Wind and solar currently power 8% of the world’s demand, could be 30% by 2035, a 7x increase in the size of the renewables market. Would cut coal’s contribution by 30%, almost obviate the need for new nuclear and eventually curtail gas.
Apex retained Cohn Reznick to find a buyer. Xcel and GIP shortlisted. Valued @ $400-500MM.
7 bidders for $4 BN NRG Energy assets. Lost $7 BN in 2 years. Including NEE, KKR, Blackstone, Borealis, John Hancock and GIP.
Enel secures $340MM tax equity provided by Allianz and MUFG. PPA with T-Mobile and Grand River Dam Authority. 300MW wind power.
Tool for mapping wind power in the US.
Solar PV industry could triple in size by 2022. In CA, solar energy is 10% of total generated energy.
Onyx Renewable raised $62.5 MM tax equity for 60 MW solar PV across 6 states. RBC created co-investment structure.
GE and Tesla install solar PV on 50 Home Depot stores and sell power to the host. Home Depot plans to get 135 MW of clean energy by 2020. Projects located in NY, NJ, CT, CA and DC. 6 projects will also get battery storage from Tesla.
Solar PV + Landfill Gas project.
LS Power finances 2 thermal power projects with a $415MM 7-year loan @ 325 bps. Banks BNP, CIT, DB, GE, ICBC, SunTrust, CoBank, DB and MUFG.
Calpine agreed to be acquired for $5.6 BN by a consortium of investors led by ECP.
Tax-exempt Energy Services Agreement to finance CHP installations at 60 Chicago buildings. No upfront cost and no economic risk for the city. Shares the realized electricity and natural gas savings. Sponsors Ameresco, Noresco, and Schneider Electric. Reduce annual energy usage by 18%. Piper Jaffray placement agent, BAML $12.2 MM 15-year tax-exempt debt @ 4.95%
Oil & Gas
Total acquired Maersk’s Oil & Gas business for $7.45 BN.
Oil prices are expected to decline in 2018.
Energy deals have picked up pace recently. Industry puts the worst of the slump behind it, although major oil companies like BP and Shell have tended to be sellers.
CEFC China in talks to acquire stake in Rosneft Russia oil & gas company.
Market reforms no evidence of adverse effects on the bond market. Less market participants and risk spread evenly. No material reduction in new issuances. US energy storage 565.5 MW. 22 companies own 45 storage systems in 12 states. 181.5 MW was added in 2016. Relatively less competition for acquisitions because utilities have a reduced appetite. Utilities have consumed a large amount of tax benefits over the last several years. Uncertainty on tax reform policy. Mezzanine debt attractive to replace equity but not debt. Common outside the US, limited opportunities inside the US. BHE cancels Salton Sea geothermal power project. Only 1 new geothermal project installed since 2000. Controlled Thermal plans to open new geothermal project in 2019 that extracts lithium from brine. Similar companies secured contracts from battery makers like Tesla but failed. SPAC Silver Run Acquisition Corporation invested $3.8 BN to combine midstream companies. Fossil fuels not burnt because of wind and solar helped avoid up to 12,700 premature deaths in the US between 2007 and 2015. US saved up to $220 BN. US likely spent up to $80 BN on subsidies for wind and solar. CIC (CIC.U) blank check company raised $350 MM in an IPO led by Citi, DB, and JPM. Grass clipping pellets from 100,000 acres owned by IL Department of Roads will be used to generate power for the public authority. Very large funds targeting infrastructure assets: