Nexamp nabs $520M to build community solar across the US – Canary Media

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Nexamp, a community solar developer and project owner, has secured a whopping $520 million to install solar arrays around the nation in one of the largest capital raises to date for this growing sector.

Community solar gives renters, small businesses and organizations the chance to benefit from local solar power even if they can’t put panels on their own roofs. The approach has helped households across more than 20 states access solar that they wouldn’t otherwise have been able to. The Department of Energy aims for 5 million households around the country to sign up for community solar by next year.

Policies differ state-by-state, but typically, community solar subscribers pay a monthly charge and then receive a credit on their utility bills for the power generated by their fraction of a solar array. This credit is usually larger than the fee they pay. In many states, community solar has gained bipartisan support because of its benefits to low-income households now burdened by disproportionate energy bills.

6.5 gigawatts of community solar have been installed in the U.S. through the first three months of 2024, according to the Solar Energy Industries Association (SEIA). Nexamp, for its part, has 1.5 gigawatts of assets that are operating or in the final stages of construction, its CEO Zaid Ashai told Canary Media. It also has several gigawatts of real pipeline,” he said.

Biden’s climate law provides a variety of tax breaks to further grow community solar, including a credit for projects that specifically serve low- to moderate-income households. Community solar projects also stand to gain from other clean-energy incentives and programs created by the Inflation Reduction Act, such as the newly announced green banks.

Solar arrays deployed in community projects are often around 5 megawatts, a size that allows installations to connect to the distribution grid in spots where utility-scale solar can’t. Larger-scale installations can face delays because of the interconnection challenges plaguing transmission grid operators as well as pushback from environmental or community groups.

Supporters of community solar deployment envision these smaller projects as a way to not only democratize access to local solar power but also displace fossil fuels from the grid. Adding battery storage to a community solar array means that installations can soak up excess solar during the day and discharge it in the late afternoon or early evening hours, reducing the need for fossil gas-fired peaker plants.

Nexamp’s big-money infusion puts the company on a path to build community solar by the gigawatt, across 19 states. The funding round was led by insurance subsidiary Manulife Investment Management, along with existing investors Diamond Generating Corporation (a subsidiary of Mitsubishi) and Generate Capital.

Raising capital is never easy, especially in a high interest rate environment, but we’ve noticed investors are still encouraged by the energy transition,” Ashai said. Large insurance companies like Manulife only write big checks and can finally play in the community solar market because it’s achieved the proper scale.”

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