Local Lending For Solar PV: A Guide For Local Governments Seeking To Engage Financial Institutions

There is a growing opportunity for residents and small businesses to save money and mitigate the risks of fluctuating energy prices through the installation of on-site solar photovoltaic (PV) systems. However, the associated high upfront equipment and labor costs can prohibit more widespread adoption of the technology. Lending institutions have a significant opportunity to provide competitive debt financing options that offset this upfront cost and make solar installations accessible to a wider customer base. While some local and regional banks have in recent years taken advantage of this market by launching lending programs for small and medium sized solar PV projects, most markets across the country are still largely underserved. Growth in the solar industry can benefit governments and residents alike. Increasing the availability of competitive financing options from local lending institutions for residential and small commercial solar PV projects is one of the building blocks to creating a market for greater local investment. Local governments are in a unique position to engage local lending institutions on the opportunities presented by a growing solar market. Governments can offer education and resources on solar PV technology and best practices for building financial models. Additionally, governments can facilitate programs that connect these institutions to customers in the community through programs such as Solarize. This guide aims to assist local governments in engaging lending institutions on financing residential and small commercial solar PV projects to increase the adoption of solar power in their communities.