The Colorado-based solar energy project developer AES Distributed Energy has revealed that it will be securitizing a portfolio of solar energy assets for a total of $100 million, according to recent reports. The notes will be secured with the revenue from around 1,548 US solar energy installations.
The deal marks the sixth major solar securitization of its type in the US in recent years. The securitization will be composed of $92.5 million Class A notes and $7.5 million Class B notes, according to Kroll Bond Rating Agency — with the larger tranche being rated at BBB, and the smaller tranche being rated at B.
The recent report from Kroll Bond Rating Agency (from where those figures were originally pulled) also made the note (referenced above) that the notes will be secured via revenue from 1,548 solar projects. These projects are reportedly spread across 6 different US states, and include commercial, residential, small-scale utility, and industrial-type solar power projects. All of the projects in question currently possess long-term power purchase agreements (PPAs).
This move by AES Distributed Energy follows a recent announcement from Sunrun (in July) that it would be doing a $111 million offering. The noted solar leasing company SolarCity has also to date completed 4 of these sorts of deals — with the first occurring back in 2013, and the most recent one occurring last month.
“There is a market for it, otherwise there wouldn’t be six securitizations,” stated the senior director at Kroll Bond Rating Agency, Cecil Smart, in an interview with Bloomberg. Smart added that the figures related to the new offer are pretty much what’s to be expected in a “market still finding its legs.”
The new securitization will be issued via the AES unit Aurora Master Funding.