• 2 hours PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 4 hours Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 6 hours Syrian Rebels Relinquish Control Of Major Gas Field
  • 7 hours Schlumberger Warns Of Moderating Investment In North America
  • 8 hours Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 9 hours Energy Regulators Look To Guard Grid From Cyberattacks
  • 11 hours Mexico Says OPEC Has Not Approached It For Deal Extension
  • 12 hours New Video Game Targets Oil Infrastructure
  • 14 hours Shell Restarts Bonny Light Exports
  • 15 hours Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 21 hours Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 1 day British Utility Companies Brace For Major Reforms
  • 1 day Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 1 day Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 1 day Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 1 day OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 1 day London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 2 days Rosneft Signs $400M Deal With Kurdistan
  • 2 days Kinder Morgan Warns About Trans Mountain Delays
  • 2 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 2 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 2 days Russia, Saudis Team Up To Boost Fracking Tech
  • 3 days Conflicting News Spurs Doubt On Aramco IPO
  • 3 days Exxon Starts Production At New Refinery In Texas
  • 3 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 3 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 3 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 3 days China To Take 5% Of Rosneft’s Output In New Deal
  • 3 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 3 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 3 days VW Fails To Secure Critical Commodity For EVs
  • 4 days Enbridge Pipeline Expansion Finally Approved
  • 4 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 4 days OPEC Oil Deal Compliance Falls To 86%
  • 4 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 4 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 4 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 4 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 5 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 5 days Aramco Says No Plans To Shelve IPO
Half A Million Bpd At Risk From Geopolitical Firestorm

Half A Million Bpd At Risk From Geopolitical Firestorm

Geopolitical tensions are once again…

Chinese EV Boom Could Crash Oil Prices

Chinese EV Boom Could Crash Oil Prices

Most oil majors acknowledge that…

Climate Progress

Climate Progress

Joe Romm is a Fellow at American Progress and is the editor of Climate Progress, which New York Times columnist Tom Friedman called "the indispensable…

More Info

Everyday Americans Can Now Invest In Solar Power Like Germans

Everyday Americans Can Now Invest In Solar Power Like Germans

Solar Panel Installation
Photo Credit: Shutterstock

On top of new storage-plus-solar deals for businesses, lease-to-own models, and business partnerships, SolarCity has just cooked up a new way for everyday Americans to invest in the solar power it provides.

The country’s biggest solar services firm and its leading installer of rooftop solar systems, SolarCity announced on Wednesday that it’s now offering bonds online to everyday investors, the New York Times reported. Bonds are a form of debt: the purchaser pays the bond seller a fixed amount, then the seller pays back the amount over a pre-determined amount of time (maturity) along with interest. It’s a way for a company to build up capital to finance future expansions, particularly in its start-up years. SolarCity’s bonds will be sold in $1,000 increments, and will be available to any U.S. citizen, 18 or older, with a domestic bank account. The bonds will mature in one, two, three, or seven years, and will offer interest rates between two and four percent.

The company has already raised $575 million through the traditional bond market, which is generally only available to wealthy and institutional investors, and is run through middlemen in the financial services industry. Mosaic is the only other solar company to use similar “crowdfunding” structures to finance individual projects on the small- and medium-scale. But unlike SolarCity it doesn’t install the arrays itself, and it only just recently began moving into the residential solar market.

Related: Could Solar Provide 27% Of World’s Energy By 2050?

“We’re similar to crowdfunding in that we’re doing this directly through our own online platform with no fees to purchase,” said Tim Newell, the vice-president of financial products at SolarCity. “We don’t look to earn revenue from the sales of the bonds.”

SolarCity will handle the bond sales and the paperwork through its own website, and the plan is to offer $200 million worth of bonds initially, but expects to make additional offerings on a fairly regular basis in the future. The company will also pay back the bonds using the monthly electricity payments from its solar customers. “The big innovation in this announcement is not solar-specific; it’s the offering of simple, attractive corporate bonds to the general public,” observed Shayle Kann, the vice-president of Greentech Media, a renewable technology research outfit. “The fact that these are ‘solar bonds,’ meaning bonds backed by SolarCity’s revenue streams, is just icing on the cake.”

“By expanding the pool of people who can participate in financing solar with us, we’re diversifying our sources of capital,” Newell added. “That also makes us more resilient in any economic environment and over time should help us be able to have the lowest cost of capital.”

The new direct-to-consumer bonds are admittedly smaller and come with lower rates than the bonds SolarCity has sold in the traditional market. The latter offered longer maturities and interest rates at 4.03 percent or even 4.59 percent.

But in a national and global financial market that’s still seen as somewhat uncertain when it comes to renewable power, direct-to-consumer models, crowdfunding, and other forms of financial innovation have emerged as useful — even crucial — tools in building up green power capacity, either at the level of utilities or for the individual homeowner. “If you look at the task we have to overcome in transforming the energy infrastructure, it’s a massive task,” SolarCity CEO’s Lyndon Rive also said. “We need to deploy large amounts of money as fast as humanly possible… One of our biggest tasks is raising awareness and helping people understand that solar is not a 10-year investment with minimal payback.”

Related: India Is Committed To Solar, But Don’t Invest Just Yet

By giving everyday investors a stake in the energy source, solar bonds can also serve as an implicit marketing program or awareness-raiser for solar power and green policy. “If you have some skin in the game, then you’re going to want [solar] to succeed in the same way as when you invest in a stock, you want that stock to be successful,” Amy Davidsen, the U.S. executive director of The Climate Group, a non-profit organization that seeks to promote clean energy technology, told The Guardian. “[This] will include supporting policies to help support clean energy.”

A similar dynamic has played out in Germany, where citizens locally own about half of the country’s renewable power capacity, meaning they benefit from the returns on the investment. That’s kept support high for Germany’s green energy policies, even as they’ve arguably helped contribute to high residential electricity bills, thanks to some quixotic design choices. SolarCity’s situation is a bit different — it’s raising capital to install solar systems, as opposed to offering ownership in the systems themselves — but the end effect of giving the bond customer a personal stake in the social and economic fate of renewable power more broadly.

Over the long haul, SolarCity hopes the bonds will become a “significant part of our financing strategy,” according to Newell. But, he added, “this is new –- no one has done this before — and we’re going to have to see how it proceeds.”

by Jeff Spross

(Source: http://thinkprogress.org/)

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News