Huge BofA Project to Install $2.6bn of Solar on Company Roofs Across U.S.
Bank of America Merrill Lynch, Prologis and NRG have unveiled a ground-breaking partnership designed to finance up to $2.6 billion of commercial and industrial rooftop solar arrays, giving a huge boost to the amount of grid-connect solar online in the U.S. today.
Once finalized the agreement will be the largest distributed solar deal in history, the partners said. They said they have been offered a conditional commitment for $1.4 billion of debt facilities from the U.S. Department of Energy’s Loan Programs Office for the project, which aims to install 733 MW of power and create the equivalent of more than 10,000 full-year jobs across 28 states.
At the end of 2009 the U.S. had about 1,250 MW of photovoltaic solar power connected to the grid, according to the Interstate Renewable Energy Council.
Bank of America was the sole financial lender in the agreement under the Department of Energy’s Financial Institutions Partnership Program. Through this program, the DOE is guaranteeing 80 percent of the $1.4 billion debt financing. Prologis, an owner, operator and developer of industrial real estate, will provide site access to rooftops and will act as developer, construction manager and program sponsor, in addition to making an equity investment.
NRG Energy will be the lead investor for the first phase of the project and has a right of first offer for the remainder. It will also provide development resources and project expertise for the installations.
The total of $2.6 billion will be financed entirely by the private sector over the next four years, the partners said. The three firms are now working to finalize the financing documentation for the project and begin the first phase of installation. Out of this phase, 15 MW of solar capacity is ready for immediate construction and installation in Southern California, where the power will be sold to a local utility under an already-executed power purchase agreement.
The deal deal is part of Bank of America’s 10-year, $20 billion Environmental Business Initiative, launched in 2007, and adds to a growing list of recent commitments including a newly established goal by the company to reduce its global green house gas emissions 15 percent by 2015, and the launch of a $55 million energy efficiency finance program.
“As one of the world’s largest owners of distribution facilities and an active solar industry participant, we’re pleased to be a partner in a project of this magnitude,” said Drew Torbin, vice president of Prologis Renewable Energy. “This project will add significant scale to the distributed solar market and provides economic and environmental benefit to our shareholders and customers.”
“NRG believes rooftop solar is a smart choice for industrial, commercial and residential property owners in markets around the country, and this program provides the commercial scale that will bring the benefits of solar power to customers across the country,” said Tom Doyle, president of NRG Solar, NRG’s solar subsidiary.
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