EIB Group Backs Europe’s First Solar ABS with €100M Investment, Expanding Access to Affordable Clean Energy

EIB Group Backs Europe’s First Solar ABS with €100M Investment, Expanding Access to Affordable Clean Energy

(IN BRIEF) The European Investment Bank (EIB) Group has invested €100 million in Europe’s first public solar asset-backed securitisation (ABS) led by German green tech company Enpal. This groundbreaking transaction, valued at €240 million, enables Enpal to refinance residential solar loans, making solar energy more accessible for European homeowners. The EIB’s involvement as an anchor investor, along with a guarantee from the European Investment Fund (EIF), establishes a new asset class for renewable energy in the EU, supporting the goal of a greener, more integrated European Capital Markets Union.

(PRESS RELEASE) LUXEMBOURG, 15-Nov-2024 — /EuropaWire/ — The European Investment Bank (EIB) Group, in collaboration with its subsidiary the European Investment Fund (EIF), has invested €100 million to support the first public solar asset-backed securitisation (ABS) in Europe, led by German green tech company Enpal. This landmark transaction introduces a new asset class for renewable energy in the EU’s capital markets, setting the stage for affordable solar financing across Europe and furthering the EU’s Capital Markets Union goals for sustainable securitisation.

Enpal, a rapidly growing German firm specializing in integrated renewable energy solutions for residential customers, offers solar equipment, battery storage, electric vehicle chargers, heat pumps, and smart energy management—all available through flexible financing and maintenance contracts. The EIB, as an anchor investor, contributed €50 million, complemented by an additional €50 million embedded guarantee from the EIF, making this €240 million transaction viable in the European market.

This innovative financing model enables Enpal to refinance residential solar loans while making solar adoption more affordable for homeowners. By leveraging securitisation, similar to how auto loans were financed for consumers in the past, this transaction brings clean energy within reach of more private households, effectively reducing financial barriers to green energy adoption.

The structure of the deal, an ABS transaction, involved Enpal selling claims against customers—generated from the sale of 8,500 photovoltaic systems—to a Special Purpose Vehicle (SPV), which then placed €240 million on the capital markets. Solar ABS transactions are common in the U.S. but new in Europe; the EIB Group’s involvement establishes a foundation for a European green securitisation market.

EIB Vice-President Nicola Beer underscored the significance of the transaction, stating, “Small-scale renewable energy in homes is vital for reaching a net-zero economy. We are pleased to support innovative financial products that drive investment in this sector across Germany and the EU.” EIF Chief Executive Marjut Falkstedt added that the transaction strengthens climate action, marking an essential step for renewable energy solutions in residential settings.

Enpal Co-Founder Viktor Wingert highlighted the strategic importance of EIB and EIF backing, which signals market confidence and sets a precedent for similar transactions in Europe. By participating, the EIB Group is establishing trust in this new financial model and enhancing the liquidity and security of the transaction, marking a significant milestone for the European securitisation and renewable energy sectors.

Background information

The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality. The EIB Group, which also includes the European Investment Fund (EIF), signed a total of €88 billion in new financing for over 900 projects in 2023. These commitments are expected to mobilise around €320 billion in investment, supporting 400 000 companies and 5.4 million jobs. All projects financed by the EIB Group are in line with the Paris Climate Accord. The EIB Group does not fund investments in fossil fuels. We are on track to deliver on our commitment to support  €1 trillion in climate and environmental sustainability investment in the decade to 2030 as pledged in our Climate Bank Roadmap. Over half of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment.

The European Investment Fund (EIF) is part of the European Investment Bank (EIB) Group. Its central mission is to support Europe’s micro, small and medium-sized enterprises (SMEs) by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment and acts as EIB Group’s center of expertise for securitisation investments. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.

Enpal, the greentech unicorn in Germany, offers an integrated solution for renewable energy and is a pioneer in Germany’s energy transition. As a leading provider of solar and heat pump systems, the company has already integrated ca. 250,000 Distributed Energy Resources (DER) into the Enpal system. The PV system is part of an integrated energy ecosystem consisting of a battery storage system, an EV-charging station, a heat pump and the Enpal energy manager Enpal.One, an intelligent combination of hardware and software. Founded in 2017, Enpal has digitized and revolutionized the purchase of green energy for a fossil-free home with its rental model and flexible, no-down-payment purchase option. More than 80,000 Enpal-equipped households already make up our climate-friendly renewable energy community. Enpal’s investors include some of the world’s largest impact and technology investors, such as TPG Rise Climate, The Westly Group, Activate Capital, Softbank Vision Fund II, Princeville Climate Technologies, HV Capital, Team Europe, and Picus Capital.

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SOURCE: European Investment Bank