Building a Solar Paradise
A new $100 million financing program for small businesses and non-profits in Hawaii helps address climate change, and save money
Panasonic and its partner Coronal Group LLC are collaborating with Clean Power Finance and the State of Hawaii to finance up to $100 million of solar photovoltaic systems. This public-private partnership is part of Hawaii’s Green Energy Market Securitization Program, or GEMS, a sustainable financing initiative of the Hawaii State Energy Office to make clean energy more affordable for and accessible to businesses and nonprofit organizations focused on underserved communities.
GEMS is the first program in the United States to use rate reduction bonds, which are commonly used by utilities, to finance solar energy. The ability to tap a huge pool of municipal bond capital reduces financing costs for clean energy installations by minimizing overhead expenses and maximizing economies of scale.
Panasonic and Coronal will initially provide tax equity and engineering, procurement and construction services to installers in Hawaii who will originate the solar energy projects. Clean Power Finance will work with the state of Hawaii to manage capital deployment and provide underwriting and origination services to the state and the Coronal-Panasonic team.
Small business is critical to the Hawaiian economy. Hawaii’s small businesses employ more than half, or 258,345, of the state’s private workforce, according to the U.S. Small Business Administration.
Hawaii relies more on oil for electricity needs than any other U.S. state. Hawaii counted oil for 71% of its electricity production in 2012, according to the latest figures available. And due to its remote location, Hawaiians pay more for fossil fuels than residents and small business owners elsewhere in the U.S.
Hawaii is also seeing unprecedented growth in solar generation. Solar energy in 2013 provided 23 percent of Hawaii’s renewable energy generation, according to state data. Hawaii ranks among the top ten states in terms of megawatts of solar photovoltaics installed, according to the U.S. Solar Market Insight 2014 Year in Review Report, published by GTM Research and Solar Energy Industries Association.