New Venture On Commercial Real Estate DERs Aims To Shorten Interconnection Delays

July 6, 2023
Correlate Infrastructure Partners previously has secured deals to install on-site solar for corporate HQs for companies in Pennsylvania and Illinois. Together, the DEC JV hopes to unlock interconnection delays and calm upfront cost fears

A new joint venture focused on initially developing up to $100 million in distributed energy and microgrid projects will aim to speed up oft-delayed decarbonization efforts in the commercial real estate sector.

Correlate Infrastructure Partners and financial management firm eDGe Renewable Partners are uniting to form Distributed Energy Capital. The latter hopes to raise as much $100 million at the start as it works on developing solar energy projects dedicated to distributed energy and microgrids.

Industry reports indicate that many commercial real estate owners and managers want to decarbonize through on-site clean power, but are discouraged by upfront cost worries and long interconnection delays. A report from the Lawrence Berkeley National Laboratory indicated that many distributed energy and utility-scale renewable projects can take an average of five years from initial development to commissioning.

In fact, sometimes only of a fifth of announced projects make it to the operational stage, according to the LBNL report.

Correlate and eDGe’s joint venture will deploy upfront capital and distributed energy expertise to both shorten time and make the projects more economical and attractive for facilities owners and managers, the companies said.

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“Distributed Energy Capital will play a pivotal role in addressing the pressing need for microgrid and distributed infrastructure development at scale,” Correlate Infrastructure Partners CEO Todd Michaels said in a statement.

“By providing early-state development capital, paired with Correlate’s unique technical expertise, our vetted developers can deliver on key milestones,” Michaels added. “Currently, the few capital-only offerings in the market for distributed projects are inherently inept for the current opportunity in our view.”

The microgrid market doesn’t lack for growth opportunity, as numerous forecasts have indicated. A recent one, by consulting firm SkyQuest Technology, predicted that the microgrid monitoring system market alone could be worth nearly $800 million by 2030.

Michaels and his team formed Correlate after doing work on development and differentiation needs of the commercial solar market for another developer. Correlate created its own version of an energy-as-a-service model by handling upfront costs for real estate owners want to upgrade and decarbonize properties.

Earlier this year, Correlate Infrastructure Partners secured $11.9 million in funding its work to install up to 5.2-MW of on-site solar power at EnerSys corporate facilities in Reading, Pennsylvania.

In 2022, the real estate renewable developer announced an agreement to install rooftop solar at the headquarters of Continental Envelope in Geneva, Illinois.

Overall and industry-wide, the cost of solar photovoltaic installation is expected to fall from around $50 per MWh to less than $30 per MWh by 2050, according to a DNV market forecast on the levelized cost of energy of various resources such as onshore and offshore wind as well as microgrid-scale solar. 

About the Author

Rod Walton, Managing Editor | Managing Editor

For Microgrid Knowledge editorial inquiries, please contact Managing Editor Rod Walton at [email protected].

I’ve spent the last 15 years covering the energy industry as a newspaper and trade journalist. I was an energy writer and business editor at the Tulsa World before moving to business-to-business media at PennWell Publishing, which later became Clarion Events, where I covered the electric power industry. I joined Endeavor Business Media in November 2021 to help launch EnergyTech, one of the company’s newest media brands. I joined Microgrid Knowledge in July 2023. 

I earned my Bachelors degree in journalism from the University of Oklahoma. My career stops include the Moore American, Bartlesville Examiner-Enterprise, Wagoner Tribune and Tulsa World, all in Oklahoma . I have been married to Laura for the past 33-plus years and we have four children and one adorable granddaughter. We want the energy transition to make their lives better in the future. 

Microgrid Knowledge and EnergyTech are focused on the mission critical and large-scale energy users and their sustainability and resiliency goals. These include the commercial and industrial sectors, as well as the military, universities, data centers and microgrids. The C&I sectors together account for close to 30 percent of greenhouse gas emissions in the U.S.

Many large-scale energy users such as Fortune 500 companies, and mission-critical users such as military bases, universities, healthcare facilities, public safety and data centers, shifting their energy priorities to reach net-zero carbon goals within the coming decades. These include plans for renewable energy power purchase agreements, but also on-site resiliency projects such as microgrids, combined heat and power, rooftop solar, energy storage, digitalization and building efficiency upgrades.

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