With the prices of fossil fuels rising and recently imposed “green” mandates to improve energy efficiency, commercial, institutional and industrial companies are actively looking for alternative energy solutions to reduce energy costs and become more energy efficient. Given that there are over 5.3 million commercial and industrial buildings in the U.S., and that approximately 44% of energy consumption by commercial buildings is for space heating and hot water, developing a viable solar thermal energy system for commercial, institutional and industrial applications represents a significant opportunity.
Unfortunately, when evaluating solar thermal energy systems, many commercial, institutional and industrial applications could not 1.) achieve the high temperatures needed to replace traditional fossil fuel energy sources or 2.) achieve the efficiency needed to make the adoption of a solar thermal energy system financially viable.
The patent pending SunQuest 250® by Solar America Solutions (SAS) changes all of that. Rather than generate electricity like many solar panels, the SunQuest 250® solar collectors generate thermal energy from the sun's UV rays that is used to heat water and provide space heating. Up to 3x more efficient than competitors, it has shown to reduce traditional fossil fuel energy usage for hot water and space heating by 30% to 70%. The large amount of thermal energy produced and the efficiency of SAS's solar panels make them an ideal solution for commercial and institutional buildings and industrial processes.
SAS has solar collectors installed at over 50 customer locations, including the University of Indianapolis and the Indiana State Wabash Valley Correctional Facility. It has a strong pipeline of customers that includes correctional facilities, state government buildings, large hotels, commercial greenhouses, university dormitories, and car wash franchises.
Financial Summary
Previous Fundraise Summary
| Security Type | Revenue Share | |
|---|---|---|
| Investor Eligibility | All Investors | |
| Minimum Investment | $1,000 | |
| Payback Multiple | 1.5x | |
| Payment Frequency | Quarterly | |
| Disbursement Late Fees | 5.00% | |
| Loan Collateral | Unsecured | |
| Seniority | Junior | |
| Equivalent Interest Rate (/yr) | 30.20% | |
| Maturity | June 1, 2021 |
Offering Materials
Team
About Solar America Solutions
Company Updates
State of the Business Update - Q3 2021
October 7, 2021
Thermal Resource Technologies Inc.
State of the Business Report
Third Quarter 2021
As the Covid issues that have plagued progress in the decarbonization movement outlined in the Science Based Target initiative (SBTi), https://sciencebasedtargets.org/, continues to decline, we continue to focus on opportunities to be the solution for the most direct, definable, and easily observed category, Scope 1 – direct emissions created by fuel burn onsite, be that natural gas, propane or fuel oil.
SBTi guidelines and emissions reduction goals have been adopted by over 1,000 companies, and we have begun the process of collaborating directly with players like JBS USA, Charles River Laboratories, PepsiCo and Black & Decker where our US Patented SunQuest 250™ solar thermal systems will make a real and measureable difference.
While the recent Covid variant wave has slowed its progress and we have seen the approval of several of our projects, many of our pipeline prospects remain the same in Q3 but should begin to see movement in Q4. Updated status reports and a couple of new notable opportunities follow:
Stanley Black & Decker: Over the past year and a half we have been developing a working relationship with a local renewable energy consulting group, Greenwave Holdings. https://www.greenwave-holdings.com/. We have taken the time to create relationships with their principals and boots-on-the-ground personnel and we have become their solar thermal “go to” resource and our efforts are starting to pay off. They have been selected as the carbon reduction team by Stanley Black & Decker, tasked with reducing their operational carbon emissions 100% by 2030. Greenwave personnel are currently at the SB&D manufacturing facility in Delhi, Iowa assessing solar thermal opportunities we will begin site evaluation in mid-October. This is the first evaluation of 269 potential manufacturing facilities for boiler preheat/reheat, snow melt, radiant floor and overhead warehouse hydronic heating. At this point we are not sure how many heating applications will be available but we will continue to report on this developing opportunity as it unfolds.
Indiana Department of Correction: One of our long-time customers and supporters, Indiana Department of Correction (IDOC) is building a new state prison. We were notified about this new opportunity by Kevin Orme, the Executive Director of Construction Services the first week of October and will be meeting with him mid-October for an initial project discussion. This will be the 4th Indiana State Prison utilizing our technology. The number of panels is yet to be determined.
PepsiCo: Gatorade pasteurization process/washdown…Oakland, CA – 260 panels. Corporate SBTi carbon reduction mandates are in place to dramatically cut their natural gas burn by 2025. PepsiCo’s Toronto-based engineering group presented their 2022 “Kick Off” presentation to the corporate hierarchy the week of September 27th, and we expect a purchase order sometime late Q4 of this year. 260 to 540 panels…depending on the engineers’ sourcing an adequate heat storage medium to store thermal energy for overnight use. We continue our bi-weekly conference calls with the PepsiCo engineering contractors as we put together the Oakland system, replacing the Indianapolis plant as the first in line because of the more sizable renewable incentives in California. We expect this to be the first of many more installations to come.
Amazon: While the new “Last Mile” Delivery Center in Hagerstown, MD sized for a 77,702 square foot radiant floor application and submitted directly to Amazon’s architectural/engineering group for 110 panels plus three boilers in radiant floor configuration, we have also submitted a budgetary proposal for a 250 panel installation for an AMZL delivery center in a location yet to be determined. This is a terrific opportunity for us that will take some time as both projects are slated to begin later in 2022.
JBS USA: JBS, the largest meat producer in the world – produces 25% of all available beef in the USA. Our first project with this huge meat packing company is a “Pilgrim’s Pride” poultry processing plant in Guntersville, AL and it is projected to incorporate 110 of our panels. We have been working with JBS’s Director of Energy, USA. He and his staff and are in the process of final approval with the onsite Guntersville facility engineering staff. They have told us the first installation will go through a rigorous vetting process with future locations and approvals to go much more quickly. We have preliminarily sized and estimated a second installation in Booneville, KY at 100 panels. He loves our product and what we can do for their SBTi Scope 1 emissions reduction efforts. We are looking for the first purchase order sometime late Q4 of this year.
Toyota America: New pilot project in Long Beach, CA. As Toyota moves to comply with their committed SBTi carbon reduction goals, the 3 Toyota America executives were scheduled to visit our Indianapolis headquarters but had to postpone as one of them received a positive Covid test. We are in the process of getting the visit rescheduled. This effort involves a pilot project at Toyota’s Long Beach, CA facility, and their visit may run over into Q1 of 2022. We have not yet received information to project a budgetary panel count or project cost, but , since they called us to request a meeting at our Indianapolis headquarters – we expect to receive specifics in Q4.
Charles River Laboratories: This Wilmington, MA based pharmaceutical research company provides research and testing of 85% of all new pharmaceuticals in the USA (20 domestic, 40 foreign locations). They have an SBTi Greenhouse Gas Reduction (HGH) deadline, and we are in the process of scheduling an onsite engineering visit. Specific application and panel count are not known yet, but they called us…and this corporation is HUGE. https://www.criver.com/.
Dartmouth College: This project is being introduced through one of our most active dealers, Solar UV Solutions and is projected to require 50 of our collectors. The project is in its approval process – Purchase Oorder and payment info to follow. https://www.sustainability.dartmouth.edu/initia....
Salinas Valley (CA) Biogas: We are working with Machado Construction of Turlock, CA. This will be a hot water / storage tank application with a bio-digestor. Project funding has been pushed back to Q1, 2022 and will need 150 of our collectors.
The Wisconsin Center / Milwaukee: Again, through Solar UV Solutions. This project involves new construction, adding on to the main conference / convention center in Milwaukee. It will require 80 of our collectors. We are waiting on client approval.
New Land Enterprises / Milwaukee: Through Solar UV Solutions again. Apartment / condo developers with two domestic hot water projects (Ascent Apartments), an existing structure, 80 panels. In addition, Nova Apartments, aslo soon to be under construction, will require 80 collectors.
Indiana University (IU) Heath / Arnett Hospital, Lafayette, IN: Quotes are under consideration for their first pilot project – DHW. We met with and presented final numbers to Dirk Hepworth, Maintenance Manager over this and two additional IU Health locations on Thursday, September 23rd. Our proposal for this first project met with final approval on October 7th and represents our opening into the IU hospital system, orchestrated by Rock Kaiser of Sustainable Steam & Water Solutions. https://iuhealth.org/find-locations/iu-health-a.... This initial project is expected to be a 5 panel installation.
International Sales: Through Solar UV Solutions International (SUVI) is collaborating with two new partners who have vast international energy experience and contacts and they are coming onboard as another Solar America Solutions reseller to manage foreign/non-domestic sales and applications. They are developing self-contained 10 panel hot water modules in converted steel shipping containers. While the modules are in development, SUVI is continuing their sales and marketing initiatives through existing contacts and upcoming trade shows in San Antonio, TX and San Juan, Puerto Rico. SUVI has further increased a potential reach through a mutual marketing agreement with an Ohio-based PV (photovoltaic) solar panel manufacturer, opening a new facility in Ohio in Q1 2022. Additional international opportunities, beginning with hotel / hospitality prospects, are currently developing in Central and South America.
Hale Industries: Indianapolis area manufacturer of radiant heat systems and the original “Big Ass Fans”. Hale has approached us about representing our solar thermal systems through their nationwide sales rep network, working with architectural and engineering firms. We are scheduled for a Q&A session with the Hale sales and marketing staff on Monday, October 11th to begin the process of bringing them up to speed on our product and processes and developing marketing strategies. Hale will want to “”private-label” our collectors and has adequate warehouse space to store the product and, upon completing a distribution deal with us, they intend to purchase inventory by the 40 ft. shipping container (180 collectors). They are approaching their busy season and we expect a late Q1or early Q2 2022 start on sales.
There are several other prospects in the mix as companies continue to search for ways to meet their SBTi corporate carbon reduction goals. We are in a great position to capitalize on the overall lack of solutions to curb natural gas usage. This, plus natural gas bulk prices have increased by 94% between January 2020 and June 2021 (169% in September 2021 alone), and that means ROIs will be even better.
Developing government and corporate Greenhouse Gas and carbon reduction mandates are opening a growing number of opportunities for our zero carbon emissions heating solutions and we are encouraged that our systems will be seen as a clear and evident answer to this growing need.
Discussion
It seems like your pricing strategy is based on an anchoring bias, possibly to counteract it in potential clients. My read on your pricing strategy is that you have a Lexus quality product, but you are charging Toyota prices. You have a superior product, you have an order pipeline, you are charging an inferior price. Why not charge a fair price where people are still motivated to choose your product? For example, if your competitor charges $1,400 and produces 1400Energy in gains, you charge $1,400 and produce 2800Energy in gains. Why not charge $2,100 for your product?
How many of your customers rely on government grants, credits, or subsidies to overcome the higher initial selling price of your product to realize cost savings? What percentage of total installation costs does the government cover for your customers on average?
What are the implications for your business if natural gas prices stay below $4.50 MMbtu? What is the company doing to mitigate this risk? How have low natural gas prices impacted your business since it was started?
Company Updates
State of the Business Update - Q3 2021
October 7, 2021
Thermal Resource Technologies Inc.
State of the Business Report
Third Quarter 2021
As the Covid issues that have plagued progress in the decarbonization movement outlined in the Science Based Target initiative (SBTi), https://sciencebasedtargets.org/, continues to decline, we continue to focus on opportunities to be the solution for the most direct, definable, and easily observed category, Scope 1 – direct emissions created by fuel burn onsite, be that natural gas, propane or fuel oil.
SBTi guidelines and emissions reduction goals have been adopted by over 1,000 companies, and we have begun the process of collaborating directly with players like JBS USA, Charles River Laboratories, PepsiCo and Black & Decker where our US Patented SunQuest 250™ solar thermal systems will make a real and measureable difference.
While the recent Covid variant wave has slowed its progress and we have seen the approval of several of our projects, many of our pipeline prospects remain the same in Q3 but should begin to see movement in Q4. Updated status reports and a couple of new notable opportunities follow:
Stanley Black & Decker: Over the past year and a half we have been developing a working relationship with a local renewable energy consulting group, Greenwave Holdings. https://www.greenwave-holdings.com/. We have taken the time to create relationships with their principals and boots-on-the-ground personnel and we have become their solar thermal “go to” resource and our efforts are starting to pay off. They have been selected as the carbon reduction team by Stanley Black & Decker, tasked with reducing their operational carbon emissions 100% by 2030. Greenwave personnel are currently at the SB&D manufacturing facility in Delhi, Iowa assessing solar thermal opportunities we will begin site evaluation in mid-October. This is the first evaluation of 269 potential manufacturing facilities for boiler preheat/reheat, snow melt, radiant floor and overhead warehouse hydronic heating. At this point we are not sure how many heating applications will be available but we will continue to report on this developing opportunity as it unfolds.
Indiana Department of Correction: One of our long-time customers and supporters, Indiana Department of Correction (IDOC) is building a new state prison. We were notified about this new opportunity by Kevin Orme, the Executive Director of Construction Services the first week of October and will be meeting with him mid-October for an initial project discussion. This will be the 4th Indiana State Prison utilizing our technology. The number of panels is yet to be determined.
PepsiCo: Gatorade pasteurization process/washdown…Oakland, CA – 260 panels. Corporate SBTi carbon reduction mandates are in place to dramatically cut their natural gas burn by 2025. PepsiCo’s Toronto-based engineering group presented their 2022 “Kick Off” presentation to the corporate hierarchy the week of September 27th, and we expect a purchase order sometime late Q4 of this year. 260 to 540 panels…depending on the engineers’ sourcing an adequate heat storage medium to store thermal energy for overnight use. We continue our bi-weekly conference calls with the PepsiCo engineering contractors as we put together the Oakland system, replacing the Indianapolis plant as the first in line because of the more sizable renewable incentives in California. We expect this to be the first of many more installations to come.
Amazon: While the new “Last Mile” Delivery Center in Hagerstown, MD sized for a 77,702 square foot radiant floor application and submitted directly to Amazon’s architectural/engineering group for 110 panels plus three boilers in radiant floor configuration, we have also submitted a budgetary proposal for a 250 panel installation for an AMZL delivery center in a location yet to be determined. This is a terrific opportunity for us that will take some time as both projects are slated to begin later in 2022.
JBS USA: JBS, the largest meat producer in the world – produces 25% of all available beef in the USA. Our first project with this huge meat packing company is a “Pilgrim’s Pride” poultry processing plant in Guntersville, AL and it is projected to incorporate 110 of our panels. We have been working with JBS’s Director of Energy, USA. He and his staff and are in the process of final approval with the onsite Guntersville facility engineering staff. They have told us the first installation will go through a rigorous vetting process with future locations and approvals to go much more quickly. We have preliminarily sized and estimated a second installation in Booneville, KY at 100 panels. He loves our product and what we can do for their SBTi Scope 1 emissions reduction efforts. We are looking for the first purchase order sometime late Q4 of this year.
Toyota America: New pilot project in Long Beach, CA. As Toyota moves to comply with their committed SBTi carbon reduction goals, the 3 Toyota America executives were scheduled to visit our Indianapolis headquarters but had to postpone as one of them received a positive Covid test. We are in the process of getting the visit rescheduled. This effort involves a pilot project at Toyota’s Long Beach, CA facility, and their visit may run over into Q1 of 2022. We have not yet received information to project a budgetary panel count or project cost, but , since they called us to request a meeting at our Indianapolis headquarters – we expect to receive specifics in Q4.
Charles River Laboratories: This Wilmington, MA based pharmaceutical research company provides research and testing of 85% of all new pharmaceuticals in the USA (20 domestic, 40 foreign locations). They have an SBTi Greenhouse Gas Reduction (HGH) deadline, and we are in the process of scheduling an onsite engineering visit. Specific application and panel count are not known yet, but they called us…and this corporation is HUGE. https://www.criver.com/.
Dartmouth College: This project is being introduced through one of our most active dealers, Solar UV Solutions and is projected to require 50 of our collectors. The project is in its approval process – Purchase Oorder and payment info to follow. https://www.sustainability.dartmouth.edu/initia....
Salinas Valley (CA) Biogas: We are working with Machado Construction of Turlock, CA. This will be a hot water / storage tank application with a bio-digestor. Project funding has been pushed back to Q1, 2022 and will need 150 of our collectors.
The Wisconsin Center / Milwaukee: Again, through Solar UV Solutions. This project involves new construction, adding on to the main conference / convention center in Milwaukee. It will require 80 of our collectors. We are waiting on client approval.
New Land Enterprises / Milwaukee: Through Solar UV Solutions again. Apartment / condo developers with two domestic hot water projects (Ascent Apartments), an existing structure, 80 panels. In addition, Nova Apartments, aslo soon to be under construction, will require 80 collectors.
Indiana University (IU) Heath / Arnett Hospital, Lafayette, IN: Quotes are under consideration for their first pilot project – DHW. We met with and presented final numbers to Dirk Hepworth, Maintenance Manager over this and two additional IU Health locations on Thursday, September 23rd. Our proposal for this first project met with final approval on October 7th and represents our opening into the IU hospital system, orchestrated by Rock Kaiser of Sustainable Steam & Water Solutions. https://iuhealth.org/find-locations/iu-health-a.... This initial project is expected to be a 5 panel installation.
International Sales: Through Solar UV Solutions International (SUVI) is collaborating with two new partners who have vast international energy experience and contacts and they are coming onboard as another Solar America Solutions reseller to manage foreign/non-domestic sales and applications. They are developing self-contained 10 panel hot water modules in converted steel shipping containers. While the modules are in development, SUVI is continuing their sales and marketing initiatives through existing contacts and upcoming trade shows in San Antonio, TX and San Juan, Puerto Rico. SUVI has further increased a potential reach through a mutual marketing agreement with an Ohio-based PV (photovoltaic) solar panel manufacturer, opening a new facility in Ohio in Q1 2022. Additional international opportunities, beginning with hotel / hospitality prospects, are currently developing in Central and South America.
Hale Industries: Indianapolis area manufacturer of radiant heat systems and the original “Big Ass Fans”. Hale has approached us about representing our solar thermal systems through their nationwide sales rep network, working with architectural and engineering firms. We are scheduled for a Q&A session with the Hale sales and marketing staff on Monday, October 11th to begin the process of bringing them up to speed on our product and processes and developing marketing strategies. Hale will want to “”private-label” our collectors and has adequate warehouse space to store the product and, upon completing a distribution deal with us, they intend to purchase inventory by the 40 ft. shipping container (180 collectors). They are approaching their busy season and we expect a late Q1or early Q2 2022 start on sales.
There are several other prospects in the mix as companies continue to search for ways to meet their SBTi corporate carbon reduction goals. We are in a great position to capitalize on the overall lack of solutions to curb natural gas usage. This, plus natural gas bulk prices have increased by 94% between January 2020 and June 2021 (169% in September 2021 alone), and that means ROIs will be even better.
Developing government and corporate Greenhouse Gas and carbon reduction mandates are opening a growing number of opportunities for our zero carbon emissions heating solutions and we are encouraged that our systems will be seen as a clear and evident answer to this growing need.
Discussion
OK, how about this wrinkle... You maintain prices for the first order from an institution, but then make it known that their prices will go up for subsequent orders when the technology is proven? If they know they will payback the upfront cost within 5 years, then 6 years is still a great payback period...?
It seems like your pricing strategy is based on an anchoring bias, possibly to counteract it in potential clients. My read on your pricing strategy is that you have a Lexus quality product, but you are charging Toyota prices. You have a superior product, you have an order pipeline, you are charging an inferior price. Why not charge a fair price where people are still motivated to choose your product? For example, if your competitor charges $1,400 and produces 1400Energy in gains, you charge $1,400 and produce 2800Energy in gains. Why not charge $2,100 for your product?
How many of your customers rely on government grants, credits, or subsidies to overcome the higher initial selling price of your product to realize cost savings? What percentage of total installation costs does the government cover for your customers on average?
What are the implications for your business if natural gas prices stay below $4.50 MMbtu? What is the company doing to mitigate this risk? How have low natural gas prices impacted your business since it was started?
OK, how about this wrinkle... You maintain prices for the first order from an institution, but then make it known that their prices will go up for subsequent orders when the technology is proven? If they know they will payback the upfront cost within 5 years, then 6 years is still a great payback period...?