SolarMax Technology Signs MOU for 40-Megawatt Solar Farm in Georgia

Rhea-AI Summary

SolarMax Technology (NASDAQ: SMXT) has signed a Memorandum of Understanding with Sunelement Energy for a significant solar project in East Dublin, Georgia. The proposed facility includes a 40-megawatt solar power system combined with a 150 megawatt-hour battery storage system.

As part of the agreement, SolarMax will provide engineering, procurement, and construction (EPC) services, including handling all necessary permits. Sunelement will fund the EPC work and receive applicable federal and state tax benefits. The final terms of the agreement are still subject to negotiation between the parties.

Positive

• Expansion into large-scale utility projects with 40MW solar farm
• Integration of significant 150MWh battery storage component
• No capital investment required as Sunelement will fund the EPC work

Negative

• MOU terms are not finalized and subject to negotiation
• Final agreement and financial terms not yet determined

Insights

Energy Infrastructure Analyst

The proposed 40MW solar farm with 150MWh battery storage represents a significant expansion into utility-scale projects for SolarMax. While MOUs are non-binding, this project's scope indicates strong potential for revenue growth. The battery storage component is particularly strategic, as it's nearly 4x the solar capacity, enabling effective power management and grid stabilization capabilities. Georgia's supportive renewable energy policies and growing demand for clean energy make this a promising market entry. The structure where Sunelement funds the EPC work while receiving tax benefits suggests a well-thought-out financial arrangement that could minimize SolarMax's capital exposure while maintaining revenue potential from construction services. However, investors should note that final terms are yet to be negotiated and project execution timeline remains undefined.

Financial Analyst

For a company with a $79.2M market cap, securing a 40MW solar project represents a material opportunity that could significantly impact revenue. While specific financial terms aren't disclosed, typical utility-scale solar projects of this size can range from $40-60M in total costs. The arrangement where Sunelement handles funding and receives tax benefits while SolarMax provides EPC services appears strategically sound, potentially allowing for revenue recognition without heavy capital commitment. The inclusion of a substantial 150MWh battery system adds considerable value to the project scope. However, as this is just an MOU, investors should temper expectations until a definitive agreement is reached. The project's successful execution could position SolarMax for more utility-scale opportunities and demonstrate scalability beyond their current operations.

RIVERSIDE, Calif., Dec. 12, 2024 (GLOBE NEWSWIRE) -- SolarMax Technology, Inc. (Nasdaq SMXT) (“SolarMax” or the “Company”), an integrated solar energy company, has entered into a Memorandum of Understanding (MOU) with Sunelement Energy Inc., a domestic manufacturer of solar panels (“Sunelement”), for the installation of a solar power and battery project in East Dublin, Georgia.

The proposed project contemplates an electricity grid-connected photovoltaic solar power facility with a total capacity of approximately 40 megawatts, coupled with a battery energy storage system of 150 megawatt-hours. SolarMax is to provide the engineering, procurement, and construction (“EPC”) services in connection with the construction of this project. These services will include all necessary permitting for the construction and operation of the solar power facility. The MOU does not provide any terms for the proposed agreement, which is subject to negotiation between the parties.

David Hsu, CEO of SolarMax, stated, “We are excited to collaborate on this project and contribute to the growing renewable energy sector in Georgia as we look to demonstrate our ability to deliver large-scale solar and energy storage projects that meet the evolving needs of our customers.”

The MOU provides that Sunelement will fund the EPC work and receive any available federal or state tax benefits.

About SolarMax Technology Inc.

SolarMax, based in California and founded in 2008, is a leader within the solar and renewable energy sector focused on making sustainable energy both accessible and affordable. SolarMax has established a strong presence in southern California. SolarMax is looking to generate growth with strategic initiatives that aim to scale commercial solar development services and LED lighting solutions in the US while expanding its residential solar operations. SolarMax’ website is www.solarmaxtech.com.

Any information contained on, or that can be accessed through SolarMax’ website or any other website or any social media is not a part of this press release.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”) as well as Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended, that are intended to be covered by the safe harbor created by those sections. Forward-looking statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as “believe,” “expect,” “may,” “will,” “should,” “would,” “could,” “seek,” “intend,” “plan,” “goal,” “project,” “estimate,” “anticipate,” “strategy,” “future,” “likely” or other comparable terms, although not all forward-looking statements contain these identifying words. All statements other than statements of historical facts included in this press release regarding the Company's strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Important factors that could cause the Company's actual results and financial condition to differ materially from those indicated in the forward-looking statements. Such forward-looking statements are subject to risk and uncertainties, including, but not limited to the ability of SolarMax to enter into a definitive agreement with Sunelement and to price its services at rates that will enable SolarMax to generate a profit from the agreement and those described in “Cautionary Note on Forward-Looking Statements,” “Item 1A. Risk Factors,” and “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on April 16, 2024 and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s report on Form 10-Q for the quarter ended September 30, 2024, which was filed with the SEC on November 14, 2024. SolarMax undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events except as required by law. You should read this press release with the understanding that our actual future results may be materially different from what we expect.

Contact:
For more information, contact:
Stephen Brown, CFO
(951) 300-0711

FAQ

What is the capacity of SolarMax's (SMXT) new solar project in Georgia?

The proposed solar project in East Dublin, Georgia, will have a total capacity of 40 megawatts of solar power and 150 megawatt-hours of battery storage.

Who will fund the EPC work for SMXT's Georgia solar project?

Sunelement Energy will fund the EPC work and receive any available federal or state tax benefits for the project.

What services will SolarMax (SMXT) provide for the Georgia solar farm?

SolarMax will provide engineering, procurement, and construction (EPC) services, including all necessary permitting for the construction and operation of the solar power facility.

Is the SolarMax (SMXT) Georgia solar project agreement finalized?

No, the agreement is currently at the MOU stage and the final terms are still subject to negotiation between SolarMax and Sunelement Energy.