Credit Suisse’s Michael Weinstein: Solar Revenue Put can help Sunrun and other residential sponsors to keep solar growing

Originally posted in Michael Weinstein’s Credit Suisse Alternative Energy Solar Snippet, page 3, February 23, 2018.

Higher debt proceeds could also keep WACC lower. ABS proceeds have increased from 62% of loan to value (LTV) for SolarCity’s first solar ABS issued in 2013 to 77% for their last ABS issued in December 2017. Recently, kWh Analytics achieved even a higher LTV of 85%-90% with a Revenue Put that guarantees revenues from a solar project for the life of the asset. Higher LTV and compressing spreads would help offsetthe impact of rising rates.