KBRA Assigns Preliminary Ratings to SHREC ABS 1 LLC, Series 2019-1

NEW YORK–()–Kroll Bond Rating Agency (KBRA) assigns a preliminary rating to two note classes issued by SHREC ABS 1 LLC. The securitization is backed by the proceeds from the sale of solar renewable energy credits, generated under The Connecticut Green Bank’s (the “Parent” or “Company”) Solar Home Renewable Energy Credit (“SHREC”) program, by the Parent to Connecticut’s two investor-owned utility companies, The Connecticut Light and Power Company, d/b/a Eversource Energy and United Illuminating Company under two Master Purchase Agreements, statutorily required by Connecticut. The SHRECs will be generated from solar photovoltaic systems (“PV Systems”) participating in the Parent’s Residential Solar Investment Program.

At closing the transaction will contain 14,038 PV Systems in the State of Connecticut that will generate the energy to be sold in the form of SHRECs. The Aggregate Discounted SHREC Asset Balance (“ADSAB”), calculated by discounting the quarterly estimated SHREC asset value starting on the first quarterly collection period following the cutoff date using a 7.00% discount rate, is approximately $20.1 million in Tranche 1 and $25.8 million in Tranche 2, for a total ADSAB of approximately $45.9 million. The original tenor of each Tranche is 15 years. The weighted average age of the PV Systems is 29 months.

Class     Rating     Initial Principal Balance
Class A Notes     A- (sf)     $36,800,000
Class B Notes     BBB- (sf)     $1,800,000

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KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

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