NextEra Energy announced yesterday one of its subsidiaries agreed to sell two long-term renewable assets portfolios for $1.3 billion total.
These agreements will sell 90% and 100% of the interest in 1 gigawatt (GW) and 100 megawatts (MW) of assets, respectively, to the company’s affiliate Next Era Energy Partners, and a consortium of private investors led by KKR.
The agreements
Next, Energy will sell a 90% stake to NextEra Energy Partners. This agreement comprehends four solar Energy and three wind energy assets in Texas, Oklahoma, Kansas, Florida, Arizona, and Maine. Their generation capacity is up 1 GW totally.
The company will retain a 10% interest. The subsidiary purchaser, NextEra Energy Partners, will acquire a 40% interest, and the KKR-led group will have the other 50%.
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Furthermore, NextEra Energy has the right to repurchase a 50% interest from KKR’s part if it decides to sell in the future.
On the other hand, the company will sell a 100% interest in a 100 MW solar power facility in Arizona. The asset includes 30 MW of battery storage. Therefore, this portfolio will be purchased by NextEra Energy Partners.
NextEra Energy goals
Overall, the company will use these agreements to help finance its 15 GW development project backlog.
Such projects would require $1.3 billion cash and are expected to become the company’s most extensive renewable portfolios.
In that regard, this will be a capital recycling decision since the purchases’ funds will be used for new solar, wind, and battery storage projects.
The agreements are expected to be completed by the last quarter of 2020. Some customary closing and clearance conditions will be necessary for that.
NextEra Energy will also receive an ongoing and escalating annual fee income of approximately $7 million over the operating life of the assets. The company will continue providing operations, maintenance, and management services.
10% interest retainment – Portfolio details
The portfolio, in which NextEra Energy Resources will retain a 10% equity interest, includes:
- Blue Summit III Wind Energy Center: 200.2-MW – wind generation – Texas.
- Ponderosa Wind Energy Center: 200-MW – wind generation – Oklahoma.
- Harmony Florida Solar Energy Center: 74.5-MW – solar generation – Florida.
- Taylor Creek Solar Energy Center: 74.5-MW – solar generation – Florida.
- Saint Solar Energy Center: 100-MW – solar generation – Arizona.
- Sanford Airport Solar Energy Center: 49.4-MW – solar generation – Maine.
- Soldier Creek Wind Energy Center – 300.4-MW – wind generation – Kansas.
NextEra Energy Partners’ acquisition will include a 100% interest in the Wilmot Solar Energy Center (100-MW solar and 30-MW storage generation facility in Arizona).
