SolMicroGrid launches program to buy existing solar power systems

Solar power leasing models are a tale as old as time: Companies install panels on a customer’s property, but the installer owns the system, which the customer pays them for. But solar and microgrid company SolMicroGrid has created a program that turns the traditional playbook on its head.

• Through its new “energy-as-a-service” structure, SolMicroGrid is setting out to purchase existing solar arrays and microgrid systems from commercial and industrial owners and sell the energy generated back to them.
• CEO Kirk Edelman told Tech Brew that the program offers owners of solar infrastructure a way to benefit from low cost energy, while letting go of the responsibility of system upkeep.

“[Customers] may not be paying enough attention to [their solar panels], and maybe they’re not operating as well today as they did when they were first installed. Maybe you’re not seeing the same output,” Edelman said. “We can come in and write a check and buy your grid or your array from you, and then we can either fix it and maintain it and try to get it back to what you originally thought you bought, or we can enhance it.”

Edelman also told Tech Brew that SolMicroGrid can buy systems from building developers.

Born identity: The program was born out of an issue that Edelman said he witnessed in the solar industry that went unsolved. Many companies don’t want to take on the “asymmetrical risk” of securing the capital expense to own and operate a large portfolio of solar infrastructure.

SolMicroGrid can take on that risk because it’s a Morgan Stanley portfolio company, but there’s a tradeoff.

“I need to recover my capital, recover my operating expenses, and get a return,” Edelman said of the energy-as-a-service structure. “So you do have to sign up for an extended period of time, and that’s something we put out there right up front so that there’s no misunderstanding.”

Ideal customers for the arrangement, Edelman said, are owners of multiple solar arrays and systems that SolMicroGrid can buy and use to enter into a power purchase agreement with the previous owner.

“When you have capital like we have, it pays for us to have as many operating projects as possible,” Edelman told Tech Brew.