The Peck Company Holdings, Inc (NASDAQ: PECK), a leading commercial solar engineering, procurement and construction (EPC) company based in Burlington, has announced a new investment partnership designed to increase Peck’s access to capital for the construction of new solar projects and to scale its existing pipeline of new EPC business.
Peck has partnered with New York City’s GreenSeed Investors LLC and its affiliate GreenBond Advisors LLC to gain access to the rapidly growing Green Bond segment of the fixed income markets. Of note, this partnership provides Peck with access to project growth capital through additional EPC contract work from Green Bond proceeds while improving working capital and strengthening liquidity ratios.
The world is transitioning to renewable energy. For this transition to occur, new renewable energy infrastructure must be built. Green Bonds are the financial instruments focused on financing this transition, directing investor capital to the projects that are building this new infrastructure and delivering competitive returns to investors in the process.
The Peck Company Holdings Chief Executive Officer, Jeffrey Peck, said, “We are so pleased to announce this partnership on the 50th anniversary of Earth Day. We believe we are in the early innings of a renewable energy revolution. Over the next 50 years, we will help lead the transition to our renewable energy independence. By partnering with GreenBond Advisors and their affiliate companies, Peck will be able to tap the rapidly expanding Green Bond market for dedicated resources to fuel our organic growth and solar project acquisition strategy on a scale that far exceeds Peck’s current balance sheet capability. Now developers working with Peck can secure a pipeline of projects knowing that Peck can bring both the construction expertise and the capital with a certainty of funding that is required for rapid growth. Our shareholders should also recognize that this strategic partnership with Green Bond Advisors will support Peck’s growth with an additional source of revenue through EPC contract work while continuing to improve our working capital and strengthening our liquidity ratios.”
EPC (Engineering, Procurement and Construction) is a contracting arrangement in which the EPC contractor is made responsible for all the activities from design, procurement and construction, to commissioning and handover of the project to the end-user or owner.
William Dale, Chief Executive Officer of GreenBond Advisors LLC, commented, “In times of uncertainty, it’s good to remember that the sun will still shine, and that we’ll always need electricity. Green Bonds provide stable, secure investments that create jobs, strengthen America’s power infrastructure and ensure a cleaner, healthier environment for our communities. By partnering with Peck, we get an early look at the best solar projects in the market. These solar project assets are the backbone of our Green Bonds allowing us to provide stable, long-term competitive yields to our Green Bond investors. We believe that combining Green Bond financing directly with the construction capabilities of Peck offers a unique advantage as we transition our economy to renewable energy.”
Green Bonds are any type of bond instrument where the proceeds will be exclusively applied to eligible environmental projects and whose structure is aligned with the International Capital Markets Association’s “Green Bond Principals”.
They are regulated instruments subject to the same capital market and financial regulation as other fixed income securities.
Swedish investment bank SEB, underwriter of the first Green Bond in 2008, has forecast the Green Bond market will exceed $1 Trillion by the end of Q4 2020. Demand for these investment vehicles is significantly higher than what is currently available, resulting in repeated over-subscription for new Green Bonds and making Green Bonds an ideal vehicle for raising capital in the renewable energy sector.
GreenBond Advisors was recently formed to deliver financial product innovation into the Green Bond market. They have created a new Green Bond product that allows risk-adverse investment capital to be more easily directed into new green energy infrastructure development at an earlier stage of the project development cycle than is typically the case for existing Green Bonds.
This innovation by Green Bond Advisors will provide Peck with a strategic advantage in the marketplace as an EPC company, because Peck can bring a level of funding certainty to developers for early stage projects that will meet the project performance criteria.
Source: VermontBiz