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Jim Spano is used to being out front, creating markets and products ahead-of-their-time and being the point person for the industry and a very vocal advocate in the halls of State Houses throughout the Eastern US. Jim helped develop the solar market in the mid-Atlantic region — and after bumping into numerous issues getting his own projects financed(and dozens of other developers as well), he's bringing a new innovative product to market. New York City-based Sol-REIT is a unique solar financing platform — one he thinks will put more money in developers' pockets.
It's the first investment vehicle to bring real estate investment trusts (REITs) to the solar energy market. By financing solar in the same way as real estate, Sol-REIT can offer long-term, fixed-rate, lower-cost debt that matches the operational life of assets.
Jim, the co-founder and head of originations at Sol-REIT, wants to "break the solar industry free of the binds of niche financing."
On today's podcast, Tim Montague, a cleantech consultant and project developer for solar companies such as EDPR and Continental Energy Solutions, joins me to talk to Jim about his latest venture.
The conversation was part of the RE+ PowerUp Media Zone, a live production of SunCast Media.
If you're a regular SunCast listener, you may recall Jim's a frequent contributor to SunCast and supporter of our live events (you can hear his appearances on Episodes 172, 212, and 284). Through his role as managing partner at New Jersey-based Spano Partners Holdings and related opportunities, he's earned a leading role in the clean energy revolution, and many (including Tim and I) look to Jim as a mentor and friend.
Jim is also the founder and president of the New Jersey Solar Grid Supply Association (NJSGSA), a director of the Mid-Atlantic Solar Energy Industries Association (MSSIA), and a board member of the International Battery and Energy Storage Alliance (IBESA). He also sits on several corporate and nonprofit boards.
With his extensive background, we were eager to learn about his goals and objectives for Sol-REIT — including the specific problem he aims to solve.
Jim told us he wants to empower developers to capture the value they create and not pass it off to the aggregation market. Through Sol-REIT, he seeks to streamline access to capital for solar developers while providing investors access to green investments.
"Most banks treated solar systems more like equipment and short-term, mini perm debt, which stresses any developer's ability to own a project," Jim said.
Sol-REIT embraced a new approach that allows it to assume the risk of funding 100% of the construction costs. Eliminating that capital constraint enables developers to take projects to the commercial operation date (COD) instead of a notice to proceed (NTP) stage, he explained.
"It's just a whole new approach to financing solar by recognizing the long-term nature of the asset and matching the debt to the term of the asset," he said.
Today's podcast explores how Sol-REIT is creating an ecosystem that brings together homeowners, real estate developers and financiers — potentially unlocking the door to solar mass residential adoption. It's about making solar easier and adding value for the developers and installers to develop an additional revenue stream.
"Sol-REIT has done an amazing job at getting our investors to accept the high risk during the construction period to enable the proliferation of solar to a much greater degree in the United States," Jim said.
"If we're going to address climate change, we can't just do it at the utility-scale level. We have to be down to the very back end of the distribution systems. We have to serve the residential systems and pay particular attention to low and middle income because that's the market excluded from our industry for so many years."
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ABOUT THE HOST OF SUNCAST:
Nico Johnson is the creator and host of SunCast, consistently rated a top solar podcast in the clean energy sector. The content of the show is geared towards listeners looking for insights on where the markets are headed, how to position themselves or their companies, and what today's market leaders do to stay ahead of the pack.
Nico is an Investor, Executive Coach, and 16-year veteran of the solar industry, having led development in the US and Latin America for global companies like Trina Solar and Conergy.
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