In its first deal of the year, New York State Energy Research Development Authority is preparing to sell $59.7 million in notes, its biggest deal since October 2020.
Backed by solar and energy efficiency loans extended to homeowners, the series 2025A has the largest pool balance, and the largest number of loans, since the NYSERDA 2020A came to market in October 2020. The transaction will issue about 10 classes of notes, composed of one term bond and nine serial bonds. They are all legal final maturity dates ranging from April 1, 2026 through April 1, 2040, according to Kroll Bond Rating Agency.
Bank of New York Mellon is on the deal as trustee, registrar and paying agent, KBRA says.
NYSERDA 2025A includes a prefunding period, lasting until July 31, 2025, which will fund about $47 million of the $111.3 million total collateral pool, KBRA said. The notes benefit from initial credit enhancements representing 47.39% of the pool balance.
KBRA assigned an A rating to all classes of notes, the rating agency said.
Energy Finance Solutions originated the loans, which will find the purchase and installation of solar systems, energy efficiency improvements, air source heat pumps and ground source heat pumps. Meanwhile, a list of participating utilities are subservicers for the on-bill recovery loans. Those utilities include Central Hudson Gas and Electric, Consolidated Edison Co., Long Island Power Authority and New York State Electric and Gas, among others.
On average, the loans have a balance of $12,826, with a weighted average (WA) coupon of 3.82%. Further, the loans have a WA FICO score of 766, with remaining terms of 176 payments, KBRA said.
Carmel Solutions is on the deal as backup servicer, the rating agency said.
The deal structure includes an excess cash revenue fund, which will receive monthly deposits. Its funds will be used to pay down the serial bonds semi-annually on their respective maturity dates until they are paid in full.
