The Financial Climate and Economic Mechanisms that Facilitated the USA and UR’s shift towards Solar Power

The University of Richmond (UR) has been committed to sustainability and environmental innovation for many years. However, in the pursuit of carbon neutrality they have had had to weigh economic interests with their commitment to environmentalism. Due to a shifting national energy climate and the emergence of financial mechanisms by which an entity can participate in the renewable energy market, UR was recently able to invest in a 20MW portion of a nearby solar array to offset emissions from 100% of their purchased electricity. This report details the financial forces which have made solar prominent and affordable. It then explains the mechanisms that UR has taken advantage of to increase the portion of their energy obtained from renewable resources. Finally, this paper reports on the growing trend of universities entering into power purchase agreements for solar power and how UR compares to other universities. Throughout, this report comments on the ways in which economic theory is foundational to understanding the context of each economic mechanism and decision. Paper prepared for the Geography Capstone. Faculty Advisor: Dr. David Salisbur