How one company is helping B.C. investors get a piece of the clean energy transition
This time last year, Canadian clean energy investment company CoPower and geothermal installer GeoTility began a conversation about financing. The B.C.-based company was seeking $6.4 million in refinancing for a portfolio of 658 residential geothermal installations they had recently completed for Kelowna area homes.
In the world of infrastructure finance, a $6.4-million loan may not seem remarkable, but the story behind it is for several reasons—starting with the fact that making it possible are hundreds of individual Canadians investing in CoPower’s Green Bonds.
A clean energy investment opportunity for everyone
What makes CoPower’s Green Bonds a game-changer is that they open up new opportunities for clean energy investing on two fronts.
As CoPower founder David Berliner explains, “to invest in clean-energy infrastructure projects you’ve traditionally needed either deep pockets [$6.4M+ in this case] or the expertise to understand the technologies and finance structures involved.”
As a result, banks, pension funds and accredited investors have dominated the fast-growing clean energy finance market which reached $333.5 billion globally in 2017.
But for smaller investors, “finding good opportunities to participate in this growing market can be frustrating,” said Berliner.
This is what his company is working to change. Today, individuals with as little as $5,000 can invest to support carbon-cutting projects like GeoTility’s residential geothermal installations through CoPower’s six-year, 5 percent Green Bonds.
The bonds are backed by loans to real clean-energy and energy-efficiency projects sourced and evaluated by the company’s team of project development and finance professionals.
“We’re doing the heavy lifting to turn an investment once restricted to the Warren Buffetts of the world into something nearly anyone can access,” said Berliner. To-date CoPower has raised more than $18 million for clean energy and energy efficiency through Green Bonds.
The Green Bond model is simple: the projects CoPower lends to sell clean energy or save energy. The money generated (or money saved) is used to repay their CoPower loans. Those loan payments, in turn, generate the revenues used to pay interest to bondholders.
In GeoTility’s case, the projects help homeowners save energy and money on their gas bills and best of all, GeoTility’s unique model makes once-expensive geothermal affordable. Rather than pay steep upfront costs for the exterior equipment and installation, homeowners can now pay a fixed quarterly bill to GeoTility for heating and cooling services, part of which is used to service the CoPower loan.
Today, CoPower’s Green Bond portfolio includes loans to more than 1,100 climate-friendly projects like these across Canada which as well as geothermal include LED retrofits and community solar installations.Photo courtesy CoPower
Competitive returns to accelerate the clean energy transition
In addition to giving individuals access to clean-energy investments, CoPower provides clean-energy developers access to financing that can help accelerate the clean-energy transition.
While it’s now relatively straightforward for a large-scale developer to find $50 million in financing for a utility-scale, clean-energy project, traditional infrastructure lenders like banks and pension funds typically aren’t lending at the $0.5- to $20-million scale required to make distributed projects possible.
“The transition to a high-efficiency, low-carbon energy system will mean a shift to distributed clean-energy projects like residential geothermal, but most traditional infrastructure lenders are still stuck on the old model of financing large-scale, centralized projects like a gas plant,” said Jim Leask, President and CEO of GeoTility.
“It’s great to find a partner like CoPower that offers the kind of financing we need to transform our energy system.”
By lending to portfolios of projects under the $20-million mark, CoPower is helping distributed clean energy developers bridge a sizable financing gap. “What banks are doing on a large-scale, we’re able to do on a distributed scale with a small, nimble team and in-house clean-energy project development and financial know-how,” said Berliner.
With its model of matching clean-energy projects seeking financing with Green Bond investors seeking profit and positive impact, CoPower is literally driving private investments in clean, green power from the ground up. As David Berliner points out, “It’s a win-win proposition.”
To-date, more than 600 Canadians (including individuals and institutions) have invested more than $18 million through CoPower Green Bonds. To learn more about CoPower Green Bonds, check them out here.
To learn more about CoPower Green Bonds visit copower.me.