Mercatus launches its next-generation platform to accelerate securitization of residential and commercial solar portfolios.
Mercatus, Inc., has been in the news lately for creating the solar industry’s first equivalent of a credit score for solar power projects. In doing that, the company, a solutions provider for the energy project finance industry, provided yet another important piece of the solar financing puzzle. Developments in this area are noteworthy in moving the solar industry closer to being an asset class. That’s important because financing for projects will come when the industry is understood and trusted by banks.
The Mercatus investment analysis and decision-making platform serves as a core “operating system” for solar energy investors. It helps investors evaluate projects using their own language, which makes projects more bankable.
Today, the company announced the release of its second-generation platform, Mercatus 2.0. They aim for the platform to accelerate securitizations of residential and commercial portfolios.
The Mercatus 2.0 release includes new and enhanced features, such as portfolio analysis and automated ratings for both the residential and the commercial segments. The company sees these additions as major enablers for the “onslaught of distributed generation solar securitizations” they expect this year. The new release also features enhanced tools to help investors make more informed decisions when allocating budgets and resources with data and analytics for real-time performance measurements.
Since its 2009 inception, Mercatus has assessed over 11 GW of solar projects. The company currently serves 40% of the distributed generation U.S. solar market. Subscribers to the Mercatus platform are currently targeting $1.2 billion in dedicated capital deployment for distributed generation solar investments in 2014.
“As Wall Street begins to eye the industry as an emerging asset class, new financing vehicles such as Yieldcos, MLPs, Solar REITs, and PACE financing require a sophisticated solution to rapidly deploy capital and help the industry reach its full potential, both as a mainstream source of distributed generation and a viable asset class,” said Haresh Patel, CEO of Mercatus. “Mercatus 2.0 is the answer, providing the fastest and most accurate solar investment analysis and decision making tools in the industry. Our comprehensive solution saves investors time and millions of dollars in due diligence costs and lost opportunities.”
Patel added, “The solar sector has seen massive shifts in the last 18 months. While the cost of technology and installation have fallen dramatically, one factor has remained constant — the high cost of financing. Developers, tasked with originating bankable projects, are failing to attract capital, as evidenced by abysmal closure rates of 1-2% annually. Solar energy investors — lacking the resources, best practices, and in some cases, domain expertise to make expedient decisions — are simply not deploying capital.”
The release of Mercatus 2.0 coincides with the closing of Series A financing with an investment by Trepp, LLC, the leading provider of information, analytics, and technology to the CMBS, commercial real estate and banking markets. Trepp’s investment is combined with Vision Ridge Partners, who led the Mercatus Series A funding in May 2014, along with Augment Ventures and Shah Capital.
“The new relationship with Trepp helps bolster the Mercatus offering with additional data feeds, analytics capabilities, and intelligence for optimizing revenue and profit margins in existing markets, and enhancing the ability to enter new markets,” said Patel. “The combined efforts of Trepp and Mercatus help provide the building blocks required to accelerate securitization and other low cost capital financing vehicles to help make solar a major asset class.”