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Wall Street Sours on $9 Billion Mechanism for Green Projects

  • Yieldco shares largely haven’t recovered from turbulent 2015
  • Pension funds seek to acquire operating wind and solar farms
Wind turbines stand at a wind farm in Jeju, South Korea, on Wednesday, June 14, 2017. The election of Moon Jae-in as South Korea’s new president implies a shift in the nation’s approach to energy, as he supports policies that favor natural gas and renewables at the expense of nuclear and coal, according to Bloomberg New Energy Finance.
Photographer: SeongJoon Cho/Bloomberg
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Wall Street investors have gone cold on one of the main mechanisms banks invented to fund the green-energy revolution.

The business structure, known as the yieldco, feeds dividends from operating solar and wind farms to investors. Yieldcos raised $7.9 billion in public equity in 2014 and 2015 but only $1 billion since then, according to Bloomberg New Energy Finance.