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Commercial Solar Market Third-Party Ownership Growing


By Naomi Millán Power & Communication

Third-party ownership of commercial solar installations has been increasing since 2015, with most of the growth coming from community solar installations, according to a report from GTM Research. However, only .95 percent of commercial facilities in the United States have installed solar, says Greentech Media.

Over the next five years, projects over 1 megawatt, solar-plus-storage installations, and community solar are expected to account for the majority of the commercial solar market. As these kinds of projects are almost entirely third-party owned, it is expected that third-party ownership of commercial solar will hit a peak of 78 percent by 2021, says GTM Research. Projects smaller than 1 MW are expected to remain mostly customer-owned.

One of the reasons for the high rate of third-party ownership of solar in commercial real estate is the flexibility in financing options. Plus it puts the onus of dealing with the intricacies of the solar market in the hands of a third party instead of the facilities department.

One drawback is that if the terms of the PPA are shorter in length, the final price of the PPA will be greater, according to GTM Research.

This Quick Read was submitted by Naomi Millán, senior editor, Building Operating Management.

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