Solar Finance
Solar Financing Investment Tax Credit and Accelerated Depreciation Cash Rebates Renewable Energy Credits (RECs) Energy Savings Performance Contracting (ESPC) Power Purchase Agreements (PPAs)
ESPC, or simply, performance contracting, is a way to eliminate out-of-pocket expenditures for solar energy while saving on electricity bills immediately. Under a performance contract, Greenskies installs the renewable energy equipment and provides the client with the option for long-term monitoring and maintenance. Greenskies will also help the client determine the best situation for a loan on the equipment. By projecting the values of electricity generated, Greenskies connects the client to a bank or financial institution that will allow the client to take a loan for the installation and accept a payment smaller than the electricity savings for repayment.
After approval from the bank and the disbursement of the cash, the client services the bank note with the savings generated from the solar installation. The client can opt to dedicate all of the savings towards the bank note in which case the client makes payments as usual, but instead of paying an electric bill, the client pays a bank loan until the system has been paid for. At the end of the ESPC, the customer receives all of the savings, enjoying reduced energy costs for the remaining life of the equipment.
The client can also choose to build in immediate savings into the finance structure. By doing so, the duration of the loan extends farther into the future, but the client goes solar with no money out of pocket and gets lower electric bills immediately. The customer's share of savings can flow into operating cost reductions or be used to fund additional energy efficiency improvements.