Silicon Ranch Corp., a solar developer backed by oil giant Royal Dutch Shell Plc, acquired a startup that funds its clean energy projects by selling carbon offsets.
Nashville, Tennessee-based Silicon Ranch bought Clearloop for an undisclosed amount to build utility-scale solar projects in distressed communities that’ll be financed by selling emissions credits to companies seeking to cut their carbon footprints, Silicon Ranch Chief Executive Officer Reagan Farr said. Silicon Ranch can fill in the financing gaps with its investors, such as Shell, and other tax-equity partners.
Clearloop recently broke ground on its first 1 megawatt project in the state with a company buying offsets for as little as $1,000, an idea inspired by crowdfunding, founder and CEO Laura Zapata said. The approach eliminates the need for long-term power sales contracts.
“The Clearloop model democratizes the ability to participate in the energy transition,” Farr said in a telephone interview.
This new model could make solar projects more accessible for companies that haven’t had the ability to commit to 20-year contracts to buy power such as Amazon.com Inc., WalMart Inc., Apple Inc. and other corporate giants. The goal is to target communities that haven’t seen investments in a long time or places where “the grid tends to be the dirtiest,” such as the Mississippi Delta and Appalachia, Clearloop’s Zapata said.
Clearloop plans to announce three more projects in the next six months, with about 10 megawatts of capacity.
For Shell, it’s another way to expand on its goal of becoming the world’s largest power producer. Last year, the company, like many of its peers, ramped up its climate ambitions with promises to cut emissions and diversify into cleaner sources of energy. Its $3 billion-a-year ceiling for spending on renewables and low-carbon technologies compares with the $8 billion it has set aside for oil and gas this year.
Silicon Ranch has built almost 2 gigawatts of solar generation in about eight years and currently has 700 megawatts under construction. The next Clearloop projects will be at least 3 megawatts, Farr and Zapata said.
–With assistance from Laura Hurst.
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