Using Solar Land to Help Weather Higher Tariffs

In a move that rattled the entire U.S. solar industry, the United States Department of Commerce (DOC) announced in early April that they are opening a formal investigation into circumvention tariffs on solar products from Cambodia, Malaysia, Thailand and Vietnam. Solar experts are describing this as the ‘most serious crisis’ in solar history, warning that the effects of the investigation are immediate and potentially devastating for all solar sectors.   

Just days after the announcement from the DOC, the industry began to feel the crippling effects of the investigation. By mid-April, more than 730 respondents from 596 companies across the solar industry responded to a Solar Energies Industry Association (SEIA) survey and 80 percent said they expected either a “devastating” or “severe” negative impact stemming from Commerce’s probe.  But the effects aren’t looming in the future, the shock waves are already being felt across the country. As of April 21, 2022, 80% of survey respondents reported that their current module supply had been cancelled or delayed. With the threat of higher tariffs and disrupted supply chains, it is time for solar developers to think creatively about ways they can extract more value from their solar projects.  

Land is often an underutilized asset in improving project economics, and at a time when solar companies are trading over pennies,  SolaREIT offers developers capital solutions that can help offset the cost of increased module pricing and project delays.  

SolaREIT offers three products to solar developers for projects pre- and post-COD: land purchase, lease purchase, or solar land loan. Each of these options allows developers to monetize the land or lease, extracting cash from the project either via a lump-sum payment or a reduction in lease rates.  

With SolaREIT’s solar land loans, we value property at a higher loan to value ratio than traditional banks because we understand the value of solar leases. The landowner retains fee simple interest in the property while benefiting from a lump sum loan.  

To date, SolaREIT has worked with over 40 solar developer partners across the country to offer solutions that benefit their bottom line. The SolaREIT team has decades of experience in all aspects of the solar industry and can help developers solve even the most complex transactions.

Let’s work together to ensure sunny days ahead for the U.S. solar industry.  

Interested in learning more? Email us today at info@solareit.com to set up a call.  

Disclaimer: SolaREIT and its affiliates do not provide tax, legal or accounting advice. This article is for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.