Rhode Island Rooftop Solar Lease Rates – Q&A

Rhode Island Rooftop Solar Lease:

Incentives in Rhode Island are prompting business owners to explore the benefits of solar power, particularly rooftop solar. The simplicity and profitability of rooftop solar lease agreements in Rhode Island turn unused roof space into a consistent source of income. At CommercialSolarGuy, we ensure that the sun’s energy translates into tangible business returns.

While most of CommercialSolarGuy’s solar projects are sold to customers who own their own buildings, in many cases we compensate customers with cash payments in exchange for a lease on their rooftop for solar power installations.

Understanding Solar Incentives in Rhode Island

The concept of a company not only paying to install and maintain a solar array on your business’s roof but also providing a monthly revenue check might seem surprising at first. However, a closer look at the solar incentives available in Rhode Island reveals how these benefits become feasible and offer mutual benefits for solar developers and business owners.

The Rhode Island Renewable Energy Growth Plan provides financial rewards for solar power systems that contribute to the grid, benefiting surrounding properties. Payment rates vary by project size, with Rhode Island Energy offering between 14.35 and 25.65 cents per kilowatt-hour over a twenty-year period. These conditions make the deal particularly attractive for solar developers like CommercialSolarGuy, ensuring a profitable long-term investment backed by a contract with the power company and the state of Rhode Island.

Frequently Asked Questions:

Q. How much revenue will my roof generate under a solar lease in Rhode Island?

A. Income from a Rhode Island rooftop solar lease largely depends on the roof size and installation costs. We typically pay business owners about 20% of the annual electricity revenue. Estimated annual lease rates are based on usable roof space & power generation:

• 50k sq ft ≈ 250k watts: Generates $62,500 in energy sales annually or a $12,500 rent.
• 100k sq ft / 500k watts: Generates $129,000 in energy sales annually or a $25,800 rent.
• 200k sq ft / 1M watts: Generates $216,000 in energy sales annually or a $43,200 rent.

Q. Who maintains the solar power system?

A. CommercialSolarGuy commits to a twenty-year operations and maintenance program, ensuring smooth operation without any hassle.

Q. What about my roof warranty?

A. CommercialSolarGuy will coordinate with your roofer to ensure commercial solar installations comply with warranty standards.

Q. How long will the roof lease last?

A. By default, twenty years, with options for three five-year extensions. The system will remain operational well beyond this period.

Q. At the end of the contract, who manages the solar power hardware?

A. CommercialSolarGuy removes the equipment and handles hardware recycling.

Q. What if I want to own the system and secure the 20-year contract myself?

A. We manage installation and handle all necessary approvals.

Q. What happens if I sell the property?

A. The rooftop lease is fully transferable.

Q. What about taxes?

A. All related taxes are handled by CommercialSolarGuy.

Q. Can I use the electricity generated?

A. This will depend on a detailed analysis of your situation.

CommercialSolarGuy’s Ownership Advantage

We advise companies to invest in and own their solar systems for the best financial return. If this approach does not align with your business strategy, we can own the system and pay you approximately 20% of what the utility pays us.

Comparing Benefits of Owning vs. Leasing

Solar rooftop lease agreements incentivize developers to meticulously maintain their installation, as they have a financial obligation to provide regular payments to the business owner, regardless of the system’s productivity. This model promotes optimal care of the solar power system, maintaining its condition and reliability. Conversely, owning a solar power system maximizes investment returns through retaining all tax and state credits and full utility payments, which enhances Net Operating Income (NOI). However, ownership also involves concerns about operations and maintenance costs, especially when system components fail. Leasing alleviates these worries, as the developer assumes responsibility for maintenance and any associated risks, freeing the business owner from these obligations.

Tax Dynamics and Opportunity Costs

The United States incentivizes solar power through tax benefits. If your company has significant taxable activities, the ROI from a solar power system can be substantial. CommercialSolarGuy prefers owning the solar projects we build to offset our taxes, understanding that sometimes investing cash in solar might not suit every business’s strategy.

It’s important to consider opportunity costs: while solar power can reduce monthly operational costs, the initial cash investment could potentially yield a higher return if allocated to other areas of your business. This perspective helps assess whether the long-term benefits of owning a solar power system outweigh the potential advantages of using those funds elsewhere. We support ownership, but also recognize when alternative investments align better with a business’s overall financial strategy.

This income isn’t just likely—it’s as reliable as the sun rising and setting. With an O&M contract, CommercialSolarGuy even offers a performance guarantee to secure your returns. Moreover, similar to crop insurance, our solar installations can be insured against unexpected damage and underperformance. So, while contracts with the power company and the State of Rhode Island offer a promising revenue stream for the duration of the twenty-year term, our commitment to maintaining the system’s peak performance extends well beyond, with solar projects designed to outlive the contracts by decades.

If you believe your roof could be good for solar but don’t want to deal with the hassle of maintaining your own array, reach out to us at CommercialSolarGuy and we will give you a quote to rent your roof.