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Published on January 30th, 2016 | by Guest Contributor

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China’s 1st Solar Securitization Launched By Shenzen Energy

January 30th, 2016 by  

Originally published on Sustainnovate.
By Henry Lindon

Shenzen Energy Launches China’s First Solar Securitization With CNY1 Billion Tranche

Shenzhen Energy recently launched what represents the first solar securitization in China, which will see bonds offered with a CNY1 billion tranche (roughly $150 million), according to recent reports.

The Bank of China’s investment arm — BOC International — was reportedly the underwriter for the bonds, which are backed against future revenues from solar projects owned by Shenzhen Energy. The bonds will have an interest rate of between 3.6% and 4.5%.

While the move is, for now, somewhat novel for China, the securement of finance via the future income of solar projects is not rare in the US — with the solar leasing company SolarCity being a good example of those pursuing such strategies.

The new bonds from Shenzen Energy are reportedly quite competitive for the market. It’ll be interesting to see what happens in the near future, with regard to other companies that are watching the move’s implementation.

Image by Christina B Castro (some rights reserved)

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  • Securitizing everything with a cashflow is NOT a good thing. Allowing the existence of derivatives with a fictive value far in excess of all the money in the world is what brought down the world economy in ’08 and it will do so again and again, until the madness in ended.

  • Dan

    Seems like the fastest way to grow solar. Yieldcos for concious people may be able to raise capital and just feed the profits back into more solar investments while sacraficing dividends. People like Mark Zuckerberg, Manoj Bhargava, and Bill Gates and serious governments like China’s who have a lot of money and want to do something useful for the world could start investment strategies like a not for profit business. Instead of paying dividends it just cascades the power purchase agreement income into funding more solar. By the end of it, after replacing all the fossil fuel generators in the world, electricity could be nearly free with this investment group feeding into other philanthropic projects. Great Pacific Garbage Patch?

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