The solar yieldco continues its growth in solar and are now being rolled out in the residential market segment. Today NRG announced that it was spinning of a bundle of residential leases into a new company in partnership with NRG Yield.
15,000 leases will be bundled in the partnership. NRG Yield says that it should deliver CAFD returns of 7.5% over the life of the investment. It is expected to be fully subscribed within 12 months.
The bundled solar products were delivered by subsidiary NRG Home. They include a 2,200 unlevered portfolio across nine sates, worth some 17 MW with an average of 17 years remaining on the lease. An in-development portfolio will form the remaining 48 MW of the yieldco, across 10 states with an average lease term of 20 years. This second portfolio has been tax equity financed.
This strategic financial partnership, coupled with the growing strength of NRG Homes residential solar platform, provides us even more confidence in our strategy and growth targets both for the residential solar business and for the NRG Yield portfolio at large, said NRG CEO David Crane. The executive added that it should deliver a new stage of growth for NRG Yield.
The yieldco, as it does for those established for large PV power plants, is designed to accelerate the return on capital for NRG Home Solar.