Brookfield Renewable, in partnership with institutional investors, has announced its agreement to acquire Duke Energy Renewables, a leading developer and operator of renewable power assets in the United States. The deal, valued at $1.05 billion in equity proceeds (approximately $265 million net to Brookfield Renewable), will provide Brookfield with access to Duke Energy Renewables’ impressive portfolio of operating and under-construction wind, solar, and storage assets, totaling 5,900 megawatts, as well as a 6,100 megawatt development pipeline.
The acquisition positions Brookfield Renewable as one of the largest renewable energy platforms in the US. It will benefit from the supportive regulatory environment and the increasing demand for clean energy from commercial and industrial buyers. The cash flow generated by Duke Energy Renewables is expected to be immediately accretive to Brookfield’s Funds From Operations (FFO), with a minimum 3% accretion anticipated for 2024 FFO. Approximately 90% of the cash flows are already contracted, with a weighted average remaining life of 13 years and strong investment-grade counterparties.
Brookfield Renewable also sees the acquisition as an opportunity for near-term synergies. It plans to share platform costs within its existing business and leverage its relationships with major commercial buyers to secure high-value contracts for new developments and uncontracted volumes. Furthermore, the deal offers significant repowering opportunities, as Brookfield Renewable can utilize its experience in repowering wind projects to enhance the operating wind portfolio of Duke Energy Renewables.
The CEO of Brookfield Renewable, Connor Teskey, expressed enthusiasm about the acquisition, stating that it adds a significant renewable energy platform in attractive markets, contributes immediate cash flows, and provides potential upside through asset repowering and synergies. Following this acquisition, Brookfield Renewable’s operating and development assets in the US will reach nearly 90,000 megawatts, solidifying its position as one of the largest renewable energy businesses in the country.
To support its long-term growth targets, Brookfield Renewable has also recently completed a bought deal and concurrent private placement, raising $650 million in equity proceeds. The company aims to fund its growth through a combination of corporate debt, upfinancing existing hydro assets, and proceeds from asset recycling initiatives. With its current progress and the anticipated completion of various capital recycling initiatives, Brookfield Renewable remains confident in delivering double-digit annual FFO per unit growth in line with its track record.
