Strong Funding for Solar Finance, Technology and Startups Despite Stock Market Carnage

A roundup of recent positive financial solar news from SolarCity, Sunrun, Sungevity, DOE, Sunnova and more.

Despite solar stocks plummeting in a "bizarre confluence of contradictory events," low-cost capital, DOE funding and VC are pouring into the market. Here's a roundup of some recent solar funding events.

Sunnova Energy secured approximately $300 million in debt and equity funding for its residential solar energy business last month. When you're in the top 10 in a residential solar finance field that includes SolarCity, Sungevity, SunPower, Sunrun and Vivint, it's possible for a significant player like Sunnova to get drowned out by the other news, noise and hype.  The transaction includes a conduit facility arranged by Credit Suisse, and an equity financing round led by Triangle Peak Partners. Additional equity investors include business development companies sponsored by Franklin Square Capital Partners, "sub-advised by GSO Capital Partners LP, the Credit Division of the Blackstone Group," as per a release. Franklin Square managed $13.6 billion in assets last year. The announcement brings Sunnova’s total fundraising to almost $900 million. Sunnova CEO John Berger told GTM in a recent interview, “We are bigger than people think, and we are seeing continued market-share growth."   

Sunrun, a rooftop solar financier and installer, is looking to borrow $230 million to finance residential PV systems, according to reports in Bloomberg. The debt will have a five-year term and will let Sunrun refinance in the asset-backed securities market.    

Past SolarCity investor Silver Lake Kraftwerk has agreed to invest $100 million, SolarCity Chairman Elon Musk will invest $10 million and SolarCity CEO Lyndon Rive will invest $3 million in SolarCity's zero coupon convertible senior notes. "We believe that SolarCity is a highly attractive long-term investment opportunity," said Josh Raffaelli, managing director at Silver Lake Kraftwerk in a release, adding, "We think [SolarCity's] unparalleled access to solar-specific tax equity, asset-backed security and debt clearly differentiates it from providers that are funding projects constantly via equity markets." The notes will be senior, unsecured obligations of the firm, "will not bear ordinary interest, and the principal amount of the notes will not accrete. It is expected that the notes will be convertible into shares of SolarCity's common stock, based on an initial conversion rate of 30.303 shares of common stock per $1,000 principal amount of the notes." 

Solar sales firm Sungevity recently signed a deal with energy retailer Viridian while displacing SolarCity at the firm. An astute reader listened in on earnings call and points out that as part of the partnership, Viridity's parent company "Crius Energy received a one-time grant of 120 million warrants to purchase Series C Preferred Shares of Sungevity with a five year term, at a strike price of US$0.09 per share. The warrants vest at the latter of the one year anniversary of the Reseller Agreement or once certain performance criteria have been met."

Trina Solar announced that two of its overseas subsidiaries, Trina Solar U.S. and Trina Solar Singapore, have signed a total of $90 million in financing facility agreements with Wells Fargo and Barclays Bank.

Blue Raven Solar, a solar originator that describes itself as "one of the fastest-growing residential solar energy providers," won an undisclosed investment ("eight figures," according to trusted sources) from Peterson Partners, a Salt Lake City-based investment firm. Co-founders Ryan Lee and Tyson Peschke had three employees at this time last year. Today the company has a direct sales network with 439 total employees in nine different states operating out of 24 offices. The company offers PPAs but also sells "a vastly superior proprietary solar product that allows us to enter states with little to no competition from other solar companies." Peterson Partners has invested in Vivint and Vivint Solar, JetBlue, Azul, EnergySolutions and 130 other companies.

Sighten is an early-stage solar software confronting a largely U.S. problem -- disproportionate solar soft costs. The startup landed a $3.5 million round A of venture funding from Obvious Ventures. Sighten's platform looks to drive down soft costs by addressing the "solar lifecycle, from sales to asset management," according to the firm's CEO, Conlan O'Leary. Soft costs include customer acquisition, installer overhead, financing, contracts, inspection, permitting, interconnection and installation labor. That list now accounts for about 50 percent of the cost of a residential solar system, according to a 2013 NREL report. Customer acquisition makes up roughly 10 percent of a residential solar system’s total cost. Sighten's customer is "anyone installing or selling residential solar."

The U.S. DOE's SunShot program announced $22.7 million for 23 projects to "significantly reduce the costs for solar energy systems across a variety of technologies." The awardees are: