Vivint Solar gets lease option approved for Florida customers

Vivint solar

The Florida Public Service Commission has approved Vivint Solar‘s solar lease product proposal, and they are immediately available in the St. Petersburg and Orlando areas. New Vivint Solar customers in other markets in Florida may also have the option to qualify for a solar lease.

Vivint Solar expanded into Florida in 2016. The availability of leases provides more flexible options to go solar for Florida homeowners, who can also purchase a system from Vivint Solar outright or finance the purchase with monthly payments through one of the institutions Vivint Solar has relationships with, or through their preferred lender.

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“We appreciate the commission for clarifying its position and removing any stumbling blocks to the expansion of customer choice for solar power in Florida,” said Vivint Solar CEO David Bywater. “Our solar lease product allows many more customers to benefit from clean, renewable energy, and we are excited that our new Sunshine State customers can adopt solar at zero down for the first time.”

Under a lease agreement, Vivint Solar designs and installs a solar energy system for no upfront cost. The company provides clean, efficient energy from the abundant Florida sunshine to customers, who pay a fixed monthly amount, which provides most customers with overall energy cost savings compared to their local utility. On average, Vivint Solar customers across the United States save up to 20 percent with Vivint Solar’s leases relative to their current utility rates.

— Solar Builder magazine

Vivint Solar nails down new multi-party financial agreement for $327 million in total funding

solar agreement

Vivint Solar, Inc. closed an innovative multi-party forward flow funding arrangement that includes project-level debt, a levered tax equity partnership, and the company’s first cash equity investment. The transaction provides up to $327 million in total funding commitments, with an aggregate value of approximately $410 million, which is structured to generate upfront cash margin for the company for approximately 95 megawatts of future solar energy systems. This transaction is the first of its kind in the residential solar industry that incorporates a multi-party forward purchase commitment anchored by a levered tax equity partnership.

“This delivers another landmark financing transaction for the company in 2018, and we look forward to using this vehicle to continue to accelerate solar power adoption across the country,” said Vivint Solar CEO David Bywater.

Bank of America Merrill Lynch acted in multiple roles in this transaction, including acting as sole structuring and placement agent for the cash equity and multi-draw term loan. Additionally, Bank of America Merrill Lynch acted as the sole tax equity investor. Hannon Armstrong is participating as the structured cash equity investor.

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“The cash margin provided by this vehicle for a portion of our future PPA and lease assets is an important step to increase Vivint Solar’s financial flexibility and to solidify a sustainable funding model for the business,” said Vivint Solar’s Chief Commercial Officer and Head of Capital Markets, Thomas Plagemann. “We expect similar results to selling systems directly to homeowners, allowing us to continue focusing on providing the products best suited for each homeowner.”

Vivint Solar expects to raise approximately $3.37 per watt in upfront proceeds in addition to $0.41 per watt in retained value and renewal value. In addition, the company recently closed a $50 million tax equity partnership with a new investor. This multi-party forward flow funding arrangement, together with the undrawn committed capital under Vivint Solar’s other tax equity partnerships, is estimated to provide funding to install more than 170 megawatts of residential solar energy systems.

— Solar Builder magazine

Vivint Solar nails down new multi-party financial agreement for $327 million in total funding

solar agreement

Vivint Solar, Inc. closed an innovative multi-party forward flow funding arrangement that includes project-level debt, a levered tax equity partnership, and the company’s first cash equity investment. The transaction provides up to $327 million in total funding commitments, with an aggregate value of approximately $410 million, which is structured to generate upfront cash margin for the company for approximately 95 megawatts of future solar energy systems. This transaction is the first of its kind in the residential solar industry that incorporates a multi-party forward purchase commitment anchored by a levered tax equity partnership.

“This delivers another landmark financing transaction for the company in 2018, and we look forward to using this vehicle to continue to accelerate solar power adoption across the country,” said Vivint Solar CEO David Bywater.

Bank of America Merrill Lynch acted in multiple roles in this transaction, including acting as sole structuring and placement agent for the cash equity and multi-draw term loan. Additionally, Bank of America Merrill Lynch acted as the sole tax equity investor. Hannon Armstrong is participating as the structured cash equity investor.

RELATED: This new exchange opens up a $5 billion C&I solar financing network

“The cash margin provided by this vehicle for a portion of our future PPA and lease assets is an important step to increase Vivint Solar’s financial flexibility and to solidify a sustainable funding model for the business,” said Vivint Solar’s Chief Commercial Officer and Head of Capital Markets, Thomas Plagemann. “We expect similar results to selling systems directly to homeowners, allowing us to continue focusing on providing the products best suited for each homeowner.”

Vivint Solar expects to raise approximately $3.37 per watt in upfront proceeds in addition to $0.41 per watt in retained value and renewal value. In addition, the company recently closed a $50 million tax equity partnership with a new investor. This multi-party forward flow funding arrangement, together with the undrawn committed capital under Vivint Solar’s other tax equity partnerships, is estimated to provide funding to install more than 170 megawatts of residential solar energy systems.

— Solar Builder magazine

Vivint Solar closes on $811 million in new financing (largest securitization of residential PPAs ever)

Vivint solar

Vivint Solar has closed on $811 million aggregate principal amount of debt financing comprised of two separate transactions.

The first is a capital markets issuance by its wholly-owned subsidiary, Vivint Solar Financing V, LLC, of $466 million aggregate principal amount of Solar Asset Backed Notes, Series 2018-1. The offering was upsized from the original offering size of $355 million to become the largest securitization of residential solar power purchase agreements and leases to date. Credit Suisse Securities (USA) LLC and Citigroup Global Markets, Inc. acted as joint bookrunners and co-structuring agents and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Deutsche Bank Securities Inc. and SunTrust Robinson Humphrey, Inc. acted as co-managers for the issuance of the Series 2018-1 Notes.

In addition, Vivint Solar Financing IV, LLC issued, in a private placement, $345 million aggregate principal amount of Solar Asset Backed Notes, Series 2018-2. Credit Suisse was the sole arranger of the private placement of the Series 2018-2 Notes.

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The proceeds from these two financings will be used to repay in full, or reduce the outstanding balance of, certain existing debt facilities of Vivint Solar, Inc. and its subsidiaries and for general corporate purposes. Overall these transactions lower Vivint Solar, Inc.’s blended total credit spreads by approximately 160 basis points.

The Series 2018-1 Class A Notes will have an interest rate of 4.73 percent and an anticipated repayment date of October 30, 2028. The Series 2018-1 Class B Notes will have an interest rate of 7.37 percent and an anticipated repayment date of October 30, 2028.

Vivint Solar Financing IV, LLC entered into an interest rate swap concurrent with issuance of the Series 2018-2 Notes that results in an implied all-in interest rate of approximately 5.95 percent. The term of each of the separate financings was structured to exceed the expected “flip” date of the underlying project tax equity funds.

“We are pleased to announce this new milestone in the evolution of our financing strategy, which optimizes and simplifies our term debt structure while allowing us to repay more expensive outstanding loans, increase advance rates, lock in attractive fixed borrowing rates and create incremental liquidity for the business,” said Chief Commercial Officer and Head of Capital Markets Thomas Plagemann. “We appreciate our investors’ continued support and commitment to accelerating solar power adoption.”

On a combined basis the financings provide back-leverage financing for a portfolio of 16 tax equity funds and one wholly owned subsidiary that own 575 megawatts and over 86,000 residential solar energy systems.

— Solar Builder magazine

Vivint Solar sued by New Mexico attorney general, claiming its PPAs ‘cloud titles’

New Mexico sues Vivint Solar

New Mexico Attorney General Hector Balderas took aim at Vivint Solar, Inc. in a lawsuit filed last week, claiming “unfair and unconscionable business practices, including clouding titles to consumers’ homes, fraud and racketeering in connection with its residential solar power purchase agreements and solar equipment.” A bold claim to be sure, and one Vivint Solar is obviously refuting.

In his announcement of the lawsuit, Balderas says his investigation learned of hundreds of clouded titles and thousands of Vivint customers in New Mexico. The complaint alleges that Vivint binds New Mexico consumers into 20-year contracts that require consumers to purchase the electricity generated by a solar system placed on their homes at rates that increase by over 72% during the 20 years. The complaint further alleges that Vivint deploys door-to-door sales managers to engage in high pressure sales techniques and procedures designed to mislead consumers into believing that these 20-year contracts will save them substantial amounts of money.

Vivint Solar disagrees and sees the statements made in the press release we quoted above are misleading (and actually do not even accurately describe the allegations in the lawsuit itself). Here is Vivint Solar’s response:

To be clear, Vivint Solar does not, has not, will not and cannot ever jeopardize its customers’ home ownership. Vivint Solar does not take a lien on its customers’ homes under its Power Purchase Agreements (PPAs) or Solar System Lease Agreements. A PPA is commonly used throughout the residential solar industry as a means of providing consumers with access to clean, affordable energy with no upfront investment by the customer; in exchange, the customer agrees to pay for all energy produced by the solar energy system.

Vivint Solar’s PPA relationships with New Mexico customers and throughout the country are no different. Under a PPA, Vivint Solar designs, purchases equipment for and installs a solar energy system on the customer’s home at no initial cost to the customer. Our customers purchase the energy produced by the system on their home during the term of the PPA, often at a discounted price to the utility. Vivint Solar records a notice in the county property records to disclose the fact that it owns the solar energy system. Vivint Solar does not record a lien on the customer’s home.

The attorney general’s office is well aware of this fact, and the press release headline that Vivint Solar is “jeopardizing home ownership” for customers is misleading and is not even an allegation in the lawsuit.

In the event that customers with a PPA refinance or sell their homes, Vivint Solar regularly works with customers and their financial institutions to make sure that there is no confusion about the scope of Vivint Solar’s interest. We care about our customers, and the last thing we want to do is impede a customer’s refinancing or sale of their property.

We look forward to defending ourselves in the court action.

— Solar Builder magazine