Category: News

NextEnergy Capital continues investment charge with New York community solar portfolio purchase

Solar investor NextEnergy Capital (NEC) has continued its fledgling foray into the US solar market, completing on a string of community assets across New York.

NEC said NextPower III (NPIII), its third institutional solar fund, had established a new investment platform with investment partners and experienced solar developers in the US to invest some US$100 million into a portfolio of assets comprising around 100MW of solar PV.

The portfolio, yet to be completed, is expected to be operational within 18 months and consists of multiple sites located in the state of New York.

NEC will use equity from the institutional fund to finance the acquisition, with the assets benefiting from long-term fixed revenue from the state’s Value of Distributed Energy Resources mechanism, providing additional revenue over the course of 25 years.

The deal comes just days after NEC completed on a 36.1MW project in Mexico which Aldo Beolchini, the firm’s managing partner and chief investment officer, said was testament to its execution capabilities despite a “difficult business climate”.

“Our investment activities are proving to be quite resilient vis-à-vis the COVID-19 situation and we are on track to complete our investment programme,” he said.

NPIII’s current suite of solar assets either under construction or in operation has a combined capacity of 285MWp, however the fund also has a further ten projects under exclusivity, totaling in excess of 1GWp.

Lorena Ciciriello, managing director and head of debt financing at Next, said the company was expecting to raise more than US$200 million of debt and tax equity financing for its US community solar portfolio.

That commitment comes three months after the second close of NPIII raised a further US$118 million, bolstering its coffers to some US$280 million with a pipeline of assets totaling 2.5 – 3GW in its crosshairs.

Speaking to PV Tech after that raise, NEC chief executive Michael Bonte-Frieheim explained how assets across Europe, America and India were being targeted after the investor racked up a significant portfolio in the UK.

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Tesla to provisionally shutter Buffalo PV factory amid COVID-19 concerns

Silicon Valley giant Tesla has decided to temporarily close down factories in two US states after coming under fire over the exposure of its staff to the COVID-19 pandemic.

The firm will “temporarily suspend” production at its Gigafactory 2 solar cell and module plant in Buffalo (New York) and its electric vehicle facility in Fremont (California) over the next few days, according to a statement released by the company this week.

The provisional shutdowns will not be complete at either location, the statement suggests. Buffalo will remain operational “for those parts and supplies necessary for service, infrastructure and critical supply chains” while Fremont will retain certain “basic operations”.

“Despite taking all known health precautions, continued operations in certain locations has caused challenges for our employees, their families and our suppliers,” Tesla’s statement reads, adding that the move to retain partial operations “honours” the directions from the US federal government.

Tesla’s decision to stop production in New York and California – where its motor- and battery-making plant in Nevada will stick to business as usual for now – follows a controversy over its response to COVID-19 in California, so far amongst the US states most affected by the pandemic.

In recent days, US outlets had documented the widespread criticisms over Fremont’s continued operations despite the ‘shelter in place’ orders issued by county authorities. Tesla CEO Elon Musk’s Twitter remarks that “the panic will cause more harm than the virus” had stoked the controversy.

COVID-19 another setback after Panasonic’s Gigafactory 2 exit

The pandemic-driven winddown represents yet another setback for Tesla’s Gigafactory 2 plant, which it had scooped up through the SolarCity takeover in 2016. The project’s key partner, Japanese electronics giant Panasonic, decided last month to pull out from the venture.

The firm recently sought to spread good news about the Buffalo plant; last Sunday, it took to Twitter to report the factory had built 4MW of solar roofs in a week, “enough for up to 1000 [sic] homes”. Last month, it had emerged Panasonic staff at the plant will be assisted by the state to find new jobs.

In its first few months of existence, the escalating COVID-19 emergency has already had several ramifications for Tesla. A high-profile trial over its US$2.6 billion acquisition of SolarCity in 2016 was meant to continue this week but has been postponed, with no new dates yet within sight.

Contacted by PV Tech this week, a spokesperson from the Delaware Court of Chancery confirmed COVID-19 concerns were behind its decision to delay the trial pitting Musk and others at Tesla against a group of shareholders, who allege they were misled over SolarCity’s financial state.

The threat of litigation has coincided with a tanking of Tesla’s solar installations between 2017 (522MW), 2018 (326MW) and 2019 (173MW). The drop has seen the firm give up its spot as the top US residential solar installer, falling behind a bullish Sunrun.

In its statement this week, Tesla explained it held US$6.3 billion in cash at the end of Q4 2019, followed by its recent US$2.3 billion raise. “We believe this level of liquidity is sufficient to successfully navigate an extended period of uncertainty,” the firm said.

PV Tech has set up a tracker to map out how the COVID-19 pandemic is disrupting solar supply chains worldwide. You can read the latest updates here.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020)

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Lightsource taps BP and major banks to finance 260MW PV project in Texas

Lightsource BP has enlisted its oil major backer BP and some of the world’s largest banks to sponsor a large utility-scale solar project in Texas, with plans to deliver the plant by year-end.

The developer’s 260MW Impact Solar project in Texas’ Lamar County will be bankrolled by US$250 million in funding, co-provided between Lightsource BP itself, HSBC, NatWest and Bank of America.

The financial close comes after construction of the installation got underway some 120 miles to the northeast of Dallas, with commercial operation scheduled by the end of 2020.

According to a statement, BP – which late last year upped its stake in Lightsource BP from 43% to 50% – will acquire the plant’s output under a long-term trading arrangement with the developer. 

Meanwhile, the 260MW solar venture will benefit from a senior debt facility provided by joint lead arrangers HSBC and Natwest, with the former of the two taking on a coordinating role.

For its part, Bank of America will contribute by supplying tax equity financing towards the US$250 million package, negotiated with advisers from Norton Rose Fulbright (legal) and CohnReznick Capital (tax equity).

For London-headquartered Lightsource BP, the foray into US solar is the latest of a series.

In the past year alone, the group has closed financing for a 125MW four-state portfolio, broken ground on a 70MW Pennsylvania trio and announced plans for a 130MW venture in Alabama and a 240MW plant set to power a historic mill in Colorado.

Elsewhere, Lightsource BP has in recent times lined up finance to develop a 700MW global pipeline, scooped up a 1.9GW portfolio in Brazil from developer Enerlife and recently opted for a bifacial-plus-trackers approach for its first ever Spanish solar developments, a pipeline of 300MW.

For its part, oil giant BP has in recent weeks joined Repsol, Equinor and other majors in the sector in adopting targets to reach net-zero emissions by 2050, via a reorganisation of its core business areas amongst other measures.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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Coalition calls on US Congress to expand green energy incentives as COVID-19 sets in

Clean energy trade bodies and groups in the US have called on lawmakers to extend and improve tax incentives to help the renewable and clean grid industries surmount the COVID-19 pandemic.

The groups – which include the Solar Energy Industries Association (SEIA), the American Council on Renewable Energy (ACORE) and the Energy Storage Association (ESA) – wrote in an open letter on Thursday that supply chain disruptions and a drop in available tax equity will undermine renewable project finance, construction deadlines, as well as developers’ ability to meet tax credit deadlines and then monetise those incentives.

The coalition asked specifically for an extension of start construction and safe harbour deadlines, for provisions allowing renewable tax credits to be available for direct pay, and enactment of a direct pay tax credit for stand-alone energy storage.

“Like all sectors of our economy, the renewable and clean grid industry – including developers, manufacturers, construction workers, electric utilities, investors and major corporate consumers of renewable power – needs stability,” the letter to house and senate leaders notes. “The current uncertainty about the ability to qualify for and monetise tax incentives will have real and substantial negative impacts to the entire economy.”

For its part, the SEIA is currently carrying out industry surveys to better understand the impacts of COVID-19.

SEIA President and chief executive Abigail Ross Hopper wrote in an open letter on 12 March that the pandemic was “taking a toll on the industry”.

“We are getting reports from our members about supply chain disruptions, project delays, sales challenges and more. It is clear that companies will feel the effects of these market disruptions,” she wrote.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020)

Read PV Tech’s live compilation of how the pandemic is disrupting PV supply chains here.

Participate in the SEIA’s COVID-19 impacts survey here.

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US Solar Fund mulls further capital raises after IPO-funded PV acquisition spree

London-listed US Solar Fund (USF) has revealed that it has already fully committed the US$200 million raise from last year’s initial public offering (IPO), with proceeds funding four US solar purchases totalling 383MW.

The solar investor is considering raising further funds, according to 2019 financial results published on Tuesday, now that all four acquisitions have closed.

Between April’s IPO and the end of the year, USF acquired: A 128MW solar project in Utah with a 25-year PPA; a 39MW, 6-project portfolio of under-construction solar projects in North Carolina with 13-year PPAs; and a further 39MW portfolio of operating utility-scale PV plants in North Carolina, with 10-year PPAs.

On 31 December, the firm’s acquisition pipeline “represented a potential cash equity investment of US$1.9 billion and total capacity of 2,036MW,” according to a release that accompanied the company’s first ever year-end results.

In January, USF used the last of the IPO’s proceeds to purchase a 177MW portfolio of 22 utility-scale solar projects in North Carolina, Oregon and California from Heelstone Renewable Energy.

Gill Nott, chair of the company, said: “With contracted cashflows for an average of more than 16 years with investment grade off-takers, the investment manager is fully focused on delivering the portfolio’s long-term, stable, income objectives.”

Nott noted that the company would be “closely monitoring” the spread of coronavirus, but that “the majority of the equipment required for in-construction assets is either already in the US or is being manufactured there.”

The solar investor’s NAV per share stood at US$0.972 on 31 December, compared to US$0.979 on 30 June, a 0.7% drop.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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ReneSola eyes 1GW solar pipeline after refocusing on core markets

ReneSola has outlined its top country targets for solar growth this year, amid plans to add a fresh 1GW to its pipeline in the US and Europe in 2020 following its relocation to the former in 2019.

The small-scale specialist will zero in on the US (200MW), the UK (200MW), Spain (200MW), Poland (150MW), France (100MW), Germany (100MW) and Hungary (50MW) as it works to expand its global pipeline this year, according to full-year results released in recent days.

Once a solar manufacturer, ReneSola sold its dedicated unit in October 2017 to refocus on pureplay development. The firm pressed further ahead with its business repositioning in November 2019, when it moved its headquarters from China’s Shanghai to the US city of Stamford, Connecticut.

The new full-year results indicate the group has completed to date a 779MW solar portfolio worldwide. Some 216MW of that total are up and running plants, for the most part (172MW) distributed generation systems in its former home market of China.

ReneSola is however shifting its core business to the US, with a focus on segments – community solar, C&I – it believes are strong revenue-makers. The firm is eyeing a pipeline of 193.4MW nationwide, split between Florida (100MW), New York state (39MW) and others.   

In Europe, the current pipeline ranges from ground-mount systems in UK (90MW) and Spain (37MW) to feed-in tariff PV plays in France (42.5MW), Hungary (35.5MW) and Poland (19MW). These markets are, the firm said in a letter to shareholders, “strategically positioned for growth.”

EBITDA boosting and debt trimming for player in midst of refocusing

ReneSola’s full-year update did not only shed light on the firm’s core PV markets, but also the state of the finances that must be able to power growth across all markets.

The document records revenues of US$119 million across 2019, down from the US$150-170 million it was expecting but up from the US$96.9 million it posted in 2018. Guidance for 2020 indicates the group expects a certain dip in 2020, amid predictions of full-year revenues of US$80-100 million.

The firm also dipped into the red in 2019 with US$11.68 million in net income losses, following a positive figure of US$5.09 million in 2018. For its part, annual adjusted EBITDA saw a 2018-to-2019 25% jump from US$26.9 million to US$33.6 million.

In its letter to shareholders, ReneSola explained it worked last year to “optimize the profit potential” of its PV pipeline. The firm said it had to opt for project write-downs across “markets that were not economically viable”, following the cancellation of projects in China and the US. 

The results suggest a healthier balance sheet for ReneSola at the end of 2019, with more cash and cash equivalents in hand (US$24.29 million) than one year prior (US$6.7 million). Long-term borrowings also slimmed from US$41 million to US$3.3 million year on year.

Growth going forward will be steered by ReneSola’s relatively new management team. Together with its US relocation last November, the firm named Yumin Liu as new CEO – replacing predecessor Shelley Xu after a few months – and Ke Chen as new CFO.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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COVID-19 concerns spark delay for trial over Tesla-SolarCity tie-up

Court proceedings planned this week to examine whether Elon Musk and other leading Tesla figures misled shareholders over the SolarCity purchase have been postponed due to the COVID-19 crisis.

Contacted today, the Delaware Court of Chancery confirmed concerns around the spreading pandemic have prompted a decision to delay the trial pitting the firm’s CEO and others against a group of shareholders, who are highly critical of Tesla’s takeover of SolarCity in 2016.

The proceedings, said a spokesperson contacted by this publication, have been “postponed indefinitely, to a time to be determined, because of the virus”. The confirmation follows statements to this effect by court vice chancellor and case-presiding judge Joseph Slights, aired across various US media outlets.

Stressing that he was opting to postpone the trial “out of an abundance of caution,” judge Slights said: “Please know that this was not an easy decision to reach, given the time and resources I know you have dedicated to prepare for this trial, and the last minute nature of this decision.”

“We are expecting that more than 100 people may well gather in connection with this trial,” Slights said, in comments echoed by CNBC. “And while I certainly would not characterize this trial, or any other trial, as ‘non-essential,’ it is not expedited and no irreparable harm will flow from an adjournment.”

Allegations of information gaps prior to Tesla’s SolarCity buy

The court’s decision sees the COVID-19 emergency directly impact a court case first brought after November 2016, when 85% of the voting shares backed Tesla’s US$2.6 billion acquisition of solar roof specialist SolarCity.

According to court documents, the shareholders who challenged the takeover – their various lawsuits have been consolidated into the current case – claim the merger stemmed from a desire by Musk and others to save a “failing” SolarCity, ten years after it was founded by Musk’s cousins.

The shareholders allege Tesla withheld at the time information regarding SolarCity’s “true financial condition”, including liquidity constraints. They claim Tesla’s board was conflicted regarding the merger, and argue that Musk himself was involved despite claims he would recuse himself.

According to the court documents from February 2020, Tesla continues to argue that those accusing it have failed to produce evidence that Musk coerced stockholders into backing the merger. The vote of 2016 was, Tesla claims, a “fully informed” exercise by “disinterested” stockholders.

In recent years, the Silicon Valley firm had used similar arguments as it tried – and failed – to have the proceedings dismissed. As judge Slights said in last month’s Delaware court documents, the burden of proving that the SolarCity vote was fully informed “falls squarely on the board.”

Storage installs up, PV down after year of court controversies

Approached today, Tesla had not responded to this publication’s questions over the SolarCity trial by the time this article was published.

The court dispute is one of a series Tesla has had to grapple with in the last few months. Across 2019 alone, the firm faced a lawsuitlater called off – over PV blazes on Walmart rooftops and rows over unionising, with one case reportedly laying bare worries at Tesla’s top over profitability issues.

The firm has also seen trouble with the Gigafactory 2 factory in Buffalo, a solar cell and module production line it scooped up through the SolarCity takeover. Last month, it emerged its key project partner – Japanese giant Panasonic – had opted to pull out from the venture.

The wave of litigation has coincided with a tanking of Tesla’s solar installations between 2017 (522MW), 2018 (326MW) and 2019 (173MW). The drop has seen the firm give up its spot as the US top residential solar installer, falling behind a bullish Sunrun.

The Silicon Valley firm has witnessed, by contrast, growth in storage deployments between 2017 (429MWh), 2018 (1.04GWh) and 2019 (1.65GWh). The firm believes 2019 was a “turning point” and is now predicting, for 2020, a rise in PV and storage installs of “at least 50%”.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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New York opts for 1GW-plus of solar in annual RES procurement series

New York state has revealed it has awarded 17 new ground-mounted solar projects totalling 1,090MW, alongside 40MW of battery storage projects.

Last Friday, state Governor Andrew Cuomo identified the winners of New York Energy Research and Development Authority’s (NYSERDA’s) annual competitive procurement series, now in its third year, in his 2020 State of the State address.

Among the most ambitious projects selected under the 1,278MW round were a 200MW solar project backed by 20MW of energy storage and a standalone 180MW PV plant from NextEra Energy Resources; a 270MW plant backed by 20MW of energy storage proposed by ConnectGen; a 120MW solar facility backed by Boralex; and an 80MW PV plant from SunEast Tabletop Solar.

The remaining 12 PV projects were smaller, targeting 19.99MW or 20MW of capacity. Four wind projects also were awarded.

“The weighted average award price for this solicitation is US$18.59 per megawatt hour of production over the 20-year term of the awarded contracts, the lowest average award price resulting from a NYSERDA large-scale renewables solicitation in over a decade,” a government press release published Friday notes.

Some bids were 23% lower than the bids received in the 2018 series of the competitive renewables procurement programme, according to the release.

Construction is expected to start on some projects this year, and all are predicted to be operational by 2024, according to the government. NYSERDA and other state and local agencies will monitor development. 

The news heralds Canadian developer Boralex’s first foray into the US PV market. The company – headquartered less than two hours away from upstate New York in Montreal – won four projects in total.

“Not only was every project submitted selected, but the Boralex development team entered the New York market and took these projects from concept to today’s announcement in less than a year,” president and chief executive officer Patrick Lemaire said in a press release.

“These projects mark our very successful entry in the United States solar energy market and represent an important step in the achievement of our growth and diversification orientations of our strategic plan,” Lemaire added.

Cuomo: Raft of solar and PV projects key to “aggressive” climate change strategy

New York is targeting 70% renewable electricity generation by 2030, with 3,000MW of storage planned to balance the grid.

“New York continues to be a leader in developing large-scale renewable energy projects in a way that brings significant economic benefits and jobs to the state,” Cuomo said. “With these projects we will build on our aggressive strategy to combat climate change and lay a foundation for a more sustainable future for all New Yorkers.”

The press release claims that the state will invest US$1 billion in the projects, which will in turn spur 2,000 jobs and more than US$2.5 billion in direct and private investments.

Details about next year’s solicitation to come in April

The government said that NYSERDA will issue the next solicitation for large-scale renewable energy by 22 April.

“Maintaining a predictable pace of annual solicitations for renewable energy will support continued development and investment interest in New York state, and build on the state’s status as a leading market for renewable energy development in the US,” the press release notes.

NYSERDA has awarded more than 67 renewables projects in three years, which the government equates to 12% of the state’s electricity demand in 2030.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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Procedural row at US senate leaves bipartisan energy R&D act in limbo

The creation of a new hundred-million-dollar US solar innovation programme is to face delays, with the broader act paralysed as senators clash over the limits of committee jurisdiction.  

A row over individual amendments saw lawmakers at the US Senate Committee on Energy and Natural Resources vote 47 to 44 this week against the American Energy Innovation Act (AEIA), a sprawling 53-bill package including proposals to set up a new solar research scheme.

Contacted by PV Tech, a well-placed source said senators had no qualms over the substance of AEIA, jointly proposed last month by the committee’s Republican chair Lisa Murkowski and Democrat Joe Manchin. The committee had, the source noted, supported all 53 bills individually in the past year.

However, when all 53 were considered as a whole this week, a row broke out after some senators asked to vote on a specific amendment on hydrofluorocarbons (HFCs). The US Senate’s Environment committee – which holds jurisdiction over the HFCs proposals – refused to allow their inclusion in the Energy committee package, prompting some to vote down the entire act.

The rejection sets the scene for months of delays for the AEIA’s Solar Energy Technology Program, proposed alongside similar schemes for wind, geothermal, hydro power and others.

As proposed under the law, the Solar Program is designed to support areas including PV hybrids and solar manufacturing via grants, competitions and demonstration facilities. The activities would be funded through US$270 million allocated every year from 2021 to 2025.

Campaign to revive AEIA as Trump targets R&D funding

According to the US Senate source, talks are already underway behind the scenes to try and strike a new compromise on the HFC dispute, in a bid to free the entire AEIA package from paralysis. “[AEIA’s sponsors] are still trying but there’s not a concrete timeline on what that looks like yet,” they said.

However, the source noted, those pushing to put the act back on the legislative agenda will need the support of Senate majority leader Mitch McConnell. If McConnell does not agree to grant AEIA more time on the floor, its adoption could ultimately be delayed until 2021, the source said.

The hold-up of new US solar research programmes comes as pre-existing funding schemes are targeted by the Donald Trump’s administration.

The federal budget proposals unveiled by the president last month would halve financial support to energy research, in the process eliminating schemes the government believes are “costly, wasteful, or duplicative”, such as ARPA-E.

Despite the clampdown on future funding, the US Department of Energy has continued to launch rounds of solar R&D support – including a US$125.5 package last month – under its Office of Energy Efficiency and Renewable Energy (EERE). However, congressional Democrats have claimed already allocated EERE budget is being held back by the administration.

The controversy is one of many pitting Trump’s administration against green energy interests. The government has been accused of setting obstacles to solar through the adoption of Chinese import tariffs, while the Trump-appointed heads of federal energy regulator FERC have been urged not to “pad fossil fuel profits” by upholding certain state-level capacity market rules.

See here for more context on the AEIA and here for information on the solar R&D scheme. A breakdown for this week’s vote can be found here

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Goldman Sachs to invest US$275m in distributed solar JV

Goldman Sachs will invest up to US$275 million in a joint solar venture with Connecticut’s TELOS Clean Energy.

The JV, revealed via a press release on Tuesday, will develop, construct, own and operate distributed solar power projects for commercial, industrial and municipal customers.

The hundred-million-dollar investment from Goldman Sachs’ Alternative Energy Investment Group will finance the JV’s activities and be spent on purchasing assets. The funding will come from several sources, including debt, tax, equity and other sponsor investments.

Approached by PV Tech, a Goldman Sachs spokesperson declined to shed light on the targeted capacity, timeline and location of projects.

Vivek Kagazi of Goldman Sachs’ Alternative Energy Investment Group said the initiative was testament to the bank’s “commitment to investments in the distributed solar space”.

Turnkey renewables firm TELOS Clean Energy, which claims to have “executed hundreds of PPAs [power purchase agreements] nationwide” on its website, will manage the development and construction of projects.

Andrew Chester, TELOS Clean Energy CEO, said the cash injection would allow the firm to “scale and execute at pace”.

Chester was formerly partner and vice-president at Greenskies Renewable Energy, a Connecticut-based developer of community and commercial projects. He founded TELOS Clean Energy this month with former Greenskies Renewbale Energy business development manager Mike Daly, according to LinkedIn.

Greenskies Renewable Energy was purchased by US infrastructure fund JLC Infrastructure in January.

The prospects and challenges of solar’s new era in the US will take centre stage at Large Scale Solar USA 2020 (Austin, Texas, on 23-24 June 2020).

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