Goldman Sachs facilitating low-interest solar bonds in Japan


Goldman Sachs is helping Japanese solar companies achieve the country’s ambitious renewable energy targets by arranging low priced, A-rated bonds, according to a recent report by Bloomberg.

The U.S. investment group is structuring the bonds renewable energy companies like Tokyo-based solar developer Japan Asia Group Ltd., which operates 27 MW of solar plants in Japan and has developed more than 60 MW of PV power plants in Europe through its subsidiary Geosol Group. JAG has sold about JPY 6 billion ($56 million) of bonds to finance its projects, including two plants on the southern island of Kyushu. The company also has plans for a further 117 MW.

With interest at the 1% level, the bonds are arranged at cheaper rates than the price of similar bank loans and are fulfilling strong demand for long-term bonds with an A rating due to a general lack of corporate and electric utility bonds in the Japanese market, Toshihiro Hiraoka, head of project funding for Japan Asia Group’s JAG Energy Co. subsidiary, tells Bloomberg. Hiraoka says JAG can sell notes with interest at 1% while non-recourse loans carry a rate of 2% to 3%.

The rates are also far lower than the 6.4% average interest on global renewable energy bonds, Bloomberg points out.

Hiraoka says JAG Energy was unable to receive non-recourse loans on a number of projects from Japan’s largest banks without some form of corporate guarantee. JAG now plans to make bond funding the main focus of financing for solar projects, he tells Bloomberg, adding that the group may also consider non-recourse loans if rates become more favorable in the future.

Goldman Sachs' own Japan Renewable Energy Co. affiliate, established in 2012 to develop sun and wind energy plants, is also using project bonds. In August, the company issued JPY 735 million ($6.85 million) of 20-year bonds with an A score from Japan Credit Rating Agency Ltd. to finance a plant located in a region adjacent to Fukushima in northeastern Japan.

Deutsche Bank, meanwhile, announced in July that it planned to lend about $1 billion for solar projects in Japan. In June, the bank approved a JPY 11.1 billion ($103 million) non-recourse loan for a solar installation north of Tokyo to be operated by a division of Spain’s Gestamp Renewables Corp.

Popular content

This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact:


Related content

Elsewhere on pv magazine...

Leave a Reply

Please be mindful of our community standards.

Your email address will not be published. Required fields are marked *

By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.

Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.

You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.

Further information on data privacy can be found in our Data Protection Policy.