NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to one note class issued by Sunnova Sol III Issuer, LLC, Series 2021-1. The transaction is secured by the equity interests of the managing members in the related Project Companies that in the aggregate, own a portfolio of 20,981 leases, power purchase agreements (“PPA”) (each a “Solar Service Agreement” or “SSA”), hedged solar renewable energy certificate (“SREC”) contracts, performance-based incentive (“PBI”) payments, and New Jersey’s transition renewable energy credit (“TREC”) payments, associated with residential solar photovoltaic installations (“PV Systems”) and battery units. Cash flow related to the portfolio is net of operations and maintenance expenses, administrative and insurance expenses, and any distributions to a tax equity investor per the organizational documents.
The SSAs had an aggregate discounted solar asset balance (“ADSAB”) of approximately $415.0 million while the hedged SREC contracts had an ADSAB of approximately $19.7 million, for a total ADSAB of approximately $434.7 million. The securitization’s share of the ADSAB is $417.5 million. The original term of substantially all of the SSAs is 25 years. The SSAs consist of approximately 17.5% PPA, 39.8% EZ Pay PPA, and 38.1% lease agreements, including storage leases, by ADSAB. As of the Cut-Off Date, the weighted average remaining term of the SSAs was 264 months and the weighted average FICO of the underlying customers of the PV Systems was 740.
- General Global Rating Methodology for Asset-Backed Securities
- Global Structured Finance Counterparty Methodology
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