Hannon Armstrong Sustainable Infrastructure Capital partnered with Sol Systems to launch a fund of up to $100 million to to support distributed solar projects. The fund will support commercial, industrial, municipal and utility-scale solar projects, according to the companies.
The new fund takes advantage of Hanson Armstrong’s capital resources, which have financed more than $4.5 billion in sustainable energy and energy efficiency projects since 2000 and Sol Systems’ solar financing capabilities, which include solar renewable energy credit management, debt financing and tax-based investments.
Over the past few years, the big stories in solar energy were gigantic solar projects like Ivanpah and the rapidly growing residential solar market in the U.S. Prior to that the story was more about commercial installations like on Walgreens or other companies but that sector of the solar installation market shrunk because the incentives favored both residential utility-scale solar. Now that solar costs have fallen significantly and the markets have grown, commercial solar may again be on the upswing.
“The lack of financing for mid-sized distributed generation has been a critical barrier to the solar industry’s continued growth,” said Yuri Horwitz, CEO of Sol Systems. “There are few meaningful debt providers or products available, especially for commercial and industrial solar projects, and we are proud to work with such an accomplished partner to facilitate the deployment of capital in this underserved sector of the solar market.”
"With this programmatic finance solution for solar developers, we are looking to take the economic and documentation uncertainties out of the finance process and accelerate a developer's ability to close on a project. Expanding our relationship with Sol Systems to include the origination and structuring of new debt financing opportunities for distributed solar developers is another step towards building a broad market position," explained Hanson Armstrong CEO Jeffrey Eckel. "We believe this new offering will provide the distributed solar industry with a flexible source of capital for portfolios of smaller projects, along with the skilled staff needed to transact at scale, with speed."
With offerings like this it could help that sector of the solar industry grow significantly in 2014 and beyond. However, financing smaller utility-scale projects could quickly eat up a chunk of those financing resources.Tweet