Momentum behind U.S. solar leasing companies show no sign of abating, with the latest deal seeing Investec provide a $195 million credit facility to Sunrun. The deal sees Investec assemble a syndicate of lenders to provide $171 million of the credit. Investec says the syndicate includes a number of new lenders to the solar leasing space.
"We have established a cost effective financing solution that leverages long-term cash flows to support the long term growth of Sunrun’s business," said Mike Pantelogianis, Co-Head of Power at Investec.
Reducing the cost of capital for solar leasing firms is one of the key drivers of the sector. Crowdfunding and securitization are two of the more innovative methods that have been applied. Sunrun claims that the credit facility with Investec is being delivered at a sector-wide low interest rate.
"This financing significantly reduces Sunrun’s cost of capital, which will help us lower costs for homeowners and also positions the company well for continued growth," said Jason Cavaliere, VP of Project Finance at Sunrun. "The strength of our project portfolio and operating history, among other factors, allowed us to achieve a lower interest rate and longer tenor than any publicly announced residential solar backleverage facility.
Investec says the credit facility was met with strong interest and was oversubscribed.
On Wednesday, solar lease and loan provider SolarCity announced that it was partnering with J.P. Morgan to create a $350 million fund, to finance its activities.