Institutional Investors in Solar – NAB’s $200m Portfolio

Institutional Investors in solar have had some great news this week as NAB’s Low Carbon Shared Portfolio represents a $200m pool of loans to renewable projects – so it’s a fantastic way to invest in clean energy in Australia. The portfolio allows the public to support large-scale solar and wind farms which they weren’t previously able to do.

Institutional Investors in Solar

NAB Institutional Investors in Solar
NAB Institutional Investors in Solar (source: NAB.com.au)

Institutional Investors in Solar will be able to invest in the $200m facility which has seven ‘senior loans’ to wind and large scale solar farms financed by NAB.  The CEFC has also chipped in a $90m cornerstone investment:

“The Low Carbon Shared Portfolio creates an opportunity for institutional investors to participate in the renewable energy sector even though they may not be able to enter into individual project financing transactions,” Richard Lovell from the Clean Energy Finance Corporation said. 

“This offering is unique in giving investors credit exposure to the underlying projects, a significant innovation in the market.”

NAB have advised that the seven projects in the Low Carbon Shared Portfolio represent 2.5 million tonnes of displaced CO2 emissions – the equivalent to 350,000 Australian households (i.e. a very significant amount). 

Former NSW Premier Mike Baird is now the head of customer relations for corporate and institutional banking at NAB. Mr Baird spoke of the project and NAB’s goals:

“We’re responding by providing ways for institutional investors to back major renewable energy projects alongside NAB, while releasing capital for NAB to continue to reinvest in the renewables sector.”

According to the Fifth Estate, all seven loans in the Low Carbon Shared Portfolio are in Australian dollars and all have a remaining tenor of at least 15 months. The loan portfolio has an expected weighted average life of 3.2 years. NAB will retain at least 25 per cent of each low carbon loan on its own balance sheet and will manage the loans for the shared portfolio. If NAB exits a particular loan, the shared portfolio will also divest.  

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