Photo Credit: BlueWave Capital
Morgan Stanley subsidiary MS Solar Solutions committed $100 million to solar developer BlueWave Capital to build more than 25 megawatts of community solar in Massachusetts by the end of 2016.
The backing from Morgan Stanley is the first major financing for BlueWave’s community solar projects in Massachusetts. If successful, the mission-driven solar developer expects to expand the portfolio to other states next year.
“This represents a major boost to Massachusetts' community solar market,” said Cory Honeyman, senior solar analyst with GTM Research, which has forecasted 44 megawatts of community solar in Massachusetts next year. “This announcement will play a key role in not only realizing, but potentially exceeding, expectations for the Massachusetts community solar market in 2016,” added Honeyman.
BlueWave says it has more than 500 megawatts of solar projects in development, about one-tenth of which are in Massachusetts. The company is headquartered in Boston, but also has offices in South Carolina, North Carolina, South Africa and the Bahamas.
Community solar is expected to transform into a mainstream market in coming years, according to GTM Research, with a sevenfold increase projected in just the next two years.
In Massachusetts, at least, Morgan Stanley is at the forefront of driving the community solar market. Earlier this year, solar developer Clean Energy Collective teamed up with MS Solar Solutions to finance more than 50 megawatts of community solar over the next 18 months. Massachusetts-based companies Nexamp and Next Step Living have also launched community solar offerings.
One of the keys to the growth of community solar in Massachusetts is whether virtual net energy metering caps stay in place. The portfolio of projects that BlueWave just announced with Morgan Stanley will fall under the existing net metering caps. The first two BlueWave projects are in Oxford and Fairhaven and total 2.5 megawatts. They will be operational starting in March.
Massachusetts is one of the early leaders in community solar, with Minnesota, Colorado and California also at the top of the pack. In just a few years, however, the playing field should be much wider.
“The community solar opportunity is poised to become more geographically diversified,” said Honeyman, “as developers ramp up service offerings to utilities in states without community solar legislation in place and as national rooftop solar companies enter the community solar scene."