Expect the Unexpected: The Value of Asset Backup Servicing

 

As solar energy generation becomes mainstream and matures as an asset class, backup servicing has become increasingly commonplace among solar owners, investors, financiers, and other stakeholders as a way to safeguard assets and mitigate financial risk. Other mainstream industries where backup services provide protection for asset classes include mortgages, automobile financing, and student loans. Recent turmoil in the solar energy industry has only heightened the importance of well-managed solar projects and portfolios; incorporating backup servicing helps reduce risk and protect the value of energy generation investments.

Bay4 Energy’s Backup Portfolio Service is a safely stored resource that always remains on standby, ready to be utilized if a contracted asset manager or service provider cannot perform its duties. Bay4’s backup service offers insurance against unexpected business failure, severe weather, or any event that stretches a service provider’s resources beyond its capability to perform essential services that preserve project uptime and profitability.

How Portfolio Backup Service Works

A well-designed backup service must address the nuances and intricacies of each project in the asset portfolio. During the first step, Bay4 obtains complete and accurate information about each project, including data and documentation. With this audit, we identify gaps in information technology, equipment record-keeping and other areas that need to be addressed for a service provider to consistently perform all of its duties.

Bay4 asset managers and technical experts collect a comprehensive data file from the project or portfolio, enabling us to conduct data mapping and import the portfolio’s current data into our secure asset performance management platform. With a complete conversion of project or portfolio data into Bay4’s platform, the project owner can also rely on us for a more comprehensive backup service. For example, the customer can request Bay4 perform parallel or shadow processing of all data—or just partial data—with periodic reconciliations to ensure accuracy.

For facility backup support, we realize some project owners may never request that Bay4 take over portfolio servicing. It’s also understood that any data collected is stored securely and will be utilized only when asked to fill in for any project maintenance delay, failure, permit inspection, documentation, or unexpected equipment service.

This type of comprehensive backup servicing gives Bay4 a high state of readiness and allows us to transition as a successor servicer on short notice. We can also perform a number of additional key functions at the owner’s request.

Routine services such as billing and collection, active reporting and monitoring, and regular operations and maintenance (O&M) management are not included in our backup service. However, in the event the current provider can no longer perform these functions, Bay4 can immediately step in as either the O&M provider or to help select or manage a new provider.

Insurance Against the Unexpected

While backup portfolio services are relatively new to the renewable energy industry, Bay4 has been servicing projects and portfolios as the primary or backup provider since 1981. We have worked in a range of industries, including technology leasing, equipment finance, and renewable energy. Bay4 is SOC 2 compliant, which provides assurance that our systems have been examined and meet the AICPA Trust Services Criteria for security, availability, processing integrity, and confidentiality.

We hope this summary has provided an overview of the importance and need for this service and how it can protect and benefit energy asset performance.

By Thomas Biddinger, Vice President, Bay4 Energy Services, LLC

Projects and portfolios do vary, so if you have any questions about these types of services, contact us at: http://bay4.com/contact-us for more information or for a complete description of service capabilities.