SolarTech and CalCEF announced the creation of a working group to bring best practice leaders together to foster renewable energy financing, including securitization.
“The securitization of solar assets will unleash one of the most powerful forces in finance, establishing an enormous new pool of capital to support the industry's growth,” said Dan Adler, president of CalCEF. “With SolarTech, our goal is to identify and promote industry standards for establishing solar as an asset class, in order to increase the investor base and create ownership opportunities for broad new categories of investors.”
The new group hopes to accelerate industry efforts to increase investor confidence, decreasing project risk, and improving the flow of capital to the sector.
Both organizations want to foster collaboration and education among private equity, financial institutions, renewable energy project finance sources, project developers, and other stakeholders wanting the faster deployment of distributed energy projects via quicker capital formation in the small/medium commercial market sector.
The organizations will form a technical working group to identify market gaps in the quantification of project risk, capital formation, and bankability.
These steps will lead to model guidelines for key stakeholders in project finance, capital markets, design/engineering, and installation that drive standardization of best in class solutions for increasing liquidity in aggregate for PV project portfolios.
They will expand on existing collaborative work with Sandia National Laboratories on ways to make the commercialization of new technologies faster by validating system performance and reliability.
The working group will also propose solutions to limit the gaps between perceived and real project risk across the project delivery chain. In 2012, both firms will engage with regional banks and supporting financial institutions to crystalize the creation of solar as an asset class.
“Standardization of key project attributes – including contracts, proposals and credit metrics – is vital to ensuring access to broader pools of capital for renewables as an asset class," said Paul Deterring, director of SolarTech and CEO of Tioga Energy. "This Working Group provides a forum to establish a unified voice among industry stakeholders and ultimately yield solutions that will accelerate the growth of the commercial solar market.”