Currents Podcast Ep324: Evolving Community Solar and Storage

Date: November 13, 2025
Host: Todd Alexander (Norton Rose Fulbright)
Guest: Stefano Ratti, CEO of Shaberton – Community Solar and Storage Developer

Episode Overview

This episode explores the dynamic evolution of community solar and distributed storage in the U.S. Stefano Ratti shares insights into Shaberton’s changing business model, market trends, storage integration, legislative impacts, financing challenges, and the outlook for distributed generation amid shifting federal and state policies.

Key Discussion Points & Insights

Background and Business Model Evolution (00:30–02:09)

• Origins & Markets:
  • Shaberton began in 2019–2020 as a pure community solar developer in the Mid-Atlantic (Maryland), expanding to Delaware, Virginia, Pennsylvania, Illinois, and New Mexico.
  • Focused on 1–10 MW distribution system projects ("community solar" scale).
• Business Model:
  • "Pure play developers": manage land, permitting, engineering, community relations, and construction.
  • Historically do not own/operate projects post-construction (develop and sell).
• Strategic Shift:
  • Growing from “solar-only” to integrating storage—“taking the storage piece a lot more seriously.”
  • Eyeing standalone storage solutions as well.

"We're really changing from a solar only company to a solar and storage company. So really taking the storage piece a lot more seriously and adding it to a lot of our projects and even going into standalone storage solutions."
— Stefano Ratti (01:36)

Rationale for ‘Develop and Flip’ vs. Long-term Asset Ownership (02:09–04:04)

• Pros & Cons:
  • Developing and selling assets enables focus and operational profitability with less capital risk.
  • Owning/operating requires new skillsets, more capital, and ongoing fundraising.
• Financials:
  • Shaberton has been profitable and self-funding since their initial Greenbacker investment (2020).
  • No immediate plans to change, but open to future ownership.

Post-Legislation Market Changes & Asset Flipping (04:04–05:46)

• Market Continuity:
  • Despite legislative uncertainty ("big beautiful bill"), Shaberton saw little project activity slowdown.
  • Active interest from buyers; tax credit eligibility (ITC) remains crucial.

“We haven't seen a lot of changes. There are some, some players on the margins...but I would say I think we see quite a bit of depth. So I think it's still pretty robust as far as assets.”
— Stefano Ratti (05:31)

Resilience and Competitiveness in Community Solar (05:46–08:39)

• Tariffs & Margins:
  • Smaller community solar projects have “more room to play” and can absorb panel cost fluctuations better than utility-scale due to higher $/Watt margins.
  • Volatile equipment costs are less of a threat.
• Electricity Prices:
  • Projects benefit from rising residential rates—unlike long-term PPAs, community solar can capture upside when prices climb.
• Financing Evolution:
  • Initial skepticism over the credit risk of fragmented community offtakers has faded as the diversification benefits have become clear.

“It became much less of a problem later because you realized, well actually I don't have all my eggs in one basket... if the rates are going up, I get the upside too.”
— Stefano Ratti (07:55)

Capital and Financing for Smaller Developers (08:39–10:39)

• Capital Experience:
  • Greenbacker investment (2020) was timely.
  • Since then, largely self-sufficient; no urgent need to raise further development capital.
• Investor Sentiment:
  • Election cycles and policy uncertainty led to investor hesitation.
  • The passing of the “Big Beautiful bill” and treasury guidance in August 2025 brought “a little bit more certainty.”

Legislative Impacts and Energy Storage Prospects (10:39–12:26)

• Policy Calibration:
  • The shifting policy landscape forces constant business recalibration.
• Storage Opportunity:
  • Storage tax credits (more robust/preserved than those for wind/solar) have made Ratti “more bullish” on integrating storage.
  • “Need capacity more than energy”—the logical market evolution is toward adding storage at all scales.

“We need capacity more than we need energy. So certainly battery storage is...the prime solution for that.”
— Stefano Ratti (11:30)

Equipment Procurement & ‘FIAC’ Compliance (12:26–14:04)

• Market Timing:
  • Shaberton’s storage pipeline matures later (2028–2029), so current supply chain constraints may self-resolve.
• Flexible Strategies:
  • Developers might circumvent complex compliance by opting out of the tax credit if equipment prices drop enough.

"You might just forego the tax credits altogether and decide to go for the cheaper option...probably economically you're going to come out more or less in the same place."
— Stefano Ratti (13:29)

Adjusting to Legislation and Executive Orders (14:04–15:58)

• Safe Harboring:
  • Increased focus on safe harboring (e.g., transformers) before cut-off dates to secure tax credits.
• Project Pipeline Review:
  • Pulled back from marginal markets without viable post-ITC economics.
  • Continued aggression in “core” supportive markets like Maryland, where future viability is expected even after tax credits.

State Support for Distributed Generation (15:58–18:50)

• Top Markets:
  • Maryland, Illinois, and Massachusetts lead due to renewable/distributed energy support and proactive policy actions.
  • New Jersey praised for recent momentum.
• States’ Roles Amid Federal Changes:
  • State-level actions (e.g., faster permitting, improved interconnection) can bridge gaps as federal supports wane.
• Optimism Rooted in State Actions:
  • The company’s formation was itself a response to state renewable energy actions during a less favorable federal policy era.

“Frankly, I mean, if you look at the history of Shabbaton...one of the things that actually prompted the birth... was that the states... were so supportive of renewable energy.”
— Stefano Ratti (18:14)

Forward-Looking Cost Structures and Market Efficiency (18:50–24:55)

• Effect of Subsidy Rollbacks:
  • Could pressure less efficient firms out, driving overall sector efficiency.
  • Claims Shaberton’s strong track record: “80% conversion rate” in Maryland, due to upfront diligence and community engagement.
• Construction/Equipment Costs Outlook:
  • Economics 101: decreased incentives should, over time, lower demand, and in turn, input costs (land, installation, equipment).
  • Short-term: EPC costs might rise due to "rush" to beat safe harbor/ITC deadlines.
  • Post-2027: Expected cost normalization or decline.

"If you take those incentives away, right, Then some of those costs will readjust as well."
— Stefano Ratti (23:09)

Future Outlook, Storage vs. Utility Scale, and Energy Mix (24:55–30:06)

Utility-scale vs. Distributed Generation

• DG will likely gain relative share; avoids costly/delayed transmission upgrades.
• Utility-scale to continue, but distributed scale offers inherent grid and siting advantages.

Broader Generation Mix (“Solar + Storage” vs. Nuclear & Gas)

• Ratti is skeptical of rapid nuclear or gas buildout due to long lead-times.
• Predicts solar and storage will maintain momentum, citing learning-curve and cost-down experience in “solar versus CSP” analogy.
• Gas and nuclear will grow, but “solar storage is going to be the main solution” for at least the next several years.

“My guess is that it's going to be solar power. Storage is going to be the main solution… There’ll be more gas than today and there will be some nuclear too. But I think it will be limited.”
— Stefano Ratti (29:42)

Notable Quotes & Memorable Moments

• On model focus:

  “We wanted to be focused and wanted to do what we do well and really, really knock it out of the park in that, in that niche.” (03:01)

• On state resilience:

  “I'm always maybe half full, the glass half full kind of guy, but I think, definitely, I think that we see...support from some states.” (18:41)

• On risk and optimism:

  “Well, you better be an optimistic guy if you're a developer. I don't think I've ever met a developer who was not optimistic.” — Todd Alexander (18:50)

Timeline & Timestamps

| Topic | Timestamp | |----------------------------------------------------|---------------| | Introduction & business model | 00:30 | | Rationale for flipping vs. owning projects | 02:09 | | Market changes post-legislation/asset flipping | 04:04 | | Tariffs & community solar resilience | 05:46 | | Financing and developer capital markets | 08:39 | | Impacts of legislation & storage outlook | 10:39 | | Equipment procurement & FIAC compliance | 12:26 | | Adjustments to legislation/executive orders | 14:04 | | State policy support | 15:58 | | Project cost/profitability pressure | 18:50 | | Construction/supply chain cost evolution | 22:05 | | Predictions for DG, storage, and power mix | 24:55 | | Comparison: solar/storage vs. nuclear/gas | 27:36 | | Concluding thoughts | 30:06 |

Conclusion

Stefano Ratti’s conversation with Todd Alexander offers a ground-level view of how innovative community solar and storage developers are navigating turbulent markets, evolving policy frameworks, and persistent financing challenges. Despite headwinds, the outlook remains optimistic for distributed energy—especially where state support is robust, project efficiency is paramount, and storage technologies continue to mature.