Canadian Solar snaps up Recurrent Energy and big Australia solar projects

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Canadian Solar buys Recurrent Energy from Shap, including a 1,500MW portfolio of large scale solar projects in Australia.

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Canadian Solar has snapped up US-based solar project developer Recurrent Energy, picking up a sizeable portfolio in both the US and Australia of potential utility scale solar projects.

Canadian Solar will pay around $US265 million to buy Recurrent Energy from Japanese giant Sharp, which wants to focus its solar activities on the home and busirecurrentness, along with smart appliances and energy management systems.

The purchase gives Canadian Solar an added 4,000MW of large scale solar projects to add to its existing pipeline of 4,500MW. More than a third of this 4,000MW pipeline comes from Australia.

Recurrent Energy made headlines last year when it signed a power purchase agreement in Texas for less than US5c/kWh (add back a 30 per cent production tax credit to get the real cost).

It has another 1,000MW of projects in the US ready to go before that tax credit expires in 2016 – although President Obama has now proposed that the tax credit be made permanent.

Greentech Media noted that the acquisition seems typical of the ongoing trend among upstream solar manufacturers to move downstream and capture some of the value in installation and project development.

This charge, it said, was led by First Solar and SunPower, and later by MEMC’s acquisitions of SunEdison and Axio Power, as well as by Hanwha’s downstream plays.

Sharp bought Recurrent for $US305 million in 2010, but Deutsche bank says the knock-down price may be partly explained by Recurrent’s Australian portfolio, which has hit a virtual standstill – along with the rest of the industry – because of the Abbott government’s attack on the renewable energy target.

Recurrent Energy has around 1,500MW of projects in Australia, and suggested that there could be 2,500MW of large scale solar built in the country over the next five years.

However, last year, former country chief Colin Liebmann said the company would close its Australian office because of the policy environment, although the company has since insisted t is maintaining a presence in the country, if not a permanent office.

Deutsche Bank said in a note to clients on Wednesday that the issues in Australia may help explain the relatively low acquisition price of around 7 cents per watt of solar PV pipeline.

However, a spokesman said in an emailed statement that Australia remains an important part of Recurrent Energy’s plan to develop a “global network of clean power plants” servicing electricity retailers, government and commercial customers.

In Australia, it is particularly focused on 20MW to 100MW sized projects, and has a pipeline in Western Australia, Queensland and New South Wales on which its US-based team is activity working.

The 80MW Oakey project in south west Queensland is the most advanced to date.

 

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1 Comment
  1. lucyjunior 5 years ago

    More wakeup on how the coal infested Abbott Government is wrong tracking Australia.

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