Solar Securitization and the Solar Access to Public Capital (SAPC) Working Group
Background & SAPC Presentations
NREL's Solar Access to Public Capital (SAPC) working group was designed to open capital market investment for solar assets via securitization and other financial innovations. SAPC was a three-year initiative that ended in September 2015. SAPC membership included over 440 organizations such as top residential and commercial solar developers, law firms, investment banks and capital managers, rating agencies, independent engineers, and other key stakeholders in the solar finance space.
SAPC encompassed numerous initiatives, described below, to build consistency and quality in the asset class, provide investors the data and other tools necessary to minimize due diligence cost and time, and ease a pathway to securitization and other investment mechanisms across the solar development community.
See the following for background materials:
April 2015 presentation delivered at the SAPC in-person meeting on April 29th, 2015 – New York City, NY
May 2014 presentation delivered to the Clean Energy Ministerial – Seoul, Republic of Korea
Solar Securitization: A Status Report
September 2013 SAPC presentation given at the Renewable Energy Finance Forum – West conference in San Francisco, CA
SAPC was organized by NREL and was paid for by the Department of Energy under the SunShot Initiative. For questions about SAPC or this website, please email Francisco.Flores-Espino@nrel.gov.
SAPC Standard Contracts
The following documents were designed to improve consumer transparency, reduce transaction costs in the solar asset contracting process, and facilitate the pooling of the associated cash flows so that they may be securitized and sold in the capital markets.
- Residential Loan Agreement – (Forthcoming)
Coversheet Home Improvement Contract Performance Warranty Loan Module
- Residential PPA Agreement – Aggregated Business Model (for vertically integrated developers and installers)
- Residential PPA Agreement – Disaggregated Business Model (for developers with a network of installation partners, or third-party finance providers that are discrete entities)
- 0% Down Residential Lease – Aggregated Business Model
- 0% Down Residential Lease – Disaggregated Business Model
- Commercial Lease version 1.0
- Commercial PPA version 1.1
- Change log for Commercial PPA
Best Practices of Installation and Operation and Maintenance (O&M)
Several SAPC subcommittees were dedicated to asset quality to improve investor confidence assets are well built and well maintained. Installation Best Practices (referred to as Quality Assurance Protocols) were developed by a subcommittee focused in this area, see below. O&M Best Practices and an O&M cost model were developed by a relevant subcommittee on that task.
- Best Practices in Residential PV System Installation, version 1.0
- Best Practices in Commercial and Industrial (C&I) PV System Installation, version 1.0
- Best Practices in PV Operations and Maintenance, version 1.0
oSPARC Performance Data
The Open Solar Performance and Reliability Clearinghouse (oSPARC) database is available for pubic evaluation and data contribution. The database was developed by the SunSpec Alliance in collaboration with NREL and the SAPC process.
Mock Filings with Rating Agencies
SAPC members developed two mock filings to foster dialogue with the rating agencies and the solar community: one for a pool of residential leases and another for a pool of commercial PPAs. The SAPC Legal subcommittee developed the following mock securitization term sheets (i.e., legal descriptions of the securitization structure, managing entities, and cashflow waterfall) to facilitate comprehension of solar securitization and potentially reduce transaction costs for new securitizations to reach the market. The SAPC commercial term sheet includes a novel approach to raising debt by promoting a "tandem" structure that includes both tax equity and securitization debt in the initial capital stack.
The tandem structure is available here. The residential term sheet will be available soon.