Wall Street banks’ attraction towards solar energy seems to continue. On Wednesday, Wells Fargo & Company (WFC – Analyst Report) announced a further investment of more than $100 million of tax equity financing over the next 18 months to SunEdison, Inc. (SUNE – Analyst Report) – a leading solar energy provider.
Wells Fargo plans to invest in distributed generation solar power projects developed by SunEdison. Since 2007, the banking major has financed almost 200 utility-scale solar projects throughout 13 U.S. states and Puerto Rico, for an amount worth $950 million. This has allowed SunEdison to provide clean and cost-effective energy to its customers.
SunEdison designs its projects according to the terms of a power purchase agreement (PPA). Its customers buy the energy produced for a fixed rate as specified in the PPA. Hence, third-party investors are beneficial to SunEdison as they facilitate the company to install solar power equipment without requiring customers to pay upfront costs. Since 2008, SunEdison has garnered approximately $5 billion in project financing for solar power plants.
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