Solar Case Studies for Tax Exempt Entities Presented By: Richard Raeke Director of Project Finance Borrego Solar Systems, Inc.

Solar is expensive at roughly $7,000/kilowatt (or $0.45/kWh) On a typical solar project, the federal tax incentives pay for more than 1/3, local or state incentive programs pay for 1/3 and the last 1/3 comes from debt or owner equity. As tax-exempt entities, universities cannot receive the federal Investment Tax Credit/Grant and bonus depreciation on a purchase. Tax Exempt Entities have to look to more creative structures, such as PPAs, in order to monetize the tax credits. Without monetizing the tax credit, a customer would have to look to another funding source, such as grants or donations to make the system economically viable. Financing Options for Tax Exempt Entities

Long term agreement to purchase electricity from a third party financier (PPA Provider) – 20 year terms, predictable cost increases No equipment to purchase, no capital investment No annual maintenance expense, no asset to manage Customers purchase only the power produced by the system A Power Purchase Agreement (PPA)

Solar PV works in states with viable incentive programs – Massachusetts – Commonwealth Solar Initiative – California – Production Based Incentive (PBI) – New Jersey – SREC program – Others include Connecticut, New York, Pennsylvania, Arizona, Colorado, New Mexico, Oregon and Hawaii The ARRA Stay tuned – incentive programs are evolving. State Solar Programs

Generate Change. Choose Solar. Case Study: Boston Community Capital Boston Community Capital received $10 million from Massachusetts through the Green Affordable Housing Initiative BCC had mission of creating the most economical solution for putting on solar on affordable housing statewide BCC issued an RFP for an installation/financing partner Chose Borrego to help identify best sites and install systems Letters sent to dozens of affordable housing owners across state Based on responses, Borrego began evaluating sites BCC created a PPA provider – Solar Energy Advantage Program Five initial sites – Cambridge, Charlestown, Webster and Pittsfield Second round of installations to follow this year

Generate Change. Choose Solar. Case Study: Cambridge Housing Authority Washington Elms: PPA Solution Boston Community Capital PPA 100 KW Sharp 175 modules SMA inverters Uni Rac ULA racking 15 degree tilt – SSW Solar on 6 buildings Reduce common load kWh by 60% 20 year $.165 / kWh PPA Annual 1.25% escalator

Case Study: Cambridge Housing Authority Washington Elms Generate Change. Choose Solar. 100 KW Sharp 175 modules SMA inverters Uni Rac ULA racking 15 degree tilt - SSW

Case Study: Cambridge Housing Authority Washington Elms: Roof Mounts and Racking Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Generate Change. Choose Solar. Washington Elms: Roof Mounts and Racking

Case Study: Cambridge Housing Authority Washington Elms: Roof Mounts and Racking Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Washington Elms: Electrical Conduit Installation Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Washington Elms Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Generate Change. Choose Solar. Washington Elms: Module Installation

Case Study: Cambridge Housing Authority Washington Elms: Module Installation Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Washington Elms: Inverter Installation Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Washington Elms: Completed Arrays Generate Change. Choose Solar.

Case Study: Cambridge Housing Authority Washington Elms: Completed Arrays Generate Change. Choose Solar.

Case Study: UCSD Borrego won RFP issued by UCSD Partnered with Solar Power Partners to provide financing Borrego signs EPC contract with SPP SPP signs PPA with UCSD Roughly $0.15/kWh 20 year contract UCSD keeps RECs UCSD provides insurance

Case Study: UCSD Generate Change. Choose Solar. Site Evaluation Customer preferences Electricity consumption Cost per kWh Available space Meter location Trenching Conduit runs

Case Study: UCSD Generate Change. Choose Solar. Prefabrication of arrays

Case Study: UCSD Generate Change. Choose Solar. Carport Construction Crane day

Case Study: UCSD Generate Change. Choose Solar. Carport construction

Case Study: UCSD Generate Change. Choose Solar.

Case Study: UCSD Generate Change. Choose Solar.

Case Study: Padre Dam Municipal Water District 862 kW of thin film over three sites and on 15-foot tall carports 546 day sales process Borrego awarded RFP Expensive installation due to carports Borrego signed PPA and Site-Lease Agreement with Padre Dam Section 48 ITC faced expiration system needed completion by Dec. 31 Borrego assigned PPA to a third-party at quoted price EPC negotiations finished mid-September 2008 Construction finished and system interconnected mid-December Bonus depreciation preserved

Case Study: Padre Dam

Case Study: Padre Dam

Case Study: Padre Dam

Case Study: Padre Dam

Case Study: Padre Dam

Case Study: Padre Dam

Case Study: Padre Dam

Solar Case Studies for Tax-Exempt Entities Richard Raeke Director of Project Finance Borrego Solar Systems, Inc. (510)