Commercial Solar Lease Explained

Commercial Solar Lease Explained provides a detailed explanation on alternative financing for smaller commercial solar projects sized 10kW to 1MW.


Solar Tax Lease

In September, Helio Micro Utility (Helio mU) launched our new Commercial Solar Lease, a much-needed financing tool for smaller, hard-to-finance commercial projects (from 10kW to 750kW or more).  Since then, we’ve been receiving a lot of traffic and requests for the lease, providing many free pricing quotes and enabling your bottleneck of projects to flow more freely.  A common cause of the bottleneck is that many business owners simply don’t have a tax bill from Uncle Sam every year that’s sizeable enough to swallow the entire Federal Investment Tax Credit (ITC).  This type of business owner typically either has to ‘strand’ a portion of the ITC, essentially wasting it, or carry it forward to offset tax bills in later years, which can be highly uncertain.

Helio mU has addressed this issue by partnering with a third-party financier who is able to take ownership of the solar array at first, utilize the ITC, and lease the system to the business-owner for 5 to 7 years at which point they buy the system at a substantially-reduced price (15%-20% of original price).  The financier essentially ‘shares’ the ITC with the business-owner; as a result, the Commercial Solar Lease has a lower lease payment, compared to any other type of lease.  Additionally, the business-owner can then depreciate the system cost upon purchase at the end of the lease term, reducing their tax liability.  This is truly a ‘win-win’ situation!

As distributed generation proliferates with the help of our Commercial Solar Lease, we believe Energy Storage will soon follow.  Although financing storage currently faces a few hurdles and challenges, Helio mU will be on the forefront of this market as it evolves, planning to offer a solar+storage financing solution in the near future!  In the meantime, please contact me for more information about our Commercial Solar Lease, and let Helio mU help you get your projects flowing through the pipeline!

For more information, contact Tom Selden, Director of Project Finance