The first step is to understand the value of the project. NYSERDA has provided two calculators that are appropriate for either a jurisdictional-wide blanket calculation or a site-by-site calculation. Using the formulas created by NYSERDA, it’s simple to see how much is appropriate to request in taxes.
Note that for smaller projects under 1 MWac, it may not be worthwhile to negotiate a PILOT agreement when weighing the costs versus benefits.
The second step is to review the applicable laws and consider creating one of your own. NYSERDA again has created a resource for creating a PILOT law that ensures the entire benefits are available to the whole community.
Finally, the last step is to sign an agreement. Your jurisdiction may want to write an agreement or choose to use the NYSERDA agreement as a template.
The last word, PILOT agreements are a tool to reward communities for opening the door to solar development while still maintaining the financial feasibility of solar. The cost of solar has gone down significantly in the past 10 years, which alleviates some of the financial pressure on solar companies. Yet, the margins are still razor-thin for many of these companies, a fact, that has become more obvious during the economic impact of COVID-19. If we compare the overall carbon impact of solar, a mere 6 g/kWh, on the environment as compared to coal, 109 g/kWh, solar becomes the obvious healthier option for U.S. communities.
If you have questions about some of the facts we’ve noted here or how PILOT agreements work, please reach out to info@oyarenewables.com.