Introduction & Background
Benoy Thanjan โ Host, Solar Maverick Podcast
Hi. My name is Benoy Thanjan, and I'm host of the Solar Maverick podcast. Thank you to Suncast for setting this up at InterSolar and Nico Johnson for his thought leadership in the solar industry. I can't believe he's done nine hundred episodes of Suncast, and him and I actually collaborate on bringing guests.
Benoy Thanjan
If you don't know about the Solar Maverick podcast, it's about solar and entrepreneurship. I started the podcast seven years ago. We provide weekly content and have published two hundred and sixty-two episodes โ you can find it on all your major platforms, YouTube, Spotify.
Benoy Thanjan
I'm really excited to have Kimberlee Centera. She's the CEO and founder of TerraPro Solutions, and she's a native โ are you native San Diego or close to native?
Kimberlee Centera โ CEO & President, TerraPro Solutions
Native Californian pretty much, but yeah, almost native San Diego. I've been here a long time.
Benoy Thanjan
We're excited that InterSolar is now in its second year here in San Diego at the beautiful San Diego Convention Center. Kim, if our audience is not familiar with the content and thought leadership that you come out with, can you talk about yourself and the company, TerraPro?
Kimberlee Centera
Yeah. Happy to. Thank you, Benoit, and hi, everyone. Really excited to be here, and this conference is really growing.
Kimberlee Centera
I've been around the renewable space for a very long time. One of the first projects I looked at in California was a project developed up in Altamont where at that time, the tax credits attached to the individual turbines โ every single turbine in that project was individually owned along with the transmission and the access. My job was to terminate all those rights so the project could be repowered. So that was my beginning. It was a long time ago.
Kimberlee Centera
I started in wind and progressed into solar, was very fortunate in 2012 to start TerraPro Solutions and really bring to bear all of my experience and background to be able to work in the development space โ really help developers understand all the things that I knew, all the best practices that I've spent years putting together. So excited to be able to share that.
Benoy Thanjan
Can you talk about some representative engagements and who your typical clients are before we get into the discussion?
Kimberlee Centera
Most of our clients are international power companies that want to develop renewable projects in the United States. They're generally in the large utility-scale space โ it used to be fifty megawatts, but of course it's much higher than that because we want to capture as many economies as we can. We're working on wind, solar, storage, data centers, pretty much everything.
Kimberlee Centera
We are really focused on the finance piece because all my years of working in finance, that's really been my area of specialty. I'm sitting at the table, and I know the things that the developers just don't know or forget to ask. We want to make sure that they understand those items and can ask questions and be prepared for the financings.
Risk #1: Site Control vs. Perfected Site Control
Benoy Thanjan
Can you talk about the main three risks that hinder closing on a utility-scale project?
Kimberlee Centera
One of the things that we're seeing is deal acceleration. The banks and investors โ the money is on the sidelines. They want the deals to move forward, but the deals that are moving forward are the ones where they've done a really good review of due diligence. The investors want to see that derisking happen early. They don't want to be sitting at the deal table and have things show up on a checklist.
Kimberlee Centera
The basis for projects is the land โ that's really where it starts. And there's a big difference between site control and perfected site control. If you're sitting at the deal table and the land that you're representing doesn't match the land that the lenders' attorneys or the investors' attorneys are looking at, you're going to have issues right out of the gate.
Benoy Thanjan
Exclusivity is usually thirty to ninety days. What's the fastest way to make sure that you really have the land that is said in the documents?
Kimberlee Centera
With that short of a time frame, you really have to be prepared to front-load your critical issues. You've got to be able to really identify those issues and be looking at those. And sometimes you've got the expertise on maybe your M&A team โ you might have to tap into your development team, tap into resources.
Kimberlee Centera
When you have somebody coming in and they're bringing you a project, you have to remember that you've got to verify everything that they're representing. A lot of times the folks that are bringing these projects forward may not have the expertise and the knowledge, and we see that happen a lot. So collaboration is important and really front-loading those critical issues.
Risk #2: Mineral Rights Complexity
Kimberlee Centera
The other thing that people frequently underestimate is the complexity of minerals and mineral rights. And depending upon where you are, it can be extremely complex and difficult.
Kimberlee Centera
A mineral severance happens when there's some kind of a deed grant or a deed reservation โ it becomes a whole different chain of title. It has to be researched separately. Title companies don't do it. It poses a big risk to your project.
Kimberlee Centera
We have a project right now that we've been working on drill sites for probably about fourteen months, going back and forth between the operator of the drill sites and the operator of the minerals. The title company, the county is even claiming some jurisdiction over the approval of those drill sites. That's kind of extraordinary, but those are the things that we have to be prepared for.
Risk #3: Title Defects & Unbankable Projects
Benoy Thanjan
From an investor or tax equity perspective, what real estate or title issues often make projects unbankable?
Kimberlee Centera
Sometimes it's really simple things, and it seems like it should be intuitive. Things aren't recorded, or they're recorded without correct legal descriptions, or they miss somebody on title. It happens a lot.
Kimberlee Centera
The investor is always looking at it from the perspective of: if something happens to the developer or the sponsor and they're out of the deal, what rights do they have to be able to exercise and complete the project or protect their interest? They need to be able to take a first priority lien in all those assets. They want a title insurance policy.
Kimberlee Centera
We had a case where we had a single landowner sign, and she passed away the next day. We recorded, and then through her estate, all of a sudden, had thirteen owners on that property. Every time we went out for signatures after that, we had to get thirteen landowners to sign. When you're dealing with title insurance and investors, banks, title companies, you can't have twelve out of thirteen. You have to have every single person's notarized signature on a document in order for it to be valid.
Local Ordinances & Environmental Constraints
Kimberlee Centera
I always recommend checking in even with the constituency. What is the receptivity for the project? Because in some cases, if you're building a data center right now, it can be very difficult. You may really hit some hurdles. We've got some cases where the county is exercising some extraordinary jurisdiction over our projects, and getting permits is tough right now. So anything that you can control, that you can move to the front and make sure that you understand, is going to help you be more prepared.
Kimberlee Centera
We have projects that have really been impacted by, in one case, health protection zones โ a huge perimeter that they put around the boundaries that said there could be no development within those areas. If you've acquired land, you're running your pro forma on the basis of a certain amount of acreage, you figure you can put in so many panels, so many turbines โ that can really be impacted. You might need more land than you think you have, which is going to affect your timing.
Kimberlee Centera
Are you on federal lands right now? Because federal land right now can be very difficult to develop on. We have some clients that are just backloading any projects that touch federal land. And then you might have some impacts depending upon wetlands and other things where you're going to have those state agencies or other agencies come in. So it really pays to work with your ALTA surveyors and the other people that are helping you due diligence and identify: is there wetlands? What kind of environmental issues do we have? What kinds of ordinances are being passed?
AI in Due Diligence
Benoy Thanjan
How do you see AI automation changing due diligence and risk analysis in renewable project acquisition?
Kimberlee Centera
You have to have that expertise, that human element running in parallel with the AI. I think where I've heard it used is maybe in very early stage โ maybe you're running kind of a quick analysis that you're going to fact-verify. A lot of this is still being developed. We're looking at it really closely. We obviously want to respond to our clients and be able to incorporate it. However, I have to make sure that we have a high level of expertise on our team, and I can't turn it over to AI unless and until we can really confidently replicate that. So I think it's a cautious integration is what I would say.
Kimberlee Centera
In our world, if we're on the East Coast or in the South, we are looking at deeds that were written in handwriting back in the 1800s. And so if you're reading that deed and you don't read a "junior" or a "senior" and maybe you don't differentiate between those two โ those are different people. When you're talking about that kind of review and due diligence, we want to make sure it has to be really pristine.
Industry Trends
Kimberlee Centera
What I've heard at recent conferences is there are many hundreds of projects that have been safe-harbored. So there's a lot of projects out there. We saw a kind of a pickup, but then a slowdown. What I think I see now is that people are resolute. This industry is full of people with resolve. We know how to be resilient. We know how to pivot. We know how to make things work.
Kimberlee Centera
When you sit down at the table with a lender and you're transparent about where the hair is on the project โ and you have a plan for it โ you're going to garner a lot more credibility and trust. And you'll have a much better likelihood of the project going forward.
On Entrepreneurship
Benoy Thanjan
You started TerraPro Solutions in 2012. What advice would you give to anyone looking to start their own business in the energy space?
Kimberlee Centera
I have a female-owned business. I employ mostly women โ not because it's a political statement or anything, just because they were always the smart people in the room.
Kimberlee Centera
I think you have to be willing to always pivot. Flexibility is key. We made it through COVID without laying anyone off, which was phenomenal, and that was my goal โ I did not want to lose any of my people. And I think where we are today, if you're going to have a business, you've just got to keep showing up. Because it's the hard decisions and not the easy ones that are going to determine your future. So you have to be willing to make the hard decisions and keep showing up, and that's what I've always done.
This transcript has been lightly edited for clarity. The full audio and video is available on Suncast Media and via the embed on the podcast feature post.