CitiGroup Opens Up $200 Million Solar Credit Line or Kilowatt Financial

This move will enable company to extend helping hand to more U.S customers keen on installing rooftop PV.

Global investment banking group Citigroup (NYSE:C) has jumped into the field of energy financing by announcing that it has launched the opening of a $200 million credit line with its partner, Minneapolis-based clean energy financing group, Kilowatt Financial, in a move that will help the company to expand solar lending program to include more mainstream US customers who are keen to install rooftop PV equipment and system in a bid to control, if not eliminate, their energy bills, especially when they have mortgage to pay too. Under the deal, homeowners who are willing to install a rooftop PV system will be offered zero money down loan for a period of up to 20 years.

The two partners will first ‘securitize’ the loans, in order to give a boost for additional capital for future solar projects from commercial developers. While no details were provided from for the new debt warehouse facility, Kilowatt Financial though did receive around $100 million last year in the form of consumer energy efficiency projects.

Marshal Salant, Citigroup’s head business segments of alternative energy finance, stated that this partnership with Kilowatt Financial is part of their mission to assist consumers to power up their homes with low cost renewable energy. He also says that it is a fragment of a goal of financing around close to a $100 billion environmental and clean energy goal for the next decade until the early 2020’s. All of the financing will come from loans and investments.

The financing program will be available to all US homeowners throughout the country, who will be offered low interest rates to accommodate for the nonexistent upfront costs involved. Kilowatt CFO, Matt Mellitus, stated that although such types of program do exist, what differentiates it from the rest of the pack is that it helps to attain a better yield on their investment in renewable energy, which will be relative to the financial products, generally offered to them.

Last month, the financial banking reported previous quarter earnings report, with earnings per share recorded at $1.52, beating past consensus estimates of less than $1.40. With these positive results, the company is likely able to exercise greater financial muscle to move ahead with its renewable energy financing scheme nationally, and possibly, internationally, as worries of climate changes spurs banks and financial institutions around the world to rocket ahead with their schemes to rope in more customers to be more environmentally responsible. Consequently, there are plenty of opportunities for Ciitgroup to take advantage.

Citigroup Stock price ended the day at $52.82, almost 0.10% from the previous trading day.