As the cost of installing rooftop solar panels has dramatically fallen in recent years, more West Virginia communities, businesses, and tax-exempt institutions (like schools, churches, nonprofit organizations, and local governments) want to go solar.
Unfortunately, current state law doesn’t allow power purchase agreements (PPAs). PPAs are a widely used financing mechanism for solar projects. They are a contract between a third-party developer to install, own, and operate a solar array on a customer’s property, and the customer who agrees to purchase electricity produced by the array at a fixed rate. This fixed rate is typically lower than what the customer pays to the local utility company. These contracts are set for a specific time-period, usually 15 years. PPAs are legal in 26 states, including Virginia, Ohio, Pennsylvania, Maryland, and Georgia.
PPAs are especially important because they enable tax-exempt institutions to take advantage of the federal solar tax credit. The system’s owner benefits from the tax credit and can pass those savings along to the customer through a PPA.
Solar PPAs would benefit West Virginia communities, businesses, and nonprofit organizations by:
- Enabling solar installation with zero upfront cost
- Lowering electric bills from day one
- Locking in affordable long-term electricity rates
- Avoiding utility rate increases
- Stabilizing monthly budget expenditures
In addition, solar PPAs will expand economic development, create good local jobs, and attract employers to locate and invest in West Virginia.
Moving solar forward in West Virginia
The good news is that there is growing support to legalize solar PPAs in West Virginia. It’s likely that monopoly utilities will oppose this effort, so it’s critically important for solar supporters to tell their state legislators to support this policy. It’s time for West Virginia to move solar forward!
- PPA Fact Sheet – This fact sheet summarizes why making solar PPAs legal will benefit West Virginia.
- 3rd Party Solar PV Power Purchase Agreement (PPA) – This map from DSIRE and the U.S. Department of Energy shows which states allow Power Purchase Agreements.
- Solar Power Purchase Agreements – This resource from the Solar Energy Industry Association details how PPAs work.
- Power Purchase Agreement (PPA) Expansion for Tax-Exempt Organizations – This fact sheet developed by the Southwest Virginia Solar Work group details how PPAs can benefit organizations that are unable to make use of the federal solar tax credit.
- Analysis of PPA markets in other states (California, Colorado, Maryland, Massachusetts, Nevada, and New Jersey), with implications for Georgia – This Duke University study looks at how states have benefited from enabling Power Purchase Agreements for solar energy.
- Power Purchase Agreements can expand access to solar in West Virginia – Article explains the benefits of PPAs for West Virginia homeowners, businesses, and non-profit organizations.
- State-level PPA enabling legislation
- Georgia (2015): http://www.sgrlaw.com/site/assets/files/3595/hb_57.pdf
- Virginia (2013): http://lis.virginia.gov/cgi-bin/legp604.exe?131+ful+CHAP0382
- Virginia PPA amendment (2017): http://lis.virginia.gov/cgi-bin/legp604.exe?171+ful+CHAP0803