Deal Breakdown: The Story Of Our First Community Solar Anchor Deal

If you don't know who I am, my name is Dakota Malone. I co founded Community Solar Authority and today I'm doing another deal review for a central New York manufacturer. We did all the way back when we first got started in Community Solar. It was actually one of our very first anchor deals and I'm super excited to break it down in this video. Quick Housekeeping. We've unlocked access to $22 million plus in future electricity savings using Community Solar. We work with large energy users, municipalities, investors, big businesses, corporations, and we make these videos as a way to explain our business in an easy to digest way. With that being said, let's keep it rolling. I want to start with why manufacturers need to think about sustainability in the first place. And here's a quick example. They typically have many overhead costs, but amongst the largest are labor and energy. What may not be so obvious is how quickly the landscape of these costs can change and, and if you are not designed to be a resilient organization, how detrimental that could actually be. I remember I was on the manufacturing executive podcast with my friend Joe over at Gorilla 76 Marketing, shout out to Joe and we talked about the four pillars of sustainability, which to me is how I view all things sustainability. It's human, social, business and environmental. Zooming into business sustainability and overhead costs and energy. Think about how rising electricity costs are virtually guaranteed, right? If you look back historically, the cost of energy is continuing to have gone up. And you think about implementation of things like data centers and how much energy they are going to require in order to power and store and work with AI, they are going to continue to make electricity costs go up. So think about it like this. You're an average business owner, a manufacturer. You're opening up your utility bill every single month. And, and if you notice that it continues to go up every single month, you eventually reach a breaking point where you decide that you have to do something about it. And what we talk about our clients with is how do we make those decision when the stakes are low? Because again, you don't want to be on the brink of destruction. But rising electricity costs could be the difference of being in the red or being in the black on any given month. And again, we have a thesis here at Community Solar Authority, the more sustainable you are, the more likely you remain in business. Side note, last thing to think about, it's never been. And Darwin did not say survival of the fittest. He said survival of the most adaptable. And that's what this podcast is all about. How do we adapt to the changing environment of overhead costs like energy, especially being in the manufacturing space. Second thing I want to discuss, kind of zooming into this actual CNY manufacturer that we worked with was considering the energy supplier that they were already working with and adding Community Solar on top. So if you're in a deregulated market like New York or Illinois, where there is energy deregulation, where you choose the price of your electricity from a different energy supplier, this is very common for large users of electricity because it is a great way to guarantee the price and lock in or buy index blocks of energy, etc. If you don't know what that is, don't worry about it. But the point is, is that we use Community Solar as a cherry on top so that both of these things can work together and our customers can save additional dollars. When we approached this manufacturer on Community Solar, we needed to educate them that this was not energy supply. This is actually a completely different program. And again, really quick, New York has Community Solar legislation in place called New York Sun. And under this program, which is managed by nyserda, the governing energy body of New York, they allow participants to participate in local solar projects. And in exchange for helping clean the energy grid, they receive these bill credits back to their utility costs. These bill credits are designed to lower electricity costs, hedge inflation. You do it on a $0 investment and you don't have to install solar on site. Pretty good deal. Some quick education here. A utility bill has three parts. It has supply, delivery and taxes. The delivery are the lines in the pipes, the cost to deliver the energy to your location, to your facilities, and those charges show up on the bill from the utility. The supply portion of the bill is the energy supply. And so in this case of the client, they had a separate energy supplier who was charging them a fixed rate every single month that also appeared on the utility bill. And then lastly, taxes all goes to Uncle Sam one way or another, whether that's state, federal, et cetera. So if the energy supply is the procurement part of the bill, that solves how much you're using, multiplied by the price you sign up for with your energy, that solves a third of the bill. Now, Community Solar actually solves the entirety of the bill based on what shows up on the utility bill. Meaning if they have an energy supplier, but it's billed separately, Community solar. And those bill credits do not affect that energy supply. We can't include it in the discount. But if it's billed by the utility, where the supplier is listed on the utility bill, then we can use those charges and incorporate them into a Community Solar rollout. But the short bit is that you can ultimately use both. Even if your suppliers build separately, we can apply Community Solar credits directly to your delivery costs and offset your bill. And ultimately, Community Solar works as a cherry on top and in tandem with all things energy supply. Therefore, you could go ahead and choose your energy rates, get your supply locked in, and then you can use Community Solar as essentially as a coupon, which I talk about a lot on our YouTube and the podcast. Essentially is a coupon for your electricity costs so that every single month you have this discount that's automatically applied based on the value of the bill credits generated. What this really means is that Community Solar serves as a meaningful way, again on a $0 investment, no changes to the property to create a hedge against those rising electricity costs that we talked about at the top of the podcast, AKA it's extremely valuable. Alright, so let's dive into this actual manufacturing business and I can tell you all about the case study. I remember stopping into their business again. This was when we first started and it was a freezing cold winter day and I went to meet with the head guy. This was one of the very first organizations that we worked with that would be considered an anchor client or a large user of electricity. And he actually inspired me to change my entire business model after a single conversation. These guys were a private business, family owned, they had a smaller footprint, maybe spending around $100,000 a year on electricity, but they knew that they wanted to save however they could with this sustainability piece in mind. So again, at the time, a hundred K in spend would allow us to deliver about $10,000 in electricity savings every single year. I remember watching the light bulb in this guy's head go off and that also triggered it for me as well. I realized that he saw this in a investment which wouldn't cost him anything and would bring him guaranteed savings as a no brainer. And that's exactly how we see Community Solar. But it allowed me to expand my mind and think bigger. Because if he was thinking that this was a no brainer at 100k in spend, then what would someone using millions of dollars in spend think? They would also think it's a no brainer. And so going on seven years now at Community Solar Authority, for the last half decade we've been working specifically with large users of electricity, helping them access the community Solar program turnkey and make the easy decision to find ways to hedge against rising electricity costs. Ultimately, this meeting with this guy ended with An LOI and his commitment to move forward and we began to source him a community solar project. We sourced him a project. Within a couple of months he was able to enroll and sign up, access those initial $10,000 a year in savings and from there on out we changed our entire business model to exclusively working with large energy users. Thank you to this organization for helping me think bigger, set bigger goals and really aim my sights higher as an entrepreneur. This whole deal was awesome because it was a bonus point for us being that this organization and manufacturing site was located in central New York where I grew up, where my co founder grew up. We're big believers in giving back to the region that gave so much to us and raised us as young men ultimately becoming entrepreneurs. And so we love supporting the places where we grew up. If you want the case study to get the full deets, you can Message me on LinkedIn@LinkedIn.com in DakotaMillone and I will send you the PDF document. In short, Community Solar is a no brainer for large energy users. You can enhance sustainability and improve operating profit on a $0 investment without needing to install solar. There are only a limited number of community solar projects that get built every single year, which means you're going to need an expert to get access to it. If you're thinking Community Solar might be a good fit for your business strategy, we can book a complimentary strategy call to see if we're a good fit to work together. You can go to communitysolarauthority.com and book a call to get started. By the way, if you are an energy broker or anyone who has these large users of energy in your book of business and you want them to access community Solar, we are happy to have a conversation on a partnership. You can also go to our website, book a call and we're happy to see if we're a good fit to partner. Thanks so much for tuning in. Let me know if you guys appreciate these deal reviews and these stories and case studies and I'll catch you guys on the next episode.