The South Australia government’s landmark $100 million Home Battery Scheme will be underpinned by a $100 million funding from the Clean Energy Finance Corporation (CEFC), which will be delivered through U.K.-based RateSetter’s lending market.
Under the Home Battery Scheme, the subsidies of up to $6,000 will be available to 40,000 South Australian households and scaled in line with the size of the system being installed.
However, in cases when the upfront costs of the home battery system installations are not met by the South Australia government subsidies, the CEFC funding will be available in the form of loans delivered through RateSetter’s new South Australia-specific renewable energy lending market.
“It makes good economic and environmental sense for home owners to capture even more benefits from their rooftop solar PV with the addition of home battery storage. This investment has the twin benefits of cutting household energy costs, as well as reducing their carbon emissions,“ CEFC CEO Ian Learmonth said.
At the same time RateSetter will enable South Australian retail investors – as well as institutional investors such as banks, credit unions and superannuation funds – to also invest in the program through the new lending market.
This funding agreement between RateSetter and the CEFC will operate in conjunction with an agreement between RateSetter and the South Australian government, in which RateSetter will be the exclusive administrator of the government’s $100 million Home Battery Scheme.
The Marshall Liberal Government welcomed the involvement of RateSetter and the CEFC in the home battery storage scheme.
“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,” said Minister for Energy and Mining Dan van Holst Pellekaan.
The P2P lender and the CEFC have been working together since May 2017, when the CEFC made a $20 million commitment to kick-start RateSetter’s Green Loan Marketplace for borrowers looking to buy or install energy efficient and solar products.
RateSetter says it has facilitated more than $370 million in loans to over 27,000 borrowers nationwide, with the amount funded each month growing by around 100% year-on-year. The South Australian Home Battery Scheme will support a further step-change in its growth.
“With a 237 % 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,“ RateSetter CEO Daniel Foggo says.
According to Foggo, 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.
“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,“ he says.
“We look forward to progressing a number of similar opportunities with the CEFC and other State Governments, so we can continue to open up simple, fast and affordable finance for renewable energy products and improve energy security for all Australians.”