This proposal aims for KlimaDAO to deposit $250,000 into Helios, a liquidity provider for solar projects. The deposit will grant KlimaDAO access to an 8-10% yield generated from solar installations, aligning with our mission to accelerate climate finance.
KlimaDAO's core objective is to create a transparent, neutral, and public infrastructure to accelerate climate finance. Helios offers a unique opportunity to diversify our DAO holdings with renewable energy, specifically solar installations, while generating a stable yield. This partnership will not only provide financial returns but also contribute to global sustainability.
- KlimaDAO to deposit $250,000 into Helios, with a 6-month lock-up.
- The funds will be used to finance the construction and operation of solar installations.
- KlimaDAO will receive an 8-10% yield from the sale of clean energy generated by these installations.
Helios is an open-source platform enabling both web3 & traditional investment in profitable, high impact solar projects in emerging markets, earning users stable, double digit yields uncorrelated with crypto or public markets while averting millions of tonnes of CO2 emissions each year.
- By funding Commercial and Industrial (C&I) solar in emerging markets, Helios users achieve up to 10x more environmental impact as compared to funding similar US-based solar projects.
- Less than 10% of proposed solar projects pass Helios’ meticulous diligence process, ensuring only the highest quality projects backed by top solar developers and established (10+ year track record) counterparties around the world.
- In Helios’ first year of operation, they funded 4 solar projects across India, achieving an impressive 12.4% IRR while averting 900t of CO2 emissions. Now approaching their third year with nearly $1m under management, Helios is expanding globally with new projects coming online in Mexico, Brazil, Chile, and Zambia by end of Q1 2024.
- Helios is currently undergoing an audit by web3’s most trusted audit firm, Trail of Bits, before launching publicly on Coinbase’s Base chain in Q1 2024.
- The Helios project is fully bootstrapped with generous funding provided by Gitcoin, Future Quest, Celo, and NEAR. Taking no salaries, all Helios contributors are mission-driven by the clear goal of funding as much solar as possible. By eschewing traditional VC funding, Helios can fully decentralize ownership of the protocol, ensuring that the mission to fund solar can never be halted by short-term profit-seeking financiers.
Risks and Mitigations
Default on PPA: Helios mitigates this risk by working exclusively with well-capitalized businesses and has legal recourse in the event of a default.
Operational / Performance Setbacks: Helios uses cutting-edge technology for 24/7 oversight and works with top solar developers to ensure peak performance.
Project Pipeline: Helios maintains a strong pipeline of projects exceeding $150M, ensuring long-term success.
Liquidity / Bank Run: Helios has a multi-layered strategy to ensure liquidity, including large capital providers and a cushion of funds from solar installation repayments.
Crypto Asset Risk: Deposits are only accepted in stablecoins, primarily USDC, to avoid volatility.
Smart Contract Risk: Helios uses battle-tested open-source components and is in the process of auditing their contracts.
Emerging Market Risks
Currency Risk: Helios uses currency hedging contracts to mitigate this risk.
Government: Helios limits government exposure by working solely with private enterprises.
Repatriation: Helios owns LLPs in target countries to ensure smooth repatriation of funds.
Further examine the risks here.
Helios is a liquidity provider for solar projects that allows users to fund solar installations and earn yield from the sale of clean energy. The protocol is designed with aligned incentives; directing liquidity toward financing profitable, high-impact solar installations. Helios makes money from funding these installations, just like its users, ensuring that all stakeholders are working toward the same goal: funding as much solar as possible.
Read more here.
We invite the KlimaDAO community to seize this unique opportunity to diversify its portfolio into renewable energy while generating a stable yield. By voting "For," you're not just making a financially sound decision; you're actively contributing to global sustainability and accelerating climate finance. Let's leverage this partnership to make a lasting impact—both for KlimaDAO and for the planet.
The discussion will last until November 2nd, at which time, if positively received, this RFC will be escalated to a KIP.