What distributed generation technology does GEM Energy offer?
GEM Energy is a turnkey solar developer from deal structure through design, installation and maintenance. Our current solar installations generate 15 MW hours and in-development projects will add 10 MW dc. We are developers in a number of northeastern states including New York, Maine, Maryland, New Jersey, Connecticut, Massachusetts, Washington DC, Delaware, New Hampshire, North Carolina and Georgia.
COMBINED HEAT & POWER (CHP)
We are also a full-service Capstone MicroTurbine distributor for the states of New York, Ohio, Michigan and Indiana, providing engineering, start-up, commissioning and factory protection plan service. GEM Energy has over 50 advanced power system installations including two 1-MW systems.
How long does it usually take to complete a distribution generation project from financing through installation?
For solar, this process can be completed in as little as four months. Construction is very quick with the average 1.0 MW size array installed and operating in three months or less.
From commencement of the financing process to installation, CHP projects varies by the complexity of the system but typically takes anywhere from one to four months.
What can GEM Energy do to help my business get a solar or CHP project approved for financing?
GEM Energy offers distributed generation financing products that allow projects to be deployed with little or no capital structuring everything from leases to PPAs – Power Purchase Agreements.
We can monetize the tax benefits and help you take advantage of the equipment depreciation. Our finance products allow for no capital expense by the owner or host allowing customers to focus on their core business and still take advantage of the benefits of on-site distributed generation.
This process encompasses incentives, tax structure and special purpose vehicles — SPVs.
What is an SPV?
An SPV, or LLC, is a method of off-balance sheet financing for the host or customer. If your company doesn’t want the debt on its balance sheet, we structure it so that the debt resides in an LLC. This takes the commitment off of the current balance sheet of your business.
This is key for the public, not-for-profit sector. Since non-tax paying entities cannot take advantage of a tax credit, the SPV allows us to structure this tax credit in the economics and essentially give it back to the customer or host through lower energy rates or lease payments. For solar the tax credit is 30% of the value of the asset. For CHP it is 10%.
What if my business already has a long-term relationship with a bank? Could we take a distributed generation project to our own bank?
Typically commercial banks specialize in certain markets. Your bank may be capable of financing a solar or CHP project, but it’s most cost effective to work with a bank that specializes in these technologies. GEM Energy’s banking partners have expertise in energy projects.
My organization is in the non-profit sector. How can you help us finance a distributed generation project?
For non-profits, a PPA allows us to capture tax benefits for non-tax paying entities that you would otherwise not be possible. Hospitals, universities and secondary schools are eligible for Investment Tax Credits. ITCs are currently 10% on CHP installations and 30% for Solar. In 2016 the credit for solar will drop from 30% to 10%.
You can learn more about ITCs on our Economics of Solar page.
What does the financing process involve and how long does it take?
From start to finish, we make the process as painless as possible for you by managing the details. We arrange the debt and tax equity financing on all of our projects.
With many of our capital or tax lease structures, the process is very simple with reduced transaction costs and fast turnaround. Our lease structures allow you to use your own money for your core business while crafting the structure in a way that lowers operating costs with a long-term view of your business energy expenses. This includes locking in current utility pricing against future increases.
For example, we have installed a solar array for a government facility. The customer knows exactly how much they will be paying annually for the next 10 years from electricity generated by the panels. We can even give them line-of-sight 25 years out.
In most cases for solar and CHP financing, we can respond on project viability from an economic standpoint within 24 hours.