How to navigate solar financing in the face of recent bank failures

Bert Hunter, the executive Vice President and Chief Investment Officer, and Louise Della Pesca, the Clean Energy Finance Consultant, at Connecticut Green Bank, have joined forces. The current troubles of Silicon Valley Bank serves as a warning for solar power companies and other businesses depending on a complicated economic system to initiate, construct and provide green energy operations. SVB was a bank whose value was estimated at $200 billion, but it incurred a quick downfall that resulted in numerous organizations – particularly those involved in green energy – being deprived of their savings, credit facilities, and other finances. Many of these companies, who had put years of hard work into making their organizations, were in fear that they would soon have to cease operations. Blessedly, a scheme initiated by the U.S. Dept. The Treasury, the Federal Reserve, and the FDIC, in collaboration with state regulatory authorities, were able to address the imminent dangers, guarantee deposits and bring banking stability back. Nevertheless, the resolution of the SVB predicament serves as a lesson for solar energy companies to take into account. The industry requires significant amounts of both capital and labor. It takes a lot of time and money to get a project running. All the processes leading up to the installation of the panels need to be taken into consideration. These involve prospecting, designing, controlling and permitting the project. In addition, developing the project requires a range of capital, such as developer equity, supplier credit, working capital financing, bridge/construction funds and tax equity, plus long-term debt funding. Finding capital to finance the necessary requirements can be incredibly complex. Solar businesses need to be linked up to partners who have knowledge of the essential relationships between the different types of capital.