Solar City Corp., the first U.S. company to sell bonds backed by
rooftop solar panels, plans to offer similar products to individual
investors. The company says it expects to introduce within six months an online system for retail investors to provide debt for SolarCity’s rooftop power plants.
The system will provide one of the few opportunities for individuals
to back renewable-energy projects, which generate steady revenue from
selling electricity and may be less risky than equities. The arrangement
also provides a new source of funding for San Mateo, California-based
SolarCity, said Chief Executive Officer Lyndon Rive.“The more sources of capital for solar investments, the more
competition and hopefully it will lower financing costs,” Rive said in
an interview. He didn’t provide details on the potential returns for
investors.
The company is following Oakland, California-based Mosaic Inc.
in offering retail investors a share of the revenue stream from
financing solar-power systems. Mosaic was founded in April 2011 and has
facilitated more than $5.6 million in funding.“We expect billions of dollars of investment through this platform,”
Rive said. He declined to provide a more precise amount or time frame.
The company will use the funds to refinance its portfolio of completed
solar projects.
The lending technology was developed by Common Assets LLC, which
SolarCity bought. The company’s two employees have both joined the solar
provider to manage the web-based investment system, according to the
statement.SolarCity installs rooftop solar systems for customers who typically
pay little to nothing up front and sign long-term contracts to buy the
power. The company sold $54.4 million in bonds
on Nov. 13 with a 4.8 percent interest rate, and is planning to offer
as much as $200 million of additional notes. The company needs regular
injections of capital to fund new solar plants.
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