Solar crowdfunding to top $5bn by 2020

Solar investment through crowdfunding is set to reach US$5 billion (£2.9 billion) over the next five years which is more than 50 times the amount raised to date, according to Tim Newell, vice-president of financial products at California-based SolarCity Corp.

Crowdfunding involves raising finance from a pool of investors and usually leverages online platforms.

The method has become increasingly popular in recent years as investors seek to beat low interest rates and have more control over where there money is being targeted.

Speaking at a Bloomeberg New Energy Finance summit this week in New York, Newell said, “This is ‘crowd’ with a capital ‘C’. Crowd isn’t a niche thing. It’s everything but that top handful of institutions.”

He added that a trend was being set whereby investors are putting their money into renewable energy through crowdfunding sites.

Newell was speaking at The Future of Energy Summit 2014 and said: “You’ll see a surprising amount of assets move through this channel in the next few years and we don’t say that just because of misguided optimism. We’re saying that because we take a hard look at it and spend a lot of time talking to investors.”

Last year a crowdfunding campaign in the U.S looking to finance four solar projects across the country raised US$313,000 (£194,000) in just 24 hours.

Similar projects have been just as successful in the UK. SunShare Community Nottingham managed to raise £500,000 in less than a month through a crowdfunding platform.