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Funds Launch $200m in Energy Efficiency Investment

January 24, 2014 By William Opalka

moneyTwo funds launched investments of $100 million each in energy efficiency to tap into the estimated $900 billion market.

Joule Assets Inc. launched the Joule Energy Reduction Assets Fund (ERA Fund), a private equity fund that will invest worldwide in energy efficiency and demand response markets.

An energy reduction asset or ERA is an umbrella term for any unit of saved energy, which has become a tangible asset.

“In the simplest terms, we’ve created an investment fund that will expand financing for energy efficiency. On a grander scale, we believe that we have designed a fund that will aim to achieve the returns of top-performing private equity funds,” Joule Assets CEO, Mike Gordon said on the firm’s blog.

Clean energy consumer finance company Kilowatt Financial closed a $100 million debt facility from Citi to finance energy efficiency loans for homeowners.

Kilowatt will enable homeowners throughout the US to make energy efficient improvements to their homes through 10-12 year unsecured loans of up to $30,000. Homeowners can use the funds for a broad range of improvements, including HVAC equipment, water heaters, windows, roofing, insulation, lighting, and energy efficient appliances.

Securitization of the pool of loans into the capital markets is anticipated, which will help establish a secondary market and scale energy efficiency activity. Kilowatt and Citi expect to create term asset-backed securities from the loans, making more capital available for additional homeowners to upgrade their homes.

 


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