 |
Green Warrior's OES™ Project Pipeline Nearly Doubles to 44 Megawatts:
120-Acre Solar Farm in New Mexico and 100,000 SF Manufacturing Site in Upstate New York
|
|
|
Green Warrior's sales team has been on a real hot streak this quarter. Among the many potential OES customers identified by the team, two are particularly promising.
New Mexico Solar Farm
The first is a potential solar farm located on 120 acres of open land near the town of Columbus, New Mexico. The land is an L-shaped parcel containing three square blocks of approximately 1,300 feet on each side.
The land is just off a major highway. Tying to the local power grid should be
straightforward, as a power line runs along the road that borders the northern edge of the property.
A letter of intent is currently being negotiated with the property owner. Once signed, Green Warrior's OES analysts will begin an exhausting feasibility study. This will provide the basis for a Power Purchase Agreement with the landowner.
According to a study published by SolarByTheWatt.com, modern, highly-efficient solar farms require 4 to 4.5 acres to produce 1 megawatt (MW) of electricity. Assuming the installed solar farm would cover approximately 100 acres of land, the system could produce between 22 to 25 MW of power.
OES in NY State
Also in the pipeline is a 100,000 square foot manufacturing facility outside of Buffalo, New York. Green Warrior's team identified this facility as ideal for an OES, given the large, flat roof and high energy demands of the facility. Green Warrior is also investigating this site as a potential candidate for our PowerWarrior solutions, due to the large number of electric motors powering the equipment in the building.
As with the New Mexico site, a letter of intent is pending, which will be followed by a feasibility study to determine benefits to the property owner, proper OES sizing and potential returns to Green Warrior.
.
top>
|
|
|
 |
|
|
The Second Marketing for Solar Energy: Power Purchase Agreements
By Dr. Nicholas Green
President, Green Warrior |
|
|
The response to Green Warrior’s On-Site Energy System™ business model has been tremendous. By offering zero-cost solar systems to land and building owners, Green Warrior has been able to secure Power Purchase Agreements from property owners across the country.
Power Purchase Agreements (PPAs) are the contracts that specify the terms under which the OES customer receives and pays for the power produced by the OES. PPAs typically span 20 years, providing an incredibly secure long-term revenue stream for the PPA owner—in this case, Green Warrior.
OES customers receive an initial discount of 20% off the historical average of their power bill. And the discount can grow substantially over time. Remember, OES customers pay nothing for parts and labor, licensing, fees, permits or any other cost associated with the OES. They simply buy the power it produces.
Power Purchase Agreements Translates to Short- and Long-Term Returns
Green Warrior’s ability to identify, qualify and fully implement our PPA customers has caught the attention of institutional players who are interested in participating in the company’s success. Specifically, solar integrators and system installers are negotiating to purchase Green Warrior PPAs. Banks, hedge funds and other financial institutions also realize the long-term potential of these contracts.
“I have personally met with several financial institutions who have stated they are prepared to purchase as many solar PPAs as we can provide them,” said Bruce Bowen, general manager with Green Warrior. “Historically, the biggest barrier to installing commercial or industrial-grade solar systems is the significant capital outlay required. If Green Warrior simply sells a PPA for a significant percentage of total value, we create instant revenue.”
“Lendable” contract
PPAs are considered lendable documents, like a land title, mortgage or loan contract. This allows Green Warrior to leverage the value of the PPAs to obtain debt equity for future ventures—effectively increasing the scope and value of future projects. Revenue Green Warrior will generate from the sale of PPAs could be used to develop other products or to fund OESs that have high profit potential.
A Green Warrior PPA is evaluated on the income stream that will be realized over a twenty-year period, based on the energy it produces.
EXAMPLE:
A Green Warrior OES generating $12,000 a month in
electricitycreates $144,000 a year in revenue
At $144,000 a year, this same OES has a value of $2,880,000
over the 20-year life of the Power Purchase Agreement
Green Warrior is in the business of solar, and we will continue to identify PPA customers with the highest potential return and install OESs on their properties.
Power Purchase Agreements are a win-win-win for Green Warrior, our OES customers and the potential purchasers of these valuable contracts. We expect interest in this secondary market for solar energy to grow dramatically. And you can bet Green Warrior will be at the forefront of this exciting new, and potentially enormous, market.
top>
|
|
|
|
|
|
Irvine, CA, Onsite Energy System™ Goes Online |
|
|
Green Warrior’s rooftop Onsite Energy System™ on a manufacturing/warehouse facility in Irvine, CA recently got the green light from city and utility officials to go online. The OES, which consists of 188 rack-mounted panels producing 42 kilowatts, is functioning perfectly.
The host facility’s owners will save nearly $150,000 in electricity costs over the life of the solar Power Purchase Agreement, with an initial savings of 20% in the first year.
Because the addition of a premium solar system qualifies as a capital improvement to the building, the owner may also realize an increase in property value. This could be worth between $86,000 to $140,000, based on 12 to 20 times the annual energy savings (and current market conditions).
Like all Green Warrior OESs, this system cost the host facility’s owner nothing. Green Warrior assumes all capital costs for product, labor, licensing, fees and permitting associated with the installation and on-going maintenance and support of the system. The owner benefits from lower power bills, reduced carbon footprint and increased property value.
With the system online, Green Warrior is set to receive considerable rebates and incentives from both the state and federal government programs. In this case, the company will receive nearly 50% of the gross costs of the system back in the form of cash grants.
Because Green Warrior owns the OES and the power it produces, the company has a guaranteed 20-year revenue stream. Excess energy produced by the system that isn’t consumed by the host facility can be sold back to the grid. In the event that the current owner vacates or sells the building, Green Warrior is protected by an easement clause in the Power Purchase Agreement that allows the company to continue to own and operate the system regardless of tenancy of the building. Green Warrior can continue to sell the electricity generated by the system back to the utility even if the building is vacant.
If you would like to save 20% or more off your electricity bill, run a greener business and improve your property value--with no capital outlay--contact Green Warrior at 949-382-6900 or online at GreenWarriorInc.com.
top>
|
|
|
|
|
What Can We Learn From the GM Volt?
Electric cars and solar go hand-in-hand, right? Now there’s strong evidence from GM to support this statement.
|
|
|
At a recent Automotive News Green Conference, Tony Posawatz, GM’s vehicle line director for the Chevy Volt, and Volt marketing manager Christi Landy provided attendees with a revealing look at the Volt’s customer profile.
The Volt is a plug-in hybrid that can be used exclusively as an electric vehicle for around-town driving, or it can generate its own electricity with its 1.4 litre on-board gasoline engine.
In a recent report for greencarreports.com, senior editor John Voelcker summarized some of the key points put forward by Posawatz and Landy. First, Chevy is selling as many of the $40K+ cars that it can get to the showrooms. Second, 90 percent of trade-ins for Volts were non-GM. That means the company is winning share away from Japanese and European automakers with its high-quality, feature-rich hybrid. Interestingly, 33 percent of the trade-ins were other hybrids. This speaks to owners’ satisfaction with this category of car.
While it’s easy to dismiss these early adopters as the greenest of green, there’s more information that we feel is revealing of a larger trend. Because of the Volt’s integrated OnStar® link, GM learns quite a bit about Volt drivers’ habits. Like the fact that nearly two-thirds of all miles driven in Volts have been exclusively powered by plug-in electricity, as opposed to electricity generated by the Volt’s gas engine. That means real world data reveals the Volt is a true 100 mile-per-gallon car, with drivers averaging more than 1,000 miles before they had to fill their tanks.
24% Have or Will Go Solar
So where does solar come in to play? Posawatz and Landy’s research also found that nearly a quarter (24 percent) of Volt owners either have or plan to buy PV solar systems for their homes for the express purpose of charging their Volt with non-grid power.
Hybrid and electric vehicles, we feel, are not a passing fad. They are an increasingly popular option for buyers who feel the pinch at the pump. It just makes economic sense. While the Volt costs more than a similar-sized domestic sedan, the incredible fuel economy—coupled with free electricity from a home solar system—mean that the true cost of ownership for the Volt and similar plug-in hybrids is on par or less than all-gas cars.
top>
|
|
|
|
|
Big Oil, Google and Military Buy Into Solar
|
|
|
In a recent article in Energy and Capital entitled “Solar for Dummies,” editor Nick Hodge called solar naysayers out with some very compelling facts.
Total (NYSE: TOT) Pays $1.4 Billion for Stake in SunPower Army/Marines Charge Critical Equipment With Solar Panels Google Invests $280 Million in SolarCity Solar Market Tops $70 Billion in 2010
How did the solar market grow from tree-hugger pipedream to billion-dollar-plus acquisition target for Big Oil?
There several drivers at work. Domestic oil production is weak. Despite the current optimism driving the market, we will never again see the 10-million barrel/day production that peaked in 1970. That was over 40 years ago. We’re lucky to produce over 5 million barrels a day now. And demand in the U.S. is currently 19 million barrels a day. Obviously, home-grown energy is a dire need. One that can’t be addressed by some mythic boost in domestic production or reliance on foreign oil.
Secondly, solar costs are dropping, greatly reducing the barriers to entry for enterprising solar utilities, like Green Warrior, to quickly deploy smaller solar arrays that address targeted needs for energy. This agile business model can address consumption needs on a per building or neighborhood basis. Plus, many states and counties have growing requirements for utilities to purchase a significant percentage of their power from renewable sources.
In his article, Hodges illustrates the enormous growth the solar industry has realized in a very short amount of time.
At the turn of the century the world only had 1.4 gigawatts (GWs) of installed solar capacity.
By the end of last year 40.7 GW had been installed – a growth of 2,752%.
Oil didn't do that. Coal didn't do that. Nuclear didn't do that.
Most of the growth has come from Europe – particularly Germany with 17 GW – which boasts over 75% of all installed solar worldwide.
Their head start can be attributed to attractive policies the U.S. failed to embrace. But falling prices, as you'll soon see, will mean the spread and mass adoption of solar in the next few years.
Falling Prices = Increased Adoption
The price per watt for solar panels is currently about $1.50. In 1970, the year oil production peaked in this country, that number was $60 per watt.
Technological advancements are making the panels more efficient, while competition among manufacturers worldwide is increasing. This combination will continue to push the price per watt downward over time. According to Hodge, for every doubling of solar manufacturing capacity, costs fall about 20%.
In some parts of the country solar is already cheaper than energy purchased through a utility. That means costs have dropped below “grid parity,” a term used to describe cost equality between solar and utility energy.
Solar vs. Nuclear
Solar installations are being completed at a compounded annual growth rate (CAGR) of nearly 65%. Last year alone more than 17 GW were installed.
From Hodges' story:
…as SunPower (NASDAQ: SPWRA) founder and chief technology officer Tom Dinwoodie (the man who just sold a majority stake of his company to Total for $1.4 billion) puts it:
"That 17 gigawatts installed in 2010 is the equivalent of 17 nuclear power plants -- manufactured, shipped, and installed in one year. It can take decades just to install a nuclear plant. Think about that. I heard Bill Gates recently call solar 'cute.' Well, that's 17 gigawatts of 'cute' adding up at an astonishing pace.
We'll still need nuclear baseload power to be sure. The point here is twofold.
Solar is being installed on a nuclear scale but much faster. We've reached the point where increased installation rates and falling prices are feeding off each other.
The Outlook
Globally, the United States lags behind European countries in solar adoption, with Germany being the clear leader. This is mostly due to healthy government subsidies and growing interest in weaning the country off of nuclear energy in the wake of the Fukushima disaster. Still, solar installations are projected to double almost three times by 2020.
At home, many states are upping the percentage of renewable energy required of utilities. There is also a growing movement to consolidate energy purchasing power—and demand that it come from largely renewable sources—called Community Choice Aggregation. We feel that neighborhood-level demand for solar will greatly accelerate the adoption of small to medium sized solar developments.
Our pipeline is steadily growing—and will double with the addition of the New Mexico and New York projects. In fact, demand for OESs has far outstripped our ability to build all the OESs requested by potential customers. This has created a viable, and potentially very lucrative, secondary market for our Power Purchase Agreements. Please see the article at the beginning of this newsletter for a more in-depth discussion of the PPA market.
Green Warrior is riding the rising tide of the solar movement. As interest in this exciting—and essential—field grows, so do the opportunities for the company.
top>
|
|
|
|
|
|
|
