor price if they so choose. 6

7 Q38: How long is the solicitation window open? A38: The solicitation schedule will be posted to the PSE&G website in advance of each solicitation. Typically, the solicitation window will be open for approximately two weeks. Q39: Who will determine if my bid and application are accepted? A39: PSE&G will determine if your bid is accepted. However, all bids will be reviewed by an independent solicitation manager to confirm that they are competitive. Q40: Can I apply and bid at any time? A40: No, there are specific periods to bid that will be posted on the PSE&G website in advance of each solicitation. Q41: Do you accept an unlimited number of applications in the solicitation period? A41: Yes, however, there is a limited amount of capacity available for each solicitation period, which is divided between the different program segments. Q42: When will I know if my bid was accepted? A42: You will be notified by PSE&G after we have completed our initial review of your application and the independent solicitation manager has provided their guidance regarding the competiveness of your SREC floor bid price. Q43: What happens once my bid and application are accepted on a conditional basis? A43: Your loan application will undergo our formal credit review and interconnection review process. Q44: If a bidder is successful, what floor price do they obtain, the price they bid or the price the auction clears at? A44: The applicant will receive the higher of the floor price they bid or the market price as defined in the loan agreement. This is not a uniform price auction. Q45: Will winning bids/loans be assignable? A45: No, however PSE&G will consider requests to change the name of an applicant that is a special purpose company. PSE&G reserves the right to reject the request. If the request is accepted and an additional credit or legal review is required, there will be a $3/kW fee to cover the additional administrative cost of accommodating such change. Q46: Will there be any conditions on type of equipment or labor (e.g. prevailing wage) used in the underlying project? A46: No. 7

8 Q47: What happens when construction is completed? A47: Upon construction completion, you should contact either or The completed final as-built package must be submitted to NJ Clean Energy program with a copy to PSE&G. Further information can be found at Q48: Who should I contact if there is a possibility that my commitment letter from PSE&G may expire prior to closing the loan? A48: You can request an extension by ing PSE&G at lisa.robinson@pseg.com. PSE&G will have final authority on whether any particular extension will be granted. Q49: What happens if the system stops operating at any given time? A49: You should make immediate arrangements to have your solar system repaired and inform PSE&G of any issue that may materially impact the production of the system. You may need to provide cash payment per the conditions in your loan agreement. Q50: Will closing funds always go directly to the borrower? A50: Prior to paying the borrower, PSE&G requires an unconditional lien waiver release from the contractor showing that they have been paid in full. An alternative option is for PSE&G to pay the contractor directly. The contractor and borrower will provide a signed Assignment of Funds letter to PSE&G. Q51: Does PSE&G place a lien on my property? A51: PSE&G will maintain a first priority lien position on the solar equipment only and will file the lien against your solar system once the loan closes. Q52: How is the final loan amount calculated? A52: The final loan amount is calculated based on the final size and technical details of your solar system. This technical information is verified by the field inspector in advance of the loan closing. The estimated value of the SRECs produced over the ten year loan term will dictate the final loan amount. See the loan calculator PSE&G has provided on its website for an approximation of this amount. Q53: Do I need legal representation for the closing? A53: Legal representation is not required, but may be in your best interest. PSE&G recommends that you have legal representation. Q54: What happens after the loan closes? A54: PSE&G will set up your SREC account with PJM-GATS and administer the account. You will receive quarterly loan statements from PSE&G beginning four months after the date of your loan closing. 8