Solar project developers are always looking for innovative ways to add value to projects, whether it be using a variety of products and techniques to increase system production, working with installers and suppliers to reduce procurement costs, or reducing soft costs through streamlined design and permitting processes. Pairing solar carports with Electric Vehicle (EV) charging stations is becoming one of the more common ways to add value to projects in California.
Solar carports have long been a way to address the challenge of inadequate roof space or lack of available land for commercial solar projects. EVs are quickly becoming more common, and with the Governor of California announcing just last week that all new cars sold within the state must be zero emission vehicles by 2035, that trend will only accelerate.
WithEV adoption on the rise, EV charging stations will need to keep up with the increasing demand. The owners ofsolar powered EV charging stations in California will have the ability to monetize the environmental value of their solar carportassets, creatingsignificantadded revenuefor these projects
In 2018, the California Air Resources Board extended the Low Carbon Fuel Standard (LCFS) program to 2030 and added significant changes to how the program would be implemented moving forward. The program is designed to incentivize the use of low-carbon transportation fuels, including EVs charged by renewable energy sources. The main driver behind this program to achieve the goal of reducing greenhouse gas emissionsis a broad cap and trade program.Cap and trade programs work by setting a strict limit on greenhouse gas emissions and allow companies to buy and sell allowances, or credits, depending on if they are above or below the cap.The LCFS cap and trade program creates a market for what are known as LCFS credits, which can be generated by EV charging stations powered by solar PV systems. One LCFS credit is equal to one metric ton of CO2 reduced.
The value of an LCFS credit is market based. Over the last few years and for the foreseeablefuture, these LCFS credits will trade at values that give solar developers contracted revenue for their projects that include EV charging stations. Giventhat electric vehicle adoption is expected to increase, those charging stations can be expected to be called upon on a consistent basis to charge vehicles, generating LCFS credits that create additional value for solar projects for years to come.