The transaction marks an important evolution of how credit insurance can be used to enhance credit for large renewable energy projects.
Boston, MA – April 8, 2024 – Energetic Capital (“Energetic”) announced its first ever binder for a credit insurance policy that will cover offtaker payment risk in a utility scale transaction. EneRate Credit Cover, a proprietary credit insurance policy offered by Energetic Capital, is an established solution for C&I developers seeking to make their projects more bankable. Application in a utility scale transaction is an important evolution that demonstrates the flexibility of Energetic’s underwriting capabilities. EneRate Credit Cover employs a novel risk-based pricing model that leverages proprietary market forecasting.
This transaction also signals an important market shift. Historically, credit enhancement has not been required for large utility scale projects with large, regulated utilities as offtaker. Rising load requirements and ESG initiatives are causing more corporates and their suppliers to enter into bilateral agreements with generators, introducing counterparty credit challenges that were not relevant for utility scale transactions.Virtual and offsite PPAs are making renewable energy more accessible, but many investors are unwilling to lend to projects that rely on sub-investment grade or unrated offtake.
“Renewable energy procurement is no longer limited to companies engaging in principled investment strategies. It now forms a cornerstone of the energy supply for large consumers. We are excited to be able to help facilitate this shift into a wider market The benefits of distributed energy resources should be more widely distributed. We are excited to expand our thesis into large scale projects and enable more buyers to access clean energy.” said Jeff McAulay, CEO at Energetic.
The transaction is an important milestone for Energetic and for the industry as a whole as the industry moves meet clean energy targets and combat climate change. To learn more about Energetic’s products reach out!
For media inquiries, please contact:
James Bowen - (617) 416-2923
NOTE: This Press Release does not constitute and is not intended by Energetic Capital or any of the entities mentioned in this release to constitute a solicitation for any insurance business.
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About Energetic Capital(www.energeticcapital.com)
Energetic Capital is a specialty financing company with a novel, data-driven approach to develop new risk management products to unlock investment in the renewable energy industry. Our first product, EneRate Credit Cover®, unlocks renewable energy project financing for unrated and below investment grade counter parties by covering counterparty credit risk. In 2023, Energetic added lending capabilities in order to provide more solutions for its customers.
Headquartered in Boston, Energetic Capital was awarded a SunShot Prize from the US Department of Energy in 2017 and has received a total of $5M in financing to date. EneRate Credit Cover™ and other insurance policies are issued by RE3 Energetic Insurance Solutions, LLC, or SiKey Insurance Services, LLC in New York, wholly-owned subsidiaries of Energetic Insurance, Inc. d/b/a Energetic Capital. Energetic Capital complies with all state-mandated regulations for surplus line insurance brokers and RE3 Energetic Insurance Solutions, LLC is licensed as a surplus lines broker in Massachusetts with License #: 2053916.
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