The New York State Energy Research and Development Authority (NYSERDA) announced it has raised more than $24 million from revenue bonds it issued to finance consumer loans for residential energy-improvement projects.
NYSERDA issued the bonds through its Green Jobs-Green New York (GJGNY) program. The bonds closed on Tuesday, the Authority said in a news release.
The GJGNY program a statewide initiative to promote energy efficiency and the installation of clean technologies to reduce energy costs and greenhouse-gas emissions, support sustainable community development and create opportunities for green jobs.
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“The innovative approach used to secure these bonds addresses financial market barriers that impede the flow of private capital to support clean-energy projects and provides a potential national model for other states interested in providing low-cost financing for energy efficiency projects,” Francis Murray Jr., president and CEO of NYSERDA, said in the news release.
In what NYSERDA calls an “innovative effort” to ensure the success of the sale, Standard & Poor’s and Moody’s Investors Service have rated the bonds AAA/Aaa, based upon a guarantee from the New York State Environmental Facilities Corporation (EFC) through its state revolving-fund (SRF) program.
EFC manages the largest SRF in the nation with nearly $13 billion in assets and provides AAA-rated financial assistance to local governments and public entities to finance clean-water and drinking-water projects, according to NYSERDA.
EFC determined these bonds qualified for financial assistance under the Clean Water SRF because of the reductions in fossil-fuel combustion and related reductions in air pollutants into New York’s bodies of water.
“This collaboration between NYSERDA and EFC represents good government at its best because we are using EFC’s financial strength to support a sister agency in providing low-cost financing that will save homeowners money and reduce pollution in the environment,” Matthew Driscoll, EFC president and CEO, said in the news release.
Driscoll is a former mayor of the city of Syracuse.
The agencies sold the Qualified Energy Conservation Bonds (QECB) with an average term of about 6.8 years and an average interest rate of about 3.21 percent. Since the bonds provide a federal interest subsidy from the U.S. Treasury, their net interest cost is estimated to be about 0.48 percent.
Citigroup, Inc. (NYSE: C), Jeffries, LLC, and Samuel A. Ramirez & Co., Inc. are the underwriters for the financing, according to NYSERDA.
The agencies will use the proceeds of the bonds, which closed Tuesday, to replenish the $42.5 million GJGNY revolving-loan fund established under the Green Jobs-Green New York Act of 2009.
The QECB subsidy along with the EFC guarantee included in the announcement has enabled NYSERDA the ability to offer low interest rate GJGNY loans to consumers, it said.
Contact Reinhardt at ereinhardt@cnybj.com
