Recurrent Energy sells 235 MW-AC of solar power assets to Korean utility

The developer has sold off three large, operational solar plants to the Korea Electric Power Corporation, as parent company Canadian Solar moves into O&M.

March 13, 2018 Christian Roselund

A Recurrent Energy solar installation.

Image: Recurrent Energy

Canadian Solar is one of the world’s largest PV cell and module makers, and also has a strong presence in project development, which preceded its acquisition of San Francisco-based developer Recurrent Energy.

But while many other PV module makers-turned-developers then took the route of creating much-hyped yieldcos to hold completed projects – companies which they largely later dumped at low prices – Canadian Solar has been quietly building up operational solar assets.

As of the end of Q3 2017 Canadian had 1.4 GW of completed solar assets on its balance sheet, but that load will get a little lighter. This morning the company announced that Recurrent would sell three large solar plants – the Astoria 1 and 2 and the Barren Ridge – all of which are located in the dry lands of Southern California’s Kern County.

The Astoria Projects hold long-term power contracts with California utility PG&E, and the Barren Ridge with the Los Angeles Department of Water and Power. All three have been operational since late 2016, and are 60-100 MW-AC in capacity.

Recurrent’s sale of these projects does not mean that Canadian is retreating from the asset business – far from it. In fact, only a day before this announcement Canadian Solar announced that it will be opening a new arm to provide operations and maintenance services – with expertise no doubt developed from servicing its own assets. Unsurprisingly, Recurrent will continue to provide O&M for these three projects “as KEPCO transitions into its ownership role”.

This is KEPCO’s largest solar acquisition in the United States. The utility describes the purchase as a “strategic addition” to its renewable energy holdings, which will allow for diversification of its generation portfolio. KEPCO also says that it expects “further cooperation” with Canadian.

In making the purchase, KEPCO partnered with the Corporate Partnership (COPA) Fund, a Korean private equity fund. The company was advised by BofA Merrill Lynch and Scotiabank Global Banking and Markets.

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