Availability Funding and Grant Amounts
The FY18 Community Solar
Guaranty Grant Program has been allocated up to $1,000,000, subject to funding
availability, from the Strategic Energy Investment Fund (“SEIF”). One or more
grants, totaling up to $1,000,000 will be chosen on a competitive basis. As specified below, each applicant should specify
the grant funding amount requested, and the basis for requesting this amount. The grant fund amount will be available for
reimbursement during the first three years of the project. Grant
funds are solely to absorb the additional risk associated with the LMI subscriptions.
Background
The Maryland Community
Solar Pilot Program commenced in April 2017. Community solar is a form of
virtual net energy metering where the consumer gets energy credit on a local
bill for energy produced off-site (but within the same electric utility service
area). The Maryland Public Service
Commission has authorized certain subscriber organizations to participate in
the pilot program. This programs allows
Maryland residents and businesses to purchase subscriptions for energy from
community solar arrays, gaining the same economic advantages as having solar
modules directly on their roofs.
In support of this
program, the Maryland Energy Administration developed the Community Solar
Guaranty Program in order to assist Subscriber Organizations developing community
solar arrays under the Low-and-Moderate Income (LMI) category, mitigate the
perceived financial risks associated with working with this community. Risk mitigation may be reflected in one or
more of the following: greater
availability of investment funding, lower interest rates available to the
project developers, and a greater population of eligible LMI subscribers. The incentives in this grant program may only
be used to support the LMI subscriber portion of the solar array.
It is assumed that most
LMI subscriptions will use the PPA model (little/no up-front money, pay for
electricity used from the solar array on a $/kWh basis). As such, the Subscriber Organizations depend
on prompt and proper energy payments from the subscribers in order to make monthly
payments to the financiers. As some in
the LMI community may have lower or no credit scores, financiers may assign
financial risk to the cash flow and raise the interest charged to the project
developers (the subscriber organization) to compensate for the added financial
risk. This raises the total cost of the
project and therefore raises the PPA rate that must be charged to the
customers. Similarly, subscriber
organizations may require subscribers to have higher credit scores in order to
minimize their financial risk. This
reduces the size of the LMI community who will be eligible to subscribe.
Project Requirements
Participating Funds or
programs must meet the requirements of the Notice of Grant Availability. Some of the key elements are provided below:
o State
funding must be available to support projects from across the state.
o The
fund must be authorized to conduct business in Maryland.
o State
funds may only be used to provide support for late or missing payments from the
LMI subscribers.
o State
funding will be available for three years.
o Supported
projects must be part of the Community Solar Pilot Program; Subscriber
Organizations must have a subscriber number issued by the Maryland Public
Service Commission.
o Supported
projects must have been allotted capacity under the LMI category of the
Maryland Community Solar Pilot Program, or be in the “Other” category and
provide more than 51% of its energy credits to members certified as LMI.
o Supported
projects must meet requirements of the Maryland Historic Trust.
Eligibility Requirements
In order to qualify for
consideration under FY18 Community Solar Guaranty Program, applicants must meet
the following requirements and propose projects that meet the following
requirements:
o The
Applicant must be authorized to conduct business in Maryland.
o
The proposed project must only be available to
PSC Approved Subscriber Organizations to support a community solar project
allotted capacity under the LMI category, or in the “Other” category which will
provide more than 51% of its energy credits to members certified as LMI.
o
The proposed project must be available to
support community solar projects regardless of geographic location in the
State.
o
The proposed project may only be used to reduce
risks associated with late or nonpayment by LMI subscribers.
Application Process
Applications are due by
11:59 PM EDT, May 14, 2018.
Applications should be
submitted electronically (if possible).
Any material considered personally sensitive (i.e. social security number)
should be sent by US mail to arrive by the application due date.
o Name,
physical address and website (if available) of applying organization.
o Point
of Contact’s name, address, phone number, and e-mail address.
o Name
of individual authorized to legally bind the applicant.
o Verification
that the applicant is authorized to conduct business in Maryland and is in good
standing.
o Amount
of funding requested ($) and reason for requesting that amount.
o Explanation
of how the State funds will be used to mitigate the non-payment risk
o A
summary of the purpose and history of the fund.
o Examples
of a) the Applicant’s experience with providing similar credit enhancements in
the past, or b) experience of the Applicant’s directors and/or key personnel
with providing similar credit enhancements.
o Applicant’s
Bylaws (or equivalent) (to be included as an Appendix to the Application)
o Short
biographical information and experience of key personnel (to be included as an
Appendix to the Application).
o A
description of a proposed project which includes:
o
A description of the credit enhancement the
Applicant will provide, (i.e. explanation of how the State funds will be used
to mitigate the non-payment risk)
o
An explanation of how the Applicant will assure
that community solar projects from all participating utility service areas in
Maryland will be considered for funding on an equal and fair basis.
o
A description of how the Applicant will sustain
the guaranty fund for a sufficient amount of time to provide the selected
subscribing organization’s access to favorable financing rates.
o
Description of recommended metrics to measure
the effectiveness of the grant funding to a) increase the savings to the LMI
subscribers, and/or b) to increase the number of LMI subscribers eligible to
subscribe to a project.
o
Description of the process the Applicant will
use to assure grant funding will be used solely to absorb the risk associated
with late/non-payment by LMI subscribers.
Each grant application is
limited to 15 pages. This page limit
does not include appendices consisting of resumes/bios of key participants and
Bylaws. Electronic proposals are
preferred. Send applications to: David.Comis@maryland.gov
.
FY 18 funding is expected
to support projects authorized during the first year of the Community Solar
Pilot Program. There is no guarantee of new
funding in FY 19 and FY 20.
Evaluation Criteria for Competitive Award
The Maryland Energy Administration reserves the right to
choose one or more applications based on availability of funding, quality of
applications, and evolving needs of the Community Solar Pilot Program. Evaluation criteria include the following:
o
Leveraging of state funding: 30%
o
Directors (and decision maker) experience
working with Guaranty Funds: 30%
o
Procedures proposed/taken to ensure state
funding is only used to make up for late/non- payment from LMI subscribers: 30%
o
Procedures to ensure the fund sustains the
projects long enough to achieve favorable financing: 10%
At MEA’s sole discretion,
multiple awards may be used to demonstrate different types of credit
enhancement.
Timeline
- Notice of Grant Availability Posted – April 18, 2018
- Grant Application Deadline – May 14, 2018
- Grant Decision Announced – June 1, 2018
- Grant execution (signatures required to be returned to MEA) –
June 15, 2018
- MEA reimburses grantee on a quarterly basis (or less
frequently as agreed upon) upon acceptance of a completed invoice/payment
request and quarterly report using the MEA template,
Reporting Template.docx
- Final Report due to MEA – 3 years and 3 months from the date
the last guaranteed project produces creditable power.
Additional Information
Historic Review
Grant funds may not be used to support a Community Solar Pilot
Program project that is found to adversely affect historic buildings or
historic districts by the Maryland Historical Trust. Grantees will verify that a Maryland
Historical Trust review has been successfully conducted for the solar array
site (and will pass the results to MEA), or will submit site information to MEA
to ensure review by the Maryland Historical Trust. A successful review must be received before
grant funding may be used to support a project.
NABCEP
Grant funds may not be used to support a Community Solar Pilot
Program project that does not have at least one person certified as a Solar PV
Installer by the North American Board of
Certified Energy Practitioners ('NABCEP') involved in the design
and/or installation of the community solar array. Grantees will be required to provide the name
and certification number of these individuals.
Solar Renewable Energy Credits (SRECs)
Grant funds may not be used to support a Community Solar project
that is not registered for and produce Solar Renewable Energy Certificates
(SRECs). Grantees will be required to
verify the successful registration of projects with the Maryland Public Service
Commission and with PJM Interconnection.
Tax Status of Community Solar Grants
The Community Solar Guaranty Grant
Program is operating under the Strategic Energy Investment Fund which affects
how clean energy technologies are taxed. Grants issued by the State of Maryland may be
taxable. As the Maryland Energy Administration is unable to give tax
advice, any tax-related questions should be directed toward a qualified tax
professional.
Contact
For more questions,
additional information or assistance, please contact David Comis.
