Mosaic, which launched by crowd funding commercial-scale solar projects at schools and community centers is quickly moving into residential solar financing. Yesterday (Oct. 21) the company announced that it partnered with an affiliate of global reinsurer PartnerRe Ltd. on a $100 million new financing facility to support home solar loans.
Mosaic recently expanded its residential solar offerings into new states, according to Bruce Ledesma, Mosaic's chief operating officer. That, he said “resulted in accelerating demand for capital sourcing for our homeowner loans beyond traditional crowdfunding.” Hence the company looked for a partner that could help establish extra financing. ”We are thrilled to work with an experienced investment team to expand the availability of our lending capacity to solar installers and their customers throughout the country."
Through the agreement PartnerRe will finance loans for solar on residential rooftops that Mosaic originates. The loans allow homeowners to go solar with no money up-front, but instead of leasing the solar array, or buying the power from the array through a power-purchase agreement, the homeowners actually own the array and repay the loan.
"Mosaic has successfully created innovative loan products and technology-driven origination processes," said David Moran, President of PartnerRe Principal Finance Inc. "PartnerRe is impressed with the quality of consumer loans in Mosaic's portfolio. We look forward to beginning our financing arrangement and facilitating greater access to capital for the solar market consistent with our investment objectives.”
Insurance companies and institutional investors like PartnerRe are starting to show more interest in investing in solar power. Previously many large funds like this one were financed by banks or other investors through tax-equity funds. However they were looking for quicker returns on investment at higher interest rates. Insurers however, are looking for lower-risk, long-term returns on investment, which means the interest rates they require are usually lower than those for tax-equity funds. What that means for the homeowners is they have a chance to get a solar array at lower costs.
While Mosaic has made large moves into residential solar power with this new announcement, the company will also continue offer peer-to-peer funding or crowdfunding to support solar projects. However at this point not all states allow Mosaic to offer people the chance to invest in such solar projects.Tweet