CEFC to expand access to solar PV for households and businesses

22 July 2014

The Clean Energy Finance Corporation (CEFC) is providing up to $120 million to finance three new finance programs including leasing and Power Purchase Agreements (PPA) to help expand and deepen the solar PV market in Australia. 

The three financing programs offer products tailored for specific market segments:

• Up to$70 million for a program by SunEdison Australia, a global solar manufacturer and provider of solar energy services and solutions, offering customers solar leases or the option to sell the power under a PPA.
• Up to $20 million finance for a program offered by Tindo Solar - the only Australian manufacturer of solar PV panels, funded by the Solaire Income Fund (a Lighthouse Infrastructure and Impact Investment Group joint venture) offering a PPA product to commercial and residential customers; and
• Up to $30 million for a program by Kudos Energy - which is backed by the US-based Angeleno Group - offering PPAs focused on commercial and multi-unit residential customers.  

CEFC CEO Oliver Yates said this set of programs would expand the range of financing structures widely available in Australia so that more businesses can take advantage of the country's abundant solar resources and realise our competitive advantage. 

"By expanding the financing options available and introducing new financing models tailored for different market segments, we can help more individual households and businesses to make better use of our resources and save on their energy costs," Mr. Yates said. 

These new financing programs are being brought to market using established, experienced and accredited installation companies and suppliers to provide the market with high quality outcomes. 

SunEdison Australia will work with local partners to originate, design, install, own, operate and maintain solar PV systems and lease them, or sell the power under a PPA (depending on the contract) to customers.

Solar leasing and PPAs have been available in California for nearly 10 years and 75 per cent of new solar PV home installations now use a leasing or PPA structure. PPAs allow customers to buy the energy generated from solar systems vs. purchasing the solar systems themselves, and eliminate a common barrier to solar adoption, the need for up-front capital. 

While PPA programs have been used in Australia for some larger-scale projects they have rarely been used for smaller businesses or the residential sector. By making them available here, these new programs could similarly see leasing and PPAs widely adopted by both residential and commercial customers segments in Australia.

Pashupathy Gopalan, President of SunEdison Asia Pacific, Middle East and South Africa said the CEFC's finance would enable SunEdison use its global experience to introduce a number of financing models to Australia that will provide an immediate cost saving to customers and expand the use of solar resources here," 

"We are proud to partner with the CEFC and bring our global project financing and development experience to provide financially attractive, high quality solar solutions to Australia," Mr. Gopalan said.

Kudos Energy, which is backed by the US-based Angeleno Group will design, install and own solar PV systems and enter into a PPA with the building owner or tenant to purchase power from the panels at a discounted rate, which is lower than their current electricity bill. Kudos Energy will also manage the solar PPA billing process, operations and maintenance of the solar PV systems. 

By removing the need for upfront capital and allowing the benefits to remain with the building occupants when a tenant moves, Kudos Energy's PPAs will accelerate use of solar power by the commercial and strata sectors. 

Kudos Energy Managing Director David Jones said the CEFC's specialist experience was critical in getting their new product to the Australian market. 

"Working with the CEFC has allowed us to provide this solar PV financing option in Australia so that more people can choose to benefit from solar power, regardless of their circumstances," Mr. Jones said.

Tindo Solar's Manager of People and Business, Richard Inwood said Tindo Solar had the capacity to expand the business and employ more Australians in advanced manufacturing and by offering PPAs to residential customers as well as both businesses and government bodies requiring small to medium-sized systems more people can choose a quality, Australian made product."

Jonathan Ruddick, Managing Director, Tindo Asset Management said the CEFC understood solar systems as an asset in an investment and finance context. The Lighthouse Infrastructure and the Impact Investment Group's Solaire Income Fund completes the picture through their renewable infrastructure knowhow and focus on investments that have positive social and environmental impacts. A Tindo PPA offering provides opportunities for jobs, lower electricity prices and the environmental benefits of solar PV." 

Solaire Income Fund Directors Mitch King and Christopher Lock said, "We are excited to work with Tindo Solar, Australia's only solar panel manufacturer. The CEFC is providing important leadership by supporting the Australian solar PPA market, which is an attractive sector for our investors.

About SunEdison

SunEdison is a global leader in transforming how energy is generated, distributed and owned. SunEdison manufactures solar technology and develops, finances, installs and operates distributed solar power plants, delivering predictably priced electricity and services to its residential, commercial, government and utility customers. SunEdison also provides 24/7 asset management, monitoring and reporting services for hundreds of solar systems worldwide via the company's Renewable Operation Centre (ROC). SunEdison has offices in North America, Europe, Latin America, Africa, India and Asia. SunEdison's common stock is listed on the New York Stock Exchange under the symbol "SUNE." To learn more visit www.sunedison.com.

About Angeleno Group

Angeleno Group was founded in 2001 and is a pioneer in providing growth capital for next generation clean energy and natural resources companies. Angeleno Group invests opportunistically in a range of deal types, with a strategy that is sector-focused, stage-agnostic and research-driven. Since its founding, Angeleno Group has become one of the largest dedicated energy growth equity investment firms, making investments on a global basis with investment professionals operating in the US, Asia and Australia.

Angeleno Group's investments in the Australian market include electricity retailer Click Energy, established in 2006, New Forests and a previous investment in solar supplier Nu Energy. www.kudosenergy.com.au

About Tindo Solar

Tindo Solar designs and manufactures technologically advanced and premium quality solar photovoltaic (PV) modules from its automated plant in Adelaide, South Australia with robotic control at every stage of manufacture. Through focusing on automation and the use of advanced robotics, Tindo Solar is able to produce a quality product at affordable prices.  Tindo Solar is enabling clean, renewable power and aims to provide Australia with a cost effective alternative to peak conventionally generated electricity, thereby reducing fossil fuel dependence and greenhouse gas emissions.  Tindo Solar is an integrated Australian solar business from manufacturing to installation and is now a solar PV electricity provider through its PPA business Tindo Asset Management.  Tindo set out to make a panel that respects the Australian sun and to make a panel that would deliver on its product and performance warranty. Tindo's manufacturing plant is situated in the heart of Technology Park, Adelaide, South Australia.

About the Solaire Income Fund

Lighthouse Infrastructure and Impact Investment Group are establishing the $200 million Solaire Income Fund designed to provide long-term stable returns to investors through investment in solar PPAs and related assets.

Impact Investment Group (IIG) is a leading Australian impact investment fund manager, advisor and co-investor, established in early 2013. IIG originates investments in commercial real estate, renewable energy and infrastructure. IIG originates and transacts investments that generate financial performance with sustained environmental and social impact and has over $100 million in assets under management. IIG is owned by Christopher Lock (Chief Executive Officer, Executive Director) and Small Giants, the family office of Daniel Almagor (Non-Executive Director) and Berry Liberman.

Lighthouse Infrastructure was established in 2007 as an independent Australian firm focusing on the investment needs of institutional investors in traditional infrastructure and alternative assets. The company's senior management team has significant experience and is highly regarded in infrastructure investment and management. Lighthouse Infrastructure has completed a number of infrastructure investments with a total value exceeding $2 billion.