The green economy has experiencing enormous growth over the past few years, and will continue to do so in the foreseeable future. Driven by tax incentives and cost benefits, many of our clients are looking for solutions to lower their energy bills. Energy savings are achievable through a multitude of green technologies, including solar, cogeneration, LED lighting, fuel cells and other technologies applicable on a smaller scale. All of these have helped create a very dynamic marketplace.

Here are the key questions for all end users:

1)   How do we go to market sensibly with the best deals?

2)   What exactly does the “best deal” mean?

Regarding solar technologies, the installation of a solar farm is quite simply a math problem. And it is essential within this math problem to look at the risk profile of all involved parties. Builders, or engineering, procurement and construction contractors (EPCC), may be at risk for commodity market fluctuations. Debt markets are always looking at long-term credt risks due to the length of the contemplated contracts. Developers invest capital funds in site work and permitting. Additionally, financiers are at risk on the output side and on the long-term viability of baseline assumptions on output and energy market prices.

The best deal is not always the one that provides the lowest price. Indeed, in our experience, it is very rarely the lowest price. The solar industry, in particular, witnesses more situations in which contracts are signed and no systems are built than in any business we have seen before. The best price and the only price that has any meaning is the price that is tied to a financial solution to is fully committed.