By: Victor Rojas, Senior Manager, Financial Policy
While 2014 is only just getting underway, it is already shaping up to be a banner year for clean energy finance. Capital investments are being made, funds developed, and securitization tools crafted — all with remarkable speed. And private capital markets are aggressively rallying around these efforts, which will only increase the momentum of our collective efforts to drive investments into essential energy efficiency and renewable energy projects.
Funding for homeowner energy efficiency loans could lead to securitization
Early this year, clean energy consumer finance company, Kilowatt Financial, closed a $100 million deal with Citi to finance 10-12 year unsecured loans of up to $30,000 for homeowners making energy efficiency improvements to their HVAC (heating, ventilation, and air conditioning) systems, water heaters, windows, roofing, insulation, lighting, and appliances.
The transaction is designed to facilitate a securitization of loans (which promotes liquidity in the marketplace), help establish a secondary market, and spur energy efficiency investments. Kilowatt and Citi expect to create term asset-backed securities from the loans that will provide a sustainable source of capital for homeowners looking to make home energy upgrades. Read More