WATCH: Massive Mustang solar project comes together, ready for commercial operation

The Mustang solar power project in Kings County, Calif., is massive (100 MWac/134 MWp) and ready for commercial operation, says  Recurrent Energy, a wholly owned subsidiary of Canadian Solar Inc., one of the world’s largest solar power companies.

“The commercial operation of the Mustang solar project continues a historic year that will see Recurrent Energy complete more than one gigawatt of U.S. solar photovoltaic (PV) projects,” said Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar.

In 2015, Recurrent Energy secured a tax equity investment commitment for the Mustang project from U.S. Bancorp Community Development Corporation (USBCDC).

The renewable energy generated by the Mustang project will be sold under long-term power purchase agreements to Sonoma Clean Power and MCE. The project is expected to produce enough electricity to power approximately 45,000 homes.

Construction of the 1,000 acre project created 450 peak construction jobs. Blattner Energy served as the provider of Engineering, Procurement, and Construction services.

RELATED: The value of a team approach to fixed-tilt ground-mount projects 

— Solar Builder magazine

Solar industry’s total 2015 corporate funding exceeds $25 billion

solar corporate funding

Mercom Capital Group LLC, a global clean energy communications and consulting firm, released its report on funding and merger and acquisition (M&A) activity for the solar sector in 2015. Total global corporate funding in the solar sector, including venture capital/private equity (VC), debt financing, and public market financing, raised by public companies came to $25.3 billion, compared to $26.5 billion in 2014.

“Overall it was a good year for the solar sector considering the turbulence in the stock markets and trouble with yieldcos in the 2nd half of the year,” said Raj Prabhu, CEO of Mercom Capital Group. “The extension of the Investment Tax Credit (ITC) was a much needed boost for the sector, paving the way for a strong 2016.”

solar mergers and acquisitions

Global VC investments came to $1.1 billion in 83 deals in 2015, compared to $1.3 billion in 85 deals in 2014.

solar corporate funding

Solar downstream companies accounted for 69 percent of the VC funding in 2015, with $727 million of the $1 billion raised. Investments in PV technology companies came to $173 million and Balance of Systems (BoS) companies raised $87 million. Thin-film companies brought in $44 million, service providers raised $15 million, and the CPV and CSP categories each raised $3 million. Over $100 million in VC funding went to companies focused on off-grid markets in Africa, India, and South Asia.

RELATED: Average residential solar prices $3 to $4 per watt, commercial $2 to $3 

Among the Top 5 VC deals in 2015, the largest was the $300 million raised by Sunnova Energy, followed by the $105 million raised by Silicor Materials. Sunlight Financial raised $80 million and Sungevity raised $50 million. Completing the Top 5 was Conergy, which raised $45 million.

solar 2015 funding

There were 109 active investors in 2015 with 14 involved in multiple rounds. The 14 were DBL Partners, Infuse Ventures, Bamboo Finance, Clean Energy Venture Group, DOEN Foundation, ENGIE Rassembleurs d’Energies, Hudson Clean Energy Partners, International Finance Corporation, Kohli Ventures, Longwall Venture Partners, MTI Partners, Parkwalk, Tenaska and University of Oxford.

Despite a weak fourth quarter, public market financing had its strongest year with almost $6 billion raised in 38 deals, compared to the 2014 record of $5.2 billion in 52 deals. There were seven IPOs bringing in a total of more than $1.8 billion including Sunrun, Xinte Energy, CHORUS Clean Energy, SolarEdge Technologies and Grenergy Renovables. Yieldcos raised $1.1 billion in two IPOs, TerraForm Global Yieldco and 8point3 Energy Partners.

Debt financing in 2015 totaled $18.3 billion, slightly down compared to $20 billion in 2014. More than half of the debt funding raised came from China, $10.9 billion in 33 deals. There were four securitization deals in 2015, totaling $335 million, by Solar City, SunRun, BBOXX and AES.
Announced large-scale project funding in 2015 exceeded $11.6 billion in 124 deals this year, compared to 2014 in which $14.2 billion was raised in 144 deals. A total of 145 investors funded about 6.6 GW of large-scale solar projects this year.

solar industry investment

Top investors were Santander with 12 projects, Rabobank with nine projects and CIT Bank, Credit Agricole and KeyBank with six projects each.

It was a record year for dollars raised in residential and commercial solar project funds in 2015 with 23 funds announced for a combined total of $5.5 billion, compared to the $4 billion raised in 34 funds in 2014. SolarCity, Sungevity, Onyx Renewable Partners, Sunlight Financial, Brite Energy and Kilowatt Financial were top fundraisers in 2015.

“With the ITC extension, we predict third-party owned financing companies will continue to raise residential and commercial funds in large numbers,” commented Prabhu. Since 2009, third-party owned financing firms offering lease, PPA and loans have raised more than $17 billion.

RELATED: Top U.S. companies increase solar installs by 59 percent 

Corporate M&A transactions in the solar sector in 2015 came to more than $3 billion in 80 transactions, compared to 116 transactions in 2014 for over $4 billion. Solar downstream companies had the greatest number of acquisitions with 49 transactions. SPI Solar acquired four companies and Global EcoPower acquired three companies. The largest disclosed transaction was the $1 billion acquisition of an 80 percent stake in Gestamp Asetym Solar from Gestamp Renewables by KKR, an investment firm.

There were a record 204 large-scale solar project acquisitions for over 12.7 GW, double that of 2014 where 6.4 GW changed hands in 163 transactions. Spurred by yieldcos, 2015 has been by far the best year for solar project acquisitions.

solar industry transactions 2015

Mercom also tracked 373 large-scale project announcements worldwide in Q4 2015 totaling 12 GW and 1,118 project announcements totaling 41.1 GW for 2015 in various stages of development globally.
To learn more about the report, click here.

— Solar Builder magazine

Recurrent Energy, Southern Power take charge of 200-MW Tranquility project

Canadian Solar announced that its wholly owned subsidiary, Recurrent Energy, one of North America’s largest solar project developers, signed an agreement with Southern Power for Southern Power to acquire a controlling interest in the 200-MW Tranquillity Solar Power Project in California. The project, developed by Recurrent Energy, is currently under construction.

canadian-solar-logoUnder the terms of the agreement, Southern Power will acquire approximately 51% of the solar generation project. Canadian Solar will retain 49% ownership and contribute its share of the investment required to complete the construction of the project, which the company has fully financed through a construction and back-leveraged loan facility with a syndicate of six banks.

The Tranquillity project, covering an area of 1,900 acres in Fresno County, is expected to reach commercial operation in the fourth quarter of 2016 with Signal Energy Constructors as the provider of engineering, procurement and construction services. The project is expected to generate enough clean solar energy to power approximately 55,000 homes. The electricity and associated renewable energy credits (RECs) generated by the facility will be sold to Southern California Edison under a 15-year power purchase agreement.

“The Tranquillity project is an attractive opportunity for investors, providing long term stable cash flows,” said Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar. “This transaction is another example of solar power’s move into the mainstream energy mix, and it shows our broader team’s ability to attract top notch investors to finance our high-quality projects.”

Recurrent Energy has more than 4 GW of solar projects in development in North America.

More solar utility development news? Sure thing.

— Solar Builder magazine

Canadian Solar Expands Project Pipeline with $265 Million Acquisition

canadian-solar-logoCanadian Solar Inc., has entered into a definitive agreement with Sharp Corporation to acquire solar energy developer Recurrent Energy LLC, for approximately $265 million.

Once completed, the acquisition of Recurrent will increase Canadian Solar’s total solar project pipeline by approximately 4.0 GW to 8.5 GW, and its late-stage project pipeline by approximately 1.0 GW to 2.4 GW.

Located in California and Texas, Recurrent’s 1.0 GW late-stage pipeline is one of the largest utility-scale project portfolios scheduled to be built prior to the ITC expiration in 2016, and represents an estimated revenue opportunity of at least $2.3 billion for Canadian Solar under a build and sell business model.

“The acquisition of Recurrent is an important milestone for us as it significantly expands and strengthens our position in the North American market, and places Canadian Solar firmly among the leading global solar energy companies,” said Dr. Shawn Qu, Canadian Solar chairman and CEO. “By combining Canadian Solar’s global reach and experience with Recurrent’s proven solar energy development track record in the U.S. and Canada, we are significantly expanding the scale of our solar energy development platform. At the same time, this transaction broadens our strategic options to extend our business model from development and construction into potential ownership and operation of solar power plants as we work to create additional value for our shareholders.”

The transaction is expected to close prior to the end of the first quarter of 2015, subject to customary closing conditions and regulatory approvals.

The transaction further expands Canadian Solar’s position as a leading solar energy developer, with a globally diversified project pipeline in low risk geographies. In addition, this transaction broadens Canadian Solar’s project development and financing capabilities, and enhances the company’s position for creating its own Yield-Co in the quarters ahead.

“Canadian Solar is a key player in the industry and we are fortunate that our collective visions for the future of the solar market are very much aligned,” said Arno Harris, Recurrent Energy CEO. “We look forward to close collaboration with our new parent company to bring solar power further into mainstream energy markets.”

Credit Suisse acted as sole financial advisor and Foley & Lardner LLP acted as legal counsel to Canadian Solar. Scotia Capital (USA) Inc. acted as lead financial advisor to Sharp Corporation and Recurrent. The Bank of Tokyo-Mitsubishi UFJ, Ltd./MUFG Americas also acted as financial advisor to Sharp Corporation. Orrick, Herrington & Sutcliffe LLP acted as legal counsel to Sharp Corporation.

For more information on Canadian Solar, follow this link.

— Solar Builder magazine