Connecticut’s Solar Lease Program Demonstrates High Borrower Fidelity
Third-party financing has become the mechanism for funding solar at the residential level in many markets. For example, third-party financed systems—which can include solar power purchase agreements (PPAs) and solar leases—are reported to have made up two-thirds of installations in the California market during the first half of 2012 . The reason for their popularity? PPAs and solar leases significantly reduce or even eliminate the high upfront costs associated with solar photovoltaic (PV) systems.
Launched in 2008, Connecticut’s (CT) Solar Lease is one such program. CT’s Solar Lease is the first in the nation to pair a ratepayer-funded organization—Connecticut Clean Energy Fund (CCEF)—with a financial institution to leverage federal incentives . The program used a combination of solar rebates, investment tax credits, and accelerated depreciation to help Connecticut residents gain access to less-expensive solar energy and lock in electricity costs. The first installation of the program ended in February 2012; the CT Solar Lease program is currently undergoing a redesign and anticipates launching the second version of the program in January 2013.