Solar and energy storage will increasingly be integrated together at commercial sites, homes and microgrids.

But to be honest, they are an odd couple with very different personalities.

Solar is passive: solar modules are typically planted in a fixed position to generate power for 20 or 30 years. You have to hose them off occasionally, but active maintenance and management reimains fairly minimal. Except for the occasional inverter glitch, lifetime energy output is also somewhat predictable.

Storage systems, by contrast, are active, continually discharging and/or charging to arbitrage pricing or balance loads. Maintenance and upgrades are part of the territory: batteries need to be swapped in and out of the system over its lifetime. The software installed with solar systems functions mostly to document power production. The software inside of storage systems functions more like a true operating system, controlling battery activity and monitoring cells for potential failure or degradation.

Most important of all, the function and “value” of a solar system is straightforward: they generate electrons. Unless the sun implodes in the near future, you understand the value of your investment with sterling precision from day one.

 Storage is deployed for demand response, smoothing intermittent renewables, reducing peak charges and frequency regulation. The same system will perform these and more functions, often in the same day. The “value” thus will vary wildly: a system used for frequency regulation will potentially earn far more revenue than one used simply to store electrons from a solar system for nighttime enjoyment. Using storage to capture solar energy for nighttime enjoyment, in fact, seems almost a futile way to use a storage system: you’re deploying a somewhat elegant, intelligent piece of equipment to replace off-peak grid power, the cheapest power you can buy. It’s like buying a BMW to only go back and forth to the convenience store.

As a result, they probably shouldn’t be sold within the same contract. Right now in solar, a growing number of customers are choosing to buy their systems through loan contracts instead of PPAs. The declining cost of solar, along with the established reliability, simply make loans a better option in most cases.

But storage? Consumers simply aren’t in a position to manage and monetize storage in an optimal fashion. Solar you can set and forget: storage you want to constantly massage.

Hence, the LOPPA, which stands for Loan PPA. Under a LOPPA, a solar system is purchased by a loan while the storage system gets installed under a PPA. The beauty is that the two payment vehicles can be combined in the same document, covering up the legal messiness with one monthly payment. The consumer gets the benefit of greater energy independence at a lower price while the solar dealer gets to earn revenue from a sale (the solar loan) a PPA and additional, incremental revenue streams.

One could imagine a wide spectrum of variants. Solar dealers, for instance, could sell a consumer a residential system under a loan and a portion or condominium interest in a community storage system. Larger storage systems can have a better ROI. It is also easier for developers to sell utilities more services through fewer systems.

There’s a good variety of acronyms too: Solo Stoppa, StoSo, etc.

Who offers LOPPA? Right now, I’m not sure. I made up the term. But creative financing has been the hallmark of the U.S. solar industry and storage is on the way. You will see contracts like this. It’s just a matter of time.