financing
big ideas
in solar
Drew Torbin, Prologis’ vice president of renewable energy, has worked with Bank of
America since early 2010 to put the final packaging on Project Amp. The 733-mega-
watt project will be comprised of hundreds of industrial rooftop arrays in 28 states.
Ramping Up
Distributed
Solar by MIKE KOSHMRL
Dennis schroe Der/nre L
Photovoltaic (PV) solar projects in the united States can usually be divvied into two categories: distributed- and utility-scale generation. Project Amp, a new $2.6 billion solar development, is blurring the lines.
Forging a Framework
In 2009, Bank of America developed a proof-of-concept business model for what would become Project
Amp. The framework was aimed at building wholesale
rooftop solar up to the utility scale, and it fit in nicely
with a larger 10-year, $20 billion environmental business
initiative that Bank of America launched in 2007. Plowe
approached “literally dozens” of renewable energy businesses, before settling on Prologis in 2010. Looking back,
it was an obvious partnership.
The San Francisco-based real estate giant had already
made a good splash in solar, with 60 M W of PV online or
under development. Drew Torbin, Prologis’ vice presi-
dent of renewable energy, saw that as a starting point.
Torbin, a graduate of National Renewable Energy Labo-
ratory’s “energy executive” program, had some 400 mil-
lion square feet ( 37 million square meters) of domestic
rooftop in his pocket. Typically, Prologis holdings are
large distribution centers or warehouses, clustered in
business parks near population centers. “These buildings
are phenomenal places [for solar],” Torbin said. “In fact,
I can’t image a better place to host a solar array — they’ve
got large, flat, unobstructed roofs.”
Before Project Amp, Torbin faced a number of
finance-related challenges. For a 2008 multisite project
in Southern California, Prologis leased space to Southern
California Edison, which assumed system ownership. For
other Prologis solar developments, integrator businesses
handled financing. “The one piece that we didn’t have
© m Att kn AnnLein/ istockPhoto.com
At 733 megawatts (MW), Project Amp fundamentally
departs from conventional commercial-scale distributed
solar. For one, arrays under its umbrella will be found
on some 750 warehouse rooftops in 28 different states.
Looking back years from now, its organizers — Bank of
America Merrill Lynch (financer), Prologis (system host
and project owner) and NRG Energy (lead investor) —
might be able to boast the industry’s first true example of
distributed, utility-scale solar.
“We feel that Project Amp is transforming the solar
industry,” said Jonathan Plowe, Bank of America’s man-
aging director. “And not just a narrow corner of it, but
really the whole industry. It’s revolutionizing how solar
can be financed and rolled out.”
Indeed, Project Amp’s outliers go beyond the
immense scale and multistate rollout. Plowe says it’s
the first distributed solar project to sell all of its power
back to the grid, altogether forgoing net metering. It’s
also the first project to raise long-term, fixed-cost debt
financing, a powerful tool for keeping costs competitive.
Adding to the list, Project Amp marks the first solar proj-
ect that will receive a credit rating from an outside credit
agency — a salability booster for future transactions in
the capital markets. Finally, there are some innovative
aspects of the financing structure. It is, for example, the
first distributed-generation project to receive backing
— $1.4 billion — from the U.S. Department of Energy’s
(DOE) Loan Guarantees Office.
38 September/October 2011 SOLAR TODA Y solartoday.org
Mike Koshmrl is an associate editor
of SOLAR TODA Y. Contact him at
mkoshmrl@solartoday.org.
