Solar risk management firm kWh Analytics structured a Solar Revenue Put as part of the refinancing of the 173-MWdc Cal Flats 130 PV facility in Monterey County, Calif. The facility is owned and operated by Capital Dynamics, an independent global private asset management firm.
The Solar Revenue Put is a credit enhancement that guarantees up to 95% of a solar project’s expected energy output, structured as an insurance policy on solar production and revenues.
As an ‘all-risk’ policy, the Solar Revenue Put protects against shortfalls in irradiance, panel failure, inverter failure, snow, and other system design flaws. Using its proprietary actuarial model and risk management software HelioStats, kWh Analytics developed the Solar Revenue Put to drive down investment risk and encourage development of clean, low cost solar energy for the Cal Flats facility.
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Swiss Re Corporate Solutions, a subsidiary of Swiss Re, the world’s largest reinsurer, is providing capacity for the Solar Revenue Put. This is the first syndicated refinancing utilizing the Solar Revenue Put.
“As a leading renewable energy financier and customer-focused institution, we’re pleased to continue our support of Capital Dynamics as they deploy innovative renewable energy solutions for communities in the U.S.,” said Alain Halimi, Director of Natural Resources & Energy at Commonwealth Bank of Australia. “Capital Dynamics is one of the largest solar developers in the U.S.; the strong collaboration between Capital Dynamics, CBA, and Rabobank, and the expertise of kWh Analytics, enabled us to deliver a groundbreaking financing for Capital Dynamics and the market.”
Across the industry, portfolios supported by the Solar Revenue Put are securing debt sizing increases of 10% on average. The Solar Revenue Put has been structured on over $1 billion of solar assets, and a survey of the solar industry’s most active lenders indicates that more than 50% of active lenders value the Solar Revenue Put as a credit enhancement. The Solar Revenue Put has now been incorporated into both new build financing and refinancing of all types of solar projects, including utility scale, residential, community solar, and commercial and industrial.
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