The essentials
- Crowdfunding presents a new model for public investment in large-scale renewable projects.
- Crowdfunding would allow businesses access to an estimated $2 trillion in capital from the general public. It has been successfully applied to financing utility- and commercial-scale solar projects by Mosaic, a California-based start-up company.
- Rewards-based crowdfunding (as opposed to “donation-based” crowdfunding) is the funding of a company or project by selling small amounts of equity to many investors with an expectation of return on investment.
- At this time, only residents of New York and California can participate in crowdfunding investments. However, the 2012 JOBS Act obligates the SEC to issue regulations allowing start-up companies to raise up to $1 million in capital via crowdfunding from the general public across the country.
- The new crowdfunding regulations will likely be issued in the third quarter of 2014.
- When crowdfunding regulations are issued, it will allow the general public to invest small amounts in renewable energy with a reasonable expectation of return on investment.