Page 45 - North American Clean Energy March April 2018 Issue

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YOU'RE A PROPERTY OWNER OR INVESTOR WHO ALREADY
operates or is interested in building RV and boat storage.There's an easy way
to maximize the return on your investment and generate additional pro t. It can even help the developer make faster headway through the approval process. What is it? The addition of solar panels to your RV and boat storage facility.
Adding solar to your facility increases both the revenue from the solar installation and shaded parking.This concept calculates the revenue from the solar income from either a feed-in tariff or net metering project as well as the shaded parking revenue.
Let's examine the advantages of building a solar RV and boat storage project. First it allows you to reduce your tax liability and increase your net operating income. Solar creates a secondary revenue source to bolster your storage rental income, again, increasing your NOI. A solar installation allows you to enrich the value of your real estate with a capital improvement that can be depreciated over ve years rather than the standard 30.You can also receive a tax credit from the federal government equal to 30% of the costs associated with solar. Finally, when solar canopies are installed, it supports the production of solar power, while generating revenue from the shaded parking the solar modules provide above.All the power produced is being sold back to the utility, on a 20 year xed rate contract.
The layout, design and engineering are extremely critical in the creation and success of a solar project. Generally, the project includes both solar and non-solar canopies.The goal is to maximize rentable space while erecting canopies that can support the weight of the solar components.These structures have no roof deck, and the reason they have no roof deck on them is so they qualify for the Federal tax credit and accelerated depreciation. There are other factors you need to consider when you decide to use solar for the roof shade rather than the roof decking.The solar structures require more purlins and it requires a dead load of 3 pounds per square foot, that’s what the solar panels weigh.You have to design that into the structures. Most all projects are designed so that all the of the structures can support solar
at some time in the future.The parking spaces are 13 feet wide and angled
at 60°. Perhaps the most important element in the design of the project, the orientation of the canopies.The structures are positioned to maximize the production of solar power.The slope of the roof maximizes your production. You want to keep water off of the panels and create drainage at a 10° angle.
Modules are attached directly to the purlins of the xed elevated structure speci cally engineered to support their weight.Again, the solar arrays double as the shade structures under which boats and RVs are stored.With the deadweight of 3 pounds a square foot for the panels, you have to design the structures to support the extra deadweight with additional purlins being installed. Solar panels have to be attached in a very precise way so that their warranty is not voided and no damage to the module is incurred during or after installation.The panels generate DC wholesale power that is fed directly back into the utility grid under a small generator feed in tariff program.This translates into automatic monthly revenue for the facility owner.
There are some obstacles that could affect the budget of an RV boat or any self-storage project. Solar helped surmount some of the obstacles. In many cases the city is not overly excited about the prospect of adding another RV and boat storage facility to the already crowded market in many areas.At times the project owner is faced with a good deal of opposition and several attempts to sidetrack the project.
A few of the major obstacles I’ve seen are easily taken care of with solar.
-No drainage to the property.The city wanted the owner to drain the surrounding 90 acres at the cost of 1.5 million dollars. They also wanted the owner to put in 500 feet of sewer which would cost another half million dollars. SOLUTION- The city allowed a retention pond instead of installing a drainage system, that allowed the plans to include a septic tank instead of sewer.
-There was no gas, electricity or water to the property. SOLUTION- After playing around with different options of trying to get the city behind the project, the owner prevailed over many of these red lights by adding the solar component to the site design.The water district even ran water to the facility for no charge.
All of a sudden everything opens up and began to move forward. When the city is opposed to a traditional boat RV storage facility, adding solar
quickly turns the red light green. It is like a magic wand is waved and all of a sudden the negativity surrounding the project turns into a great idea.
The other primary obstacle for an RV and boat storage project is nancing. Funding is challenging to nd for a new project in a fairly depressed community and economy.Again, the solar components save the day. Once a project secures a 20 year guaranteed revenue stream from the public utility company, the money from lenders began to ow.
In a successful Solar RV and boat storage project, the property owner purchases, installs, owns and operates the photovoltaic system at the storage location, contracting with the utility to sell all of the energy produced at a xed rate,
paid monthly for a 20-year period. By entering a feed-in tariff contract with the utility company, the owner creates a bankable annuity that he can take to the bank to secure nancing.A good example is a solar feed in tariff contract with PG&E. In this example the utility is paying the property owner $0.13 a watt over a 20-year timeframe. Basically every kilowatt produced is fed to the electric company and they pay the owner for it. It's turned out to be way better than what the owner thought it was going to be. Having had no idea of the amount of power that were producing and the way it's being paid monthly basically covered all of the owners’ debt service within 18 days. This project was cash owing in the rst 18 days. The rst check from PG&E was for $34,000.The payment to the bank was $32,000 so the project was cash owing from day one.
So how does this solar system work? The panels produce the power in DC and the electricity feeds into an inverter which then converts it to AC. Each inverter has a capacity of 500 kW. There are a half a million watts feeding into each inverter.The inverters then send the AC power over to the interconnection site at the utility power pole.The closer you are to the interconnection point of the utility, the better off you are.
To see and project how much energy the solar site is and should be producing, the owner can use an online monitoring program like Draker, which is the one used by Oakley Executive RV and Boat Storage.When you sell power back
to your utility they're going to require a monitoring system. With the Draker system you can go online and see real-time exactly how much power you're producing per inverter.The monitoring system gives you a ton of information, way more than most people are able to read, but you can tell whether or not it's producing power and how much it's producing. There's also alarms, if for some reason there's a problem, it will send you an alarm instantaneously.The metrics also make great selling points to storage consumers.
How do you know if your property is suitable for this kind of operation and how might it compare to the general proof of concept? A good candidate would be someone that owns property in a medium demographic, average middle-class
and above, around the $57,000 average income and being near a large city or on the way to recreation is ideal. From there you can look into two of the criteria that would apply. Is there a large energy need or usage on that property that we could offset? And/or Does your particular utility and state have a feed-in tariff opportunity? Your construction team can help you identify those issues and whether they
will allow you to pass the rst tier.Then look at things like interconnection and the viability of current power into the grid and whether the utility is willing to receive it in. Your facility’s’ solar options are based on your ability to secure a reservation from your local utility company for a feed-in tariff
or for net metering. The incorporation of solar to an RV and boat storage project also opens nancial avenues that might not otherwise be available to you.
The differentiating factor between a traditional storage facility and a solar RV boat storage facility, is that solar allows you to debt service the entire project and that makes it very comfortable for the bank to get a 20-year contract with the utility company, guaranteed payments. As long as they can
feel comfortable with that utility company and/or the AAA creditor, the business risk of starting a solar storage facility
is minimized.That's what we found and that's what the bank has reinforced in asking us to nd more projects that include solar with RV and boat storage.
Finally, incorporating solar into your storage project will improve the value of your real estate while creating signi cant tax advantages.A solar project allows you a 30% federal tax credit and that tax credit comes right off of what you owe Uncle Sam.You should consult with your accountant about how to best use the 30% tax credit and ve-year depreciation schedule. If you have a tax liability, you’ll like what your CPA has to say about solar.There's a whole host of ancillary bene ts as well for example, the positive public perception and general goodwill a green project attracts.
The bene ts of building a solar project is that it makes
life easier. No one wants to be in an adversarial relationship with an alternative energy project. Everybody wants to be
for Mother Earth, everybody wants to be green. I've been installing carports for over 30 years. People used to ask me, “what you do for living.” I always replied,“steel carports.” They looked at me puzzled. Nowadays they ask what you do for living and I say,“I build solar carports.” Their eyes light
up! That's the difference.We are emotionally and politically correct when we build solar projects.
I was at a Starbucks the other day and a neighbor came
over to me and said,“oh my, I just saw your commercial for the solar RV and boat storage facility.That is the coolest thing I've ever seen!” I can guarantee you if I had a commercial about
an RV boat storage facility they would not have had the same reaction, because the soul element of solar makes it really cool. It makes it interesting and makes you want to learn more about solar.We're seeing that’s the norm with the tenants and people interested in building a facility. It's a wow factor.
Storage operators obviously generate revenue by renting parking spaces for boats, RVs and other vehicles.They can make even more money when they add solar shade structures creating a second revenue source. It will not only take pro t to the next level but will also create real tax savings, reduce tax liabilities and allow accelerated depreciation opportunities.
What is the key to all of this? A solid business partner. One who can make the dream a reality. Pick a partner that has installed many of these same structures all over the United States. Find a partner that has over 30 years of experience, they have the most knowledge and expertise about the structures. They also know the best partners as far as solar goes, nationwide. Some carport installers have worked with over 50 different solar integrators throughout the United States. They can tell you who the good guys are and who the bad guys are in my opinion.Another value of choosing a veteran installer is the way they can design and optimize production, so it's not just about tting the most spaces at a project site. It is also about orientating the panels and aligning the canopy so that you can get the best production.With a great PV optimization tool, you should be able to give them a site plan, they can produce a layout of the support structures that will optimize solar.
So are you interested
in generating additional revenue with your boat and RV storage investment? Your next step is to reach out to the professionals and nd out if your existing or planned project is a good candidate to make money from the sun.
North American Clean Energy
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