http://www.pv-tech.org/news/sunrun_to_raise_111_million_via_securitization
I believe its secured by the income stream generated by the solar panels, but I don’t think you’re buying the actual income streams. I’ve never looked at a prospectus for the solar securitizations, so hopefully someone else has some real info on it.
Could it work like an MBS? SPBS - Solar Panel Backed Security.
I once saw a structure that securitized the future cost saves from energy efficient additions to Section 8 Housing. I was hoping the solar panel structure would be that interesting, but sadly it wasn’t lol
You can securitize your future poops and someone will buy. 
Isn’t there some sort of tax credit or discounting mechanism that investors get from buying Solar company debt? Curious if this could also apply to the ABS
not if a carbon tax is on the horizon. haha.
I am a calm and mellow person. I would like to securitize.
http://thepowerofpoop.com/epatients/fecal-transplant-instructions/
Connect the dots.
Financial institutions often buy tax benefits from the solar companies, as tax equity investors. I don’t think the solar companies are able to take advantage of the tax advantages b/c they don’t have taxable income, so big, profitable financial institutions buy them as tax shields. These are things like bonus and accelerated depreciation. I don’t think they are put into ABS but I could be wrong b/c there is a lot of creativity in the solar finance space right now.
They are pretty attractive assets for profitable companies b/c they have returns in the ~7% to 9% range or so and are quite low risk. They are quite valuable to reliably profitable companies. It actually is a little complicated how they set these things up. This is a very specialized business, and my knowledge is limited on it. Banks and other companies have experts that set this stuff up.
this is what happens with more people.
your investment only works if more people stay away from solar.
Tommy, what are your thoughts on SUNE’s Vivint acquisition? I’m not a big fan of rooftop solar, prefer utility scale solar myself and they paid a pretty high multiple, 3.5% DCF yield for this, vs the 7-9% that larger projects go for…
^I agree with you on preferring the larger scale commercial projects. I like SunEdison and all but I worry they have their hands more than full right now, and adding another acquisition into the mix complicates things even further. This company is exceptionally busy right now.
I think you know this industry more than me, though. I only got pulled into this industry when a colleague left for another job and I worked on this stuff until we got a replacement.
I’m not sure what this chart is showing on the x-axis but my system is producing about 50 kWh daily. It cost about $2,000 per kW after the tax credits. As more solar installations are brought online there will be fewer customers for the existing power which should raise rates at a faster trajectory. I guess the big risk would be that net metering goes away and I need to buy a battery from Tesla or someone else down the road.
it’s the y-axis you should care about. negative pricing.
what city do you live in? Most cities in America dont have the weather for solid solar energy
SUNE sure has taken a bloodbath over the last 2 weeks… down about 43% since July 20
I thinkit has multibagger potential… if you like highly levered situations with complex financial engineering, uncertain returns, exposure to rising interest rates, execution risk, emerging market exposure, backlog that may not materialize etc…I do though. Mgmt may make mistakes like Vivint, but I think they have the right idea.
Long SUNE
I rode SUNE for a pretty good profit this year, sold mid-June. I bought back in before close today.