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The Clean Energy Finance Corporation (CEFC) has pledged to provide up to $100 million to finance loans where the upfront costs of battery installations are not subsidised by the South Australian government under its Home Battery Scheme, which offers subsidies of up to $6,000 for households to cover the cost of installing renewable energy storage systems.
RateSetter has been exclusively selected by the CEFC, which the lender has a long-standing relationship with, to distribute the finance through its renewable energy lending marketplace specific to South Australia.
The lender will additionally enable both retail and institutional investors — including banks, credit unions and superannuation funds — to invest in the CEFC loan financing program.
RateSetter CEO Daniel Foggo said: “For investors, we are providing a simple way to invest directly in loans for renewable energy products while allowing them to earn attractive, stable returns.”
Minister for Energy and Mining Dan van Holst Pellekaan commented: “RateSetter’s plans to bring in even more investment from retail and institutional investors will play a vital role in reducing the upfront cost of batteries.”
The peer-to-peer lender also has an agreement with the South Australian government to be the exclusive administrator of the government’s $100 million Home Battery Scheme, which also provides households with the option to finance the unsubsidised portion of the battery system and rooftop solar if required.
Mr Foggo claimed that the agreement demonstrates that the South Australian government is “embracing new ways of working with businesses that can provide technology-enabled solutions to help improve the lives of Australians”.
The Home Battery Scheme was created to encourage 40,000 South Australian households to install battery storage products in their homes to help reduce the cost of energy, improve the resilience of the state’s energy supply and lower carbon emissions.
The state has experienced some of the nation’s most disruptive blackouts in recent years, prompting Space X and Tesla founder Elon Musk in 2017 to commit to installing the world’s largest lithium-ion battery on a wind farm in South Australia within 100 days of signing an agreement with the state government and French renewable energy company Neoen.
CEFC chief executive Ian Learmonth said that it makes “good economic and environmental sense” for households to add a home battery storage system as it would allow them to “capture even more benefits from their rooftop solar PV”.
In addition to lowering energy costs and carbon emissions, Mr Learmonth said that renewable energy systems are also “an important way to reduce customer demand on the electricity network, especially at peak periods”.
RateSetter and the CEFC have been working together since May 2017, when the corporation committed $20 million to support RateSetter’s Green Loan Marketplace for Australians seeking to purchase or install energy-efficient and solar products.
The peer-to-peer lender claimed that it has since facilitated more than $370 million in green loans to over 27,000 borrowers, with the amount funded each month growing by 100 per cent year-on-year, making it its fastest-growing area of business.
Mr Foggo added: “With a 237 per cent monthly increase in the number of renewable energy loans financed between January and August 2018, this is one of RateSetter’s fastest-growing business areas and firmly positions the business as a market leader for renewable energy finance.
“Loans are currently funded from over 12,000 everyday Australian investors on RateSetter’s platform, as well as several institutional investors including the CEFC, fixed income funds, SMSFs, banks and credit unions.”
[Related: P2P lender extends green loans program]
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