Solar Power Purchase Agreements & Sun Fund

Sun Fund’s Producer-to-Investor Platform (PIP) will make the benefits of Solar Power Purchase Agreements and third-party leasing of solar assets available to all investors.

The PIP will provide simple, transparent deal-making between investors, producers, and customers. Solar investments will provide transparency for all stakeholders involved. Moreover, fractional or whole ownership in renewable energy projects will allow investors to distribute their investment across various projects in order to help meet their investment goals.  Alternatively, a single project may be contacted via the PIP for one’s own use, or for one’s own investment. It has never been easier for investors to gain upside exposure to renewable energy.

Check out Sun Fund’s offer here:

Why Solar Investing Needs to Be Easier For Everyone

Today, every solar project has to go through this complex process (detailed description after the embedded podcast).

Sun Fund’s PIP will make it so renewable energy projects stop re-inventing the wheel for each and every renewable energy project. Startup costs will be driven down by our blockchain, Internet-of-Things PIP.

The PIP will also provide additional functions such as financial disintermediation, the democratization of investment, decentralization of investment, efficient globalization of renewable energy investment, lower due diligence costs, automated solar asset performance analysis, algorithmic credit analysis, and improved market liquidity. Investors and consumers of renewable energy projects will not have to cobble all of their agreements together from scratch as they have been with each renewable energy project thus far.

Reducing startup costs is important because the world wants more renewable energy projects, but the world did not have a convenient way to invest in renewable energy projects until now.

Think of Sun Fund as the smartphone of the renewable energy investment world. We’ll provide a beautiful design

Sun Fund makes it possible for all investors to get upside access to renewable energy projects worldwide. We’re tokenizing renewable energy assets for our asset-backed cryptocurrency called The Sunny.

How All Investors Can Get Upside Exposure to Renewable Energy + Blockchain Offers

If you would like to learn more about blockchain-based energy investments in the Title 3 and Reg. A Regulation Crowdfunding market check out this Blockchain Report Podcast, sponsored by Sun Fund:


An Overview of Solar Power Purchase Agreements 

Benefits & Challenges of Solar Power Purchase Agreements

Benefits for host customer

Challenges for host customer

  • No upfront capital cost.
  • Predictable energy pricing.
  • No system performance or operating risk.
  • Projects can be cash flow positive from day one.
  • Visibly demonstrable environmental commitment.
  • Potential to make claims about being solar powered (if associated RECs are retained).
  • Potential reduction in carbon footprint (if associated RECs are retained).
  • Potential increase in property value.
  • Support for the local economy and job creation.
  • More complex negotiations and potentially higher transaction costs than buying PV system outright.
  • The administrative cost of paying two separate electricity bills if the system does not meet 100 percent of site’s electric load.
  • Potential increase in property taxes if a property value is reassessed.
  • Site lease may limit the ability to make changes to the property that would affect PV system performance or access to the system.
  • Understand tradeoffs related to REC ownership/sale.

What Is a Solar Power Purchase Agreement (SPPA)?

A Solar Power Purchase Agreement (SPPA) is a financial arrangement in which a third-party developer owns, operates, and maintains the photovoltaic (PV) system. A host customer agrees to site the system on its property and purchases the system’s electric output from the solar services provider for a predetermined period. This financial arrangement allows the host customer to receive stable and often low-cost electricity. Also, the solar services provider or another party acquires valuable financial benefits in a Solar Power Purchase Agreement. Among those benefits are tax credits and income generated from the sale of electricity.

With the Solar Power Purchase Agreement, the host customer buys the services produced by the PV system rather than the PV system itself. This framework is referred to as the “solar services” model. The developers who offer SPPAs are known as solar services providers. Solar Power Purchase Agreement arrangements enable the host customer to avoid many of the traditional barriers to the installation of on-site solar systems. These include high upfront capital costs, system performance risk, and complex design and permitting processes. In addition, Solar Power Purchase Agreement arrangements can be cash flow positive for the host customer from the day the system is commissioned.

How Does a Solar Power Purchase Agreement Work

A host customer agrees to have solar panels installed on its property, typically its roof, and signs a long-term contract with the solar services provider to purchase the generated power. The host property can be either owned or leased (note that for leased properties, solar financing works best for customers that have a long-term lease). The purchase price of the generated electricity is typically at, or slightly below, the retail electric rate the host customer would pay its utility service provider. Solar Power Purchase Agreement rates can be fixed. They often contain an annual price escalator in the range of 1 to 5 percent. This accounts for system efficiency decreases as the system ages. it also accounts for inflation-related cost increases for system operation, monitoring, and maintenance. In addition, anticipated increases in the price of grid-delivered electricity are also factored in.

A Solar Power Purchase Agreement is a performance-based arrangement in which the host customer pays only for what the system produces. The term length of most SPPAs can range from six years (i.e., the time by which available tax benefits are fully realized) to as long as 25 years.

The Solar Services Provider’s Role

The solar services provider functions as the project coordinator, arranging the financing, design, permitting, and construction of the system. The solar services provider purchases the solar panels for the project from a PV manufacturer, who provides warranties for system equipment.

The Installer’s Role

The installer will design the system, specify the appropriate system components, and may perform the follow-up maintenance over the life of the PV system. To install the system, the solar services provider might use an in-house team of installers or have a contractual relationship with an independent installer.

Once the SPPA contract is signed, a typical installation can usually be completed in three to six months.

The Investor’s Role

An investor provides equity financing and receives the federal and state tax benefits for which the system is eligible.

Under certain circumstances, the investor and the solar services provider may together form a special purpose entity for the project to function as the legal entity. That company receives and distributes to the investor payments from tax benefits and the sale of the system’s output.

The Utility’s Role

The utility serving the host customer provides an interconnection from the PV system to the grid. It and continues its electric service with the host customer to cover the periods during which the system is producing less than the site’s electric demand.

Certain states have net metering requirements in place. Those provide a method of crediting customers who produce electricity on-site in excess of their own electricity consumption. In most states, the utility will credit excess electricity generated from the PV system. The compensation varies significantly depending on state policies.

If you’d like to know more about Sun Fund’s offer, check out:

Source: EPA 2018,