Apple deal, tax change could spark corporate solar stampede
By Nichola Groom
(Reuters) - Apple Inc's deal to buy nearly $1 billion of power from a massive First Solar Inc plant could be the first of a stampede of contracts driven by the looming change in a solar tax incentive that makes such projects particularly attractive.
Together with a sharp drop in the cost of solar power and corporate efforts to rack up green credentials, the expiring tax subsidies have large energy purchasers taking a hard look at buying solar under big long-term contracts.
Apple on Tuesday said it would spend $848 million over 25 years to buy 130 megawatts of electricity from a 280 MW plant - the solar industry's largest-ever corporate power purchase agreement, or PPA.
Apple's major financial commitment gives solar a level of mainstream credibility that should entice other new customers.
"This is a market-making type of transaction," said Tom Werner, chief executive of SunPower Corp, a U.S. solar company that is majority owned by France's Total SA.
SunPower is already seeing a rush to get projects done before a critical federal tax credit for solar projects drops to 10 percent from 30 percent in 2017, Werner added.
SunPower, First Solar, SunEdison Inc, Recurrent Energy LLC, which is being acquired by solar panel maker Canadian Solar Inc, and 8minutenergy Renewables LLC are among the developers of the massive solar installations that have cropped up to serve the utility industry. Their size can rival that of a coal- or natural gas-fired plant.
The Apple-First Solar deal could serve as a template for other big companies like Google Inc and Facebook Inc to use large-scale solar plants to bypass utilities when they need to power their operations. Continued...