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SolarCity offers $200m green bonds to retail investors



SolarCity, the leading US installer of residential solar systems, is to offer green bonds directly to consumers, allowing individuals to benefit from the investment opportunity of renewable energy.

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The California-based company will issue $200 million (£124.9m) in the bonds, offering them for as little as $1000 (£625) each. Maturities will range from one to seven years with interest rates of up to 4%. 

The earnings will be paid by income received from monthly payments made by thousands of SolarCity’s customers across the US.

The company, which is backed by billionaire Tesla Motors founder Elon Musk, say the move presents the first opportunity for retail investors to participate in a public solar bond offering.

“This is the first time you’re seeing investment offered broadly to American investors through a public offering,” Newell told journalists on Tuesday.

“In other cases, companies are allowing investors to invest in a single solar project or perhaps a small group of homes or projects.”

The bonds will represent a portfolio of thousands of solar projects and will be offered through SolarCity’s new direct investment website.

The popularity of green bonds – which are used to finance clean energy or environmental efforts – has soared since their first issue in 2008. 

More than $25 billion (£15.6bn) has already been issued in green bonds so far in 2014, according to the Climate Bonds Initiative, with that figure expected to reach $40 billion (£25bn) by the end of the year.

Photo: SolarCity via Twitter

Further reading:

Investors commit to expanding the climate bond market

European Investment Bank issues €500m climate awareness bond

Lloyds Bank predicts increased issuance of responsible bonds

Report: climate bonds enter mainstream, reaching $502bn

Barclays launches Green Bond Index to meet ‘growing demand’