KBRA Assigns Preliminary Ratings to Sunnova Helios XI Issuer, LLC Solar Loan Backed Notes, Series 2023-A

KBRA assigns preliminary ratings to three classes of notes issued by Sunnova Helios XI Issuer, LLC Solar Loan Backed Notes, Series 2023-A (“Sunnova 2023-A”), a $286.7 million residential solar loan ABS transaction.

The transaction is collateralized by approximately $491.3 million of residential solar loans. The $491.3 million residential solar loans in the statistical pool include PV Solar Loans under Sunnova’s Easy Own Plan Equipment Purchase (“Easy Own”) Agreements (72.7%), PV/ESS Solar Loans under its SunSafe Easy Own Plan Equipment Purchase (“SunSafe Easy Own”) Agreements (26.0%), and ESS Solar Loans under its SunSafe Agreements (1.3%). While Sunnova’s residential solar loan agreements offer 10- and 15-year loans, the majority of the pool (98.9%) has 25-year original terms.

Sunnova Energy Corporation (“Sunnova”, or the “Company”) is a Houston, TX based independent solar power company that provides low-cost solar electricity to homeowners, and a wholly owned subsidiary of Sunnova Energy International Inc. ("SEI"), a public company. The Company started its operations in January 2013 and began providing solar energy services under its first operating Photovoltaic (“PV”) System in April 2013. The Company has served a total customer count of over 279,000 in more than 45 U.S. states and territories.

KBRA applied its General Global Rating Methodology for Asset-Backed Securities and Consumer Loan ABS Global Rating Methodology, as well as Global Structured Finance Counterparty Methodology and ESG Global Rating Methodology, as part of its analysis of the transaction’s underlying collateral pool and the proposed capital structure. KBRA also conducted an operational assessment of Sunnova, as well as a review of the transaction’s legal structure and transaction documents. KBRA will review the operative agreements and legal opinions for the transaction prior to closing.

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Related Publications

• General Global Rating Methodology for Asset-Backed Securities
• Consumer Loan ABS Global Rating Methodology
• Global Structured Finance Counterparty Methodology
• ESG Global Rating Methodology

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. 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. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

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