The completed solar farm is an 8.5 MW project located in Houston, Alaska. In 2022, CleanCapital embarked into the new, emerging market of Alaska by partnering with RIPP to bring solar energy to Alaskans and to diversify the energy mix in the state. Matanuska Electric Association (MEA), the local utility and offtaker of this project, will purchase cost-competitive power from the project to benefit its members. The project was also supported by a loan from the Alaska Energy Authority (AEA).
Traditionally, the state of Alaska has relied on natural gas as a key energy source and ranks fourth in the nation in natural gas gross withdrawals. While Alaska does not have a renewable portfolio standard it does have a nonbinding goal to reach 50% renewable energy by 2025. The RIPP team faced challenges to bringing solar energy into the communities of Alaska like workforce education, supply chain, manufacturing resources, financing, and construction standards. Additionally, understanding and preparing for the challenges the climate poses in such a Northern climate with severe snow accumulations presented design and engineering challenges. The RIPP team needed the right partnerships to finance, develop, and construct the 8.5 MW solar power project as well as own and manage it in the long term. Securing financing from a partner in the ‘Lower 48’ was critical, but awareness and interest in opportunities in Alaska was low. To complete this project, the RIPP team needed to find the right team with the right tools and depth of renewable energy knowledge.
The non-profit group Launch Alaska, which works to accelerate the renewable energy transition in the state by connecting businesses and investors with AK opportunities, introduced the RIPP team to the New York-based clean energy investment team at CleanCapital. CleanCapital, armed with years of experience in middle market solar energy and a bench of solar power and storage market experts, jumped at the opportunity to invest in the project. Given the unique nature of this project and its location in the thus-far underdeveloped state of Alaska, it was clear that a traditional, hands-off project financing was not the best approach to getting this project over the finish line. As such, CleanCapital and RIPP embarked on a more fulsome partnership that included a corporate investment in the RIPP team and its future pipeline in addition to development capital. The CleanCapital team worked alongside the RIPP team through every step of the process, providing guidance and expertise as well as financial support.
The RIPP team brought their local expertise to this project. The project created 30-40 construction jobs which were all trained and hired from the local area. Additionally, they added unique touches to the project to support success despite weather related conditions. These updates included high set solar panels, bifacial panels to collect solar reflection from snow, and minimally disrupted the underground soil levels during construction to reduce environmental impact. When fully operational, the solar array will power approximately 1,400 homes per year, helping to stabilize energy prices and diversify energy generation in Alaska.
Financing: CleanCapital has leveraged its capital markets expertise to secure tax equity and debt to finance the Houston Solar project. CleanCapital was able to provide RIPP with guidance with regards to securing necessary deliverables required by financing parties. The project received tax equity financing from NelNet, Inc., and secured a loan from the Alaska Energy Authority (AEA) Power Project Fund (PPF).
Diligence expertise: Through CleanCapital’s internal diligence processes, each party was able to proactively establish the necessary steps to secure the proper third-party engineering analysis and reports to identify and potential future operating risks. Additionally, CleanCapital’s construction team worked closely with RIPP to source major equipment for the project.
Industry Knowledge: Since 2015, CleanCapital has been a major investor in the commercial and industrial renewable energy market. CleanCapital brings a wealth of industry knowledge to the partnership with RIPP, which partnered with RIPP’s knowledge of the Alaska energy markets, northern solar design and operation, and credibility with local utilities, creates synergies that will accelerate the growth of renewable energy across Alaska.
Relationship and asset management: CleanCapital is the long-term owner of the Glacier Bay asset and will work closely with RIPP as the O&M provider to operate and maintain the health of the assets to ensure the output is maximized throughout the life of the asset.
The success of this partnership has set the stage for exciting pipeline projects to be pursued by CleanCapital and Renewable IPP (RIPP). CleanCapital saw high value in the team at RIPP, the opportunity to scale an emerging market, and the future of shared services to foster critical development partnerships. CleanCapital’s investment will fund RIPP’s operations as it works to continue to accelerate the development of its future pipeline in Alaska.
The partnership between CleanCapital and RIPP showcases how strategic partnerships in unlikely emerging markets can result in progress for the clean energy transition. This 8.5 MW project is just one leading example of how local utilities, investors, and developers can build the future of clean energy for the local communities.
CleanCapital continues to be at the forefront of renewable energy investment, working diligently to expand its portfolio and empower companies like RIPP to lead in sustainability and make a positive impact on the planet.