Canadian Solar Inc. (CSIQ), a leading solar energy company and global developer of solar and energy storage assets, announced today that its subsidiary, Recurrent Energy B.V., has successfully secured a $500 million preferred equity investment commitment from BlackRock. The investment, convertible into common equity, represents 20% of the outstanding fully diluted shares of Recurrent Energy on an as-converted basis.
The infusion of capital from BlackRock through a fund managed by its Climate Infrastructure business will provide Recurrent Energy with additional resources to bolster its high-value project development pipeline. Canadian Solar will retain the majority shares of Recurrent Energy, continuing to own the remaining stake after the completion of the investment.
Recurrent Energy, recognized as one of the world’s largest and most geographically diversified utility-scale solar and energy storage project development platforms, has a notable track record of developing around 9 GWp of solar and 3 GWh of battery storage power plants across six continents since its establishment in 2009.
As of September 30, 2023, Recurrent Energy’s global development pipeline includes 26 GW in solar and 55 GWh in storage, with 13 GW and 12 GWh respectively in projects with interconnections. The company anticipates having 4 GW of solar and 2 GWh of storage in operation in the U.S. and Europe by 2026.
The investment will facilitate Recurrent Energy’s transition from a pure developer to a developer plus long-term owner and operator in select markets, including the U.S. and Europe. This strategic shift aims to create a more diversified portfolio, ensuring stable long-term revenue in low-risk currencies and enhancing the value of Recurrent Energy’s project development pipeline.
The transaction encompasses various regions, including the U.S., Canada, Spain, Italy, the U.K., France, the Netherlands, Germany, South Africa, Brazil, Chile, Colombia, Australia, South Korea, and Taiwan. Notably, it excludes Canadian Solar’s project development business in Japan and China, along with certain assets in Latin America and Taiwan. The closing of the transaction is subject to regulatory approvals and specific terms and conditions outlined in the transaction agreements.
Dr. Shawn Qu, Chairman and CEO of Canadian Solar, expressed enthusiasm about the partnership, stating, “The infusion of capital from our partner BlackRock, who is also Canadian Solar’s largest institutional investor, will provide the resources needed to further scale the Recurrent Energy platform and meet record clean energy power demand across the world.”
Ismael Guerrero, CEO of Recurrent Energy, emphasized the significance of the investment, stating, “This milestone will help us continue to achieve our goal of delivering clean, reliable, and affordable power to the world, today and tomorrow.”
David Giordano, Global Head of Climate Infrastructure and Chief Investment Officer of Transition Capital at BlackRock, commented on the partnership, stating, “We believe this partnership will help unlock the full potential of Recurrent Energy’s impressive renewable energy project development platform.”
Solar energy is recognized as the most affordable means of electricity production globally, with the International Energy Agency projecting a nearly tripled global solar capacity between 2022 and 2027. The growth of renewable energy, particularly in the U.S. and Europe, is also driving demand for energy storage, with global cumulative deployments expected to exceed 1,000 GWh by 2030, according to Wood Mackenzie.
BofA Securities, Inc. and Banco Santander, S.A. served as financial advisors to Canadian Solar.
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