The Pennsylvania solar power market is seeing an increase in both utility and local scale solar power development. A change in law supporting in-state created and sold solar renewable energy certificates (SREC), as well as the bubble of potential political shifts is driving this.
Last week, Glidepath Ventures and Grasshopper Solar announced that they’d transacted on a 278 MW (~1,100 acres), 12-project portfolio. The transaction price was announced at $300 million – $1.08/W.
Glidepath originated the portfolio between 2017-2019, and will continue development, interconnection and permitting. The group anticipates commercial operation dates of 2020, 2021, and 2022. Glidepath noted they’d developed another four projects in Pennsylvania, totaling 887 MW, and placed those with an independent power producer – totaling 1,165 MW of solar capacity.
Grasshopper Solar will be the long-term owner-operator. The Canadian developer will lead project financing – which will include equity, tax equity, and debt partners. They’ll also manage construction and sales of the electricity.These projects will participate in the PJM Interconnection market.
The projects were stated to be selling into the PJM Interconnection market. The sale of the electricity will compete with other wholesale electricity providers. That the projects are sited in Pennsylvania, means they’re eligible for SRECs. Per SRECTrade, a single Pennsylvania SREC last sold at 3.9¢/kWh.
There is also the possibility that the projects can sell into the capacity markets, earning an income in exchange for guaranteeing uptime of a certain amount. This has been happening with solar power as the DC t0 AC ratios have increased, however, due to recent federal intervention in local power markets it is expected that pricing challenges will arise.
Smaller Scale (30 acres and less) Opportunities
Development activity for smaller scale projects that will potentially connect to local power companies – not PJM – is also increasing. This development activity is perking up because community solar legislation was introduced in the state’s legislature. While this legislation hasn’t moved forward yet, we are in an election year – so there is much anticipation that it might. However, even if it is signed and sealed before the end of the year – it will still take time for the program to move from the governor’s desk to being ready for solar developers to submit applications.
A currently existing program – virtual net metering to customers within 2 miles – already exists. This allows projects as large as 5 MWac (30 acres) under certain conditions. Commercial Solar Guy is developing a project of this type. We’ve received local zoning approval and are now working through conservation and interconnection.
SEIA notes 475 MW of solar power installed in the state, and projects 925 MW more over the next five years.
