Through a variety of stakeholder engagement activities, the National Community Solar Partnership (NCSP) has learned that project funding is one of the most persistent barriers to equitable community solar development. The Credit Ready Solar Initiative leverages working groups, technical assistance, training, and strategic partnerships to build a pipeline of credit-ready community solar projects and create access to a community solar marketplace that connects owners, developers, lenders, and philanthropy to support more equitable deployment of community solar.
Why Credit Ready Solar?
While many lenders have developed financial products to serve the community solar market, developers—especially small developers or those pursuing community-ownership—often struggle to complete the necessary credit application requirements. A lack of expertise, capacity, and pre-development funds to prepare the required application materials leads to a gap in deployment of smaller, community-based community solar projects.
As part of the Credit Ready Solar Initiative, NCSP seeks to partner with lenders, philanthropy, technical advisors, community-based organizations, and developers to create more equitable access to project funds and address this critical gap in deployment.
Who Can Participate?
- Lenders: Any financial institution that deploys capital for community solar development, including commercial banks, community development financial institutions (CDFI), green banks, and credit unions are invited to engage in a working group that will develop a standardized guidance for lending funds to community solar projects. Following the development of these standards, lenders can increase their pipeline of credit-ready community solar projects by participating in the Credit Ready Solar Marketplace. Lenders participating in the Credit Ready Solar Marketplace do not need to have participated in the working group, but will agree to use the standards developed by the working group in their community solar lending.
- Philanthropists: Any philanthropic institution or impact investor is invited to engage in a working group to contribute to a Credit Ready Solar strategy by identifying a standard approach for providing pre-development funding and other gap financing opportunities. Philanthropic institutions, regardless of their participation in the working group, may also participate by engaging in the Credit Ready Solar Marketplace to provide pre-development dollars and other gap financing to small and community-based projects.
- Project Owners and Developers: Developers, community-based organizations, and others new to community solar can apply to the Credit Ready Solar initiative to receive technical assistance from DOE to complete the standardized process developed through the Credit Ready Solar lender working group, in coordination with the other working groups. Developers may also enroll in the Credit Ready Learning Lab to grow their understanding and skills in finding and applying for community solar project capital. Developers and community-based organizations can participate in the Credit Ready Solar Marketplace where they can connect with lenders ready to finance their projects and philanthropy to potentially cover pre-development costs and other financing gap needs.
How to Participate
Goals of Credit Ready Solar Initiative
The NCSP Credit Ready Solar Initiative proposes to increase equitable access to funds through:
- Standardized Lending Guidance: Financial institutions, lenders, and other renewable energy investors will identify and commit to using standardized lending guidance for community solar credit applications.
- Expand Connections with Community-Based Organizations & Small Developers: NCSP will conduct outreach to community-based organizations, developers, and other potential applicants developing community solar projects and connect them to the Credit Ready Solar Initiative and other NCSP resources.
- Develop a Credit Ready Learning Lab: NCSP will develop and launch a training program for developers, community-based organizations, and other community solar stakeholders that will provide an understanding of the components and costs of community solar development from site acquisition to operations and how to find and leverage various types of project funding. Applicants can participate in the Credit Ready Learning Lab as a supplement to direct technical assistance.
- Provide Direct Technical Assistance: Applicants will leverage the NCSP Technical Assistance program to receive personalized support to complete the standardized lending guidance.
- Identify Pre-Development and other Gap Funding: NCSP will partner with philanthropic organizations and other impact investors to identify pre-development needs such as legal fees, third party audits, and other gap financing needs. Philanthropic organizations will identify target criteria and application processes for community solar grant funding.
- Facilitate a Credit Ready Solar Marketplace: NCSP will develop and facilitate an online Credit Ready Solar Marketplace that connects lenders, philanthropic organizations, and credit-ready community solar projects. The Credit Ready Solar Marketplace will accelerate equitable access to debt and other necessary funding needed for community-based community solar for project owners and developers and create a robust pipeline of community solar projects for lenders.