Large power companies understand the need to diversify, particularly during a time of rapid change. And for all but the most regressive among them, this means renewable energy.
Exelon represents this sector as much as any company, and is the biggest in the room with $33.5 billion in 2017 revenues. This includes not only 10 million customers through its various utilities, but also generation, and the company is the largest operator of nuclear power plants in the nation.
Given the inherent conflicts between nuclear power and variable renewable energy sources like wind and solar, one would be tempted to think that Exelon would stay away from renewables. However this is not the case, and in 2011 Exelon acquired energy producer, trader and distributor Constellation Energy, which also provides solar solutions for its commercial and industrial (C&I) customers.
Today Constellation and by extension Exelon announced that they have gone deeper into this market segment with the acquisition of solar developer PFMG Solar, which has built more than 100 MW of solar projects on schools, government buildings and other sites in California.
“This purchase is a natural expansion of our existing retail solar business,” said Constellation CEO Jim McHugh. “It enables us to grow our solar footprint in California, the most active U.S. solar market, and extend our Constellation Offsite Renewables (CORe), energy efficiency and other retail energy offerings to new markets.”
This is more of the evolution of a long-term relationship than a rush to a Las Vegas wedding chapel. Constellation notes that it worked with the developer on 42 MW of the projects that PFMG has developed, and says that PFMG has been a strategic channel partner for past five years.
The move also helps Constellation to drill down on California, which has been its most active state with 86 MW of the 360 MW that it has either completed or has under construction – although both Arizona and Maryland are not far behind, with over 80 MW each.
“The continued demand in California from our commercial and public sector customers to adopt on-site solar is an opportunity that we’re interested in expanding for years to come,” said Brendon Quinlivan, executive director of distributed energy origination for Constellation.
The electricity from many of Constellation’s projects has been sold through power purchase agreements (PPAs), and the company says that this is where both it and its customers see the most value.
Finally, it can be seen as part of Constellation’s rapid growth: of the 360 MW in the 11 years of its operation, the company has developed 150 MW since 2015.
Even this is a small volume compared to Exelon’s investments in nuclear. But like any good investor, or poker player, the company is hedging its bets.