California — kWh Analytics announced that it structured a Solar Revenue Put as part of the refinancing of the 173 MW DC Cal Flats 130 photovoltaic facility located in Monterey County, California.
The Solar Revenue Put is structured as an insurance policy on solar production and revenues, which serves as a credit enhancement for financial investors.
Using its proprietary actuarial model and risk management software (“HelioStats”), kWh Analytics developed the Solar Revenue Put to drive down investment risk and encourage the development of clean, low-cost solar energy for the Cal Flats facility.
The facility is owned and operated by Capital Dynamics, an independent global private asset management firm focusing on private assets including private equity, private credit, and clean energy infrastructure.
The refinancing was led by Commonwealth Bank of Australia (CBA), Australia’s leading provider of integrated financial services and among the leading arrangers of renewable energy projects in the U.S., Europe and Australia; and Rabobank, a leading global bank focused on the food, agribusiness, commodities, and renewable energy industries. Swiss Re Corporate Solutions, a subsidiary of Swiss Re, the world’s largest reinsurer, is providing capacity for the Solar Revenue Put. This is the first syndicated refinancing utilizing the Solar Revenue Put.
“Capital Dynamics is a leader in clean energy investing and is focused on helping its customers affordably and reliably meet their sustainable energy needs. Community solar farms bring renewable energy to our customers while saving them money on their electric bills,” said Benoit Allehaut, Managing Director of Capital Dynamics’ Clean Energy Infrastructure team. “The Solar Revenue Put helps sharpen our competitive edge by enhancing our returns and reducing our downside risk.”
Across the industry, portfolios supported by the Solar Revenue Put are securing debt sizing increases of 10% on average. The Solar Revenue Put has been structured on over $1 billion of solar assets, and a survey of the solar industry’s most active lenders indicates that more than 50% of active lenders value the Solar Revenue Put as a credit enhancement. The Solar Revenue Put has now been incorporated into both new build financing and refinancing of all types of solar projects, including utility-scale, residential, community solar, and commercial and industrial.