Hannon Armstrong Sustainable Infrastructure Capital, Inc. sold a $100 million asset-backed securitization of cash flows from over 100 individual wind, solar and energy efficiency installations, all with investment grade obligors.
The “Sustainable Yield Bonds” were sold with a coupon of 2.79%, according to a company press release. The bonds are structured with a Dec. 2019 maturity date and are backed by over 100 individual installations in over 20 properties.
Jeffrey Eckel, President and CEO of Hannon Armstong said in a press release that the bonds benefit from a “quantitative assessment of the greenhouse gas impact that is measured in metric tons per $1,000 of par value.” The assets underlying the Series 2013-1 bond are “estimated to reduce annual greenhouse gas emissions by 0.61 metric tons per $1,000 bond”.
"While not all 'green bonds' have a direct GHG impact, this rigorous attempt to estimate the GHG impact per bond is a welcome financial tool in the critical task of reducing greenhouse gas emissions," said Sean Kidney, CEO of Climate Bonds Initiative, a not-for-profit working to mobilize capital markets to finance climate change solutions. Investors will get emissions reporting data project by project, although individual projects won’t be named ”for competitive reasons”.
The deal was privately placed but Eckel said in the press release that the plan is to eventually issue publicly rated and traded debt. Hannon Armstrong makes debt and equity investments in sustainable infrastructure projects.