100 Commercial Solar Projects Completed By Safari Energy With Self-Storage Company
Credit to Author: Jake Richardson| Date: Fri, 14 Feb 2020 19:00:52 +0000
Published on February 14th, 2020 | by Jake Richardson
February 14th, 2020 by Jake Richardson
Safari Energy recently announced it has completed 100 commercial solar projects in 13 states with the very large self-storage company Extra Space Storage. A 531 kw system is the largest of the 100; its location is Central Valley, NY. In 2018, the two companies collaborated to install 6.7 MW of solar power systems at 58 Extra Space Storage properties. The company has over 1,800 self-storage facilities in the United States, including some in Puerto Rico. Based in New York City, Safari Energy was founded in 2009. John Lind, Managing Director of Business Development at Safari Energy, answered some questions about the collaboration for CleanTechnica.
Image credit: Safari Energy
How did you begin working with Extra Space Storage to install solar power arrays at its many storage locations?
It started in 2013, when we approached Extra Space to learn more about their existing solar program, which had already completed several projects at the time. We explained Safari Energy’s approach – being strategic and flexible, our track record working with REITs and our model to build long-term relationships focused on creating value by being more of a partner than a vendor. We were awarded five projects on Long Island in New York, where we creatively developed both a net energy metering system for onsite consumption and a Feed-in-Tariff system to maximize value for Extra Space. Such a successful approach resulted in Safari being able to scale up its business and provide value-accretive services to many of its customers.
In the press release, the savings at many of the sites is mentioned:
“…the solar projects that Safari Energy developed for Extra Space offset more than 80% of each site’s energy use, with approximately 20 sites offsetting more than 95% of their energy use…”
On average, about how much does adding solar power at a self-storage location reduce utility-based electricity consumption, and how much could each site save each year by generating most of its own electricity and self-consuming?
It depends on the type of site and the self-consumption at the site. As a rule of thumb, a typical self-storage site will offset approximately 90% of its energy use. Self-storage sites don’t usually consume a lot of power, though, so for self-consumption (aka behind-the-meter) projects, the amount saved really depends on how much energy is needed (how many units, are they temperature-controlled, what type of lighting is used), as well as the owner’s ability to claim federal tax credits and state incentives. The economics of a solar project can also be greatly impacted if you’re able to sell excess power back to the grid (aka net metering). With net metering, we can maximize the solar system size, which could result in enhanced project economics for the customer. Additionally, when working with REITs, the proposition is not solely about utility bill savings, but also value creation at the property level and realization of the sustainability benefits.
Over the lifetime of the solar power installation, if it is 25 years, how much could a single self-storage site save?
Again, it depends for a REIT. Because they’re tax exempt, REITs use Taxable REIT Subsidiaries (TRS) for non-qualifying REIT revenue, which, as the solar system owner, allows them to monetize the tax benefits generated from the system. In turn, the TRS makes a lease to the property (aka the REIT) for the use of the roof and sells it electricity. It’s not solely about the utility bill savings in this structure. It’s also about the project’s return on investment and contributions to sustainability.
Will you continue working with Extra Space Storage to develop more solar power installations?
Yes – we have many additional solar projects in the pipeline with Extra Space Storage from coast to coast. Commercial clients with large portfolios are our sweet spot, since we can replicate several aspects of a project across various sites for multiple customers. We’re also able to utilize solar panels that we’ve procured (“safe harbored”) to get maximum the federal tax credits for our customers.
Many self-storage facilities have large amounts of roof space, which makes them good candidates for solar panels. Are there any particular details or concerns with solar panel installations on self-storage building roofs?
As mentioned, self-storage facilities can often be “consumption constrained.” This means that when a storage site can’t sell excess power to the grid, it only needs to accommodate a small solar system to offset low-power consumption by small lights, security cameras, administrative office products. A lot of people see large, flat roofs and want to lay solar across every square inch, but this is often not the most efficient approach for self-storage. A few markets have Feed-in-Tariffs, when the utility offers to purchase all electricity produced at an established rate and term. In this case a site can fully utilize the roof, subject to structural and interconnection approval. Self-storage facilities also often feature metal corrugated roofs, which require special clamps to secure the panels. This can be a plus, because it eliminates concerns about roof penetration, and can reduce UV damage and overheating that the roofs would otherwise endure.
Will you also be working with other self-storage companies?
Yes, we have completed and active projects with many other self-storage companies.
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Jake Richardson Hello, I have been writing online for some time, and enjoy the outdoors. If you like, you can follow me on Twitter: https://twitter.com/JakeRsol