POWER November 2021 - 35

PROJECT FINANCING
sential to know the timing of which documents
are up to date and when they
must be refreshed.
2. Most projects require a staggering
amount of documentation to satisfy investors.
Standardizing the process is often worthwhile.
Source: Shutterstock
lays and project disruptions. If you're able
to better serve your own customers by
combining strengths through the relationship,
you'll be able to achieve growth while
helping to drive the industry forward.
Standardizing Documents Is Time
Well Spent
The amount of documentation involved
in a solar project can be staggering
(Figure 2). Different project contracts,
power purchase agreements (PPAs), piloting
agreements, and more must be
accurate and recent for a financing partner
to ascertain value and make a sound
assessment of their investment. It's esWhen
it comes to paperwork related
to site control, such as easements, and
interconnection permissions and agreements,
a deep understanding of project
details is necessary. The same can be
said of the expertise required for environmental
documents, like a Phase 1
Environmental Site Assessment (ESA),
enabling compliance.
Banks, lenders, and potential partners
who are large solar developers
with strong financial backing will be
most interested in conducting efficient
transactions, so every
opportunity
should be made to bundle high-quality
projects together, and reduce legal diligence
and financing transaction costs.
By focusing on the right partners and efficient
documentation, small developers
can get the financing they need to start
building their own portfolios and keep
their customers happy while potentially
developing repeat business.
If a company develops five different
sites, it should avoid providing five different
leases to a financing counterparty.
The actual contract, and all the terms and
conditions, will generally be the same,
so providing a more standard set of documents
will create value in the eyes of a
financial partner, particularly those who
can demonstrate potential for scale by
saving time and therefore money.
Like any good partnership, commitment
is required. That means it's
important to invest the time and resources
upfront to find and integrate
the right partner and properly standardize
documents. In the end this extra
lift will pay off handsomely in the
form of accelerated project timelines
and higher quality transactions.
The best part about this approach for
small developers is the built-in growth
trajectory. Over time and with success,
they begin to develop their own ecosystems
that feed off their partners,
streamlined processes, and completed
projects, delivering value and bringing
even more solar installations to fruition
for their customers. ■
-Jamie Hutson is the Chief Investment
Officer at Distributed Solar Development
(DSD). He has more than a decade of
experience in renewable energy financing
and has raised several key financing
packages during his time at DSD and GE.
November 2021 | POWER
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POWER November 2021

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