Hannon Armstrong eyes 49% stake in 18 AES solar and wind farms after twin investments
The common equity transactions cover a 1.3GW portfolio that includes facilities across six US states including Arizona, California and New York
Hannon Armstrong Sustainable Infrastructure Capital has closed two investments in a 1.3GW portfolio of grid-connected US solar and wind projects owned by power and utility company AES with the intention of acquiring a 49% equity interest.
The projects are in Arizona, California, New York, South Dakota, Utah, and Virginia. With a weighted average 18-year remaining contract life, the portfolio’s cash flows are contracted with a diverse group of predominately investment-grade corporate, utility, and municipal off-takers. AES will continue to majority own and operate the assets.
Hannon Armstrong, a real estate investment trust (REIT) based in Annapolis, Maryland, did not quantify the investment. It is also financing land owned by AES for a solar project and a standalone battery energy storage system in California.
Manny Haile-Mariam, managing director of Hannon Armstrong, said the additional solar and storage land financings build on the five-year track record of solar land transactions with AE’ clean energy business in the US.
“These senior-level land financing and common equity transactions with AES are a great example of how we help solve the multiple investment needs of our clients, all transacted with an integrated team,” he said.
Hannon Armstrong claims to be the first US public company “solely dedicated to investments in climate solutions” developed or sponsored by industry pacesetters in the energy efficiency, renewables, and other sustainable infrastructure markets.
It has boosted its profile in the last several years with the surge in corporate environmental, social, and governance (ESG) investing. Aside from providing equity and loans, Hannon Armstrong’s investments include joint ventures, land ownership, and other financing transactions.
The company also generates ongoing fees via off-balance sheet securitisation transactions, advisory services, and asset management.
AES through its clean energy division owns and operates biomass, energy storage, hydro, landfill gas, solar, and wind power in the Americas, Asia, and Europe. Renewables comprise about 42% of AES’ 31.37GW of generating capacity worldwide, with the balance coal, natural gas, petroleum coke and fuel oil.
“AES is committed to accelerating a greener, smarter energy future,” said Leo Moreno, president of AES Clean Energy. “This investment creates an opportunity to expand our development of renewable energy projects, growing our portfolio of wind, solar and battery energy storage facilities across the US.”
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