HASI Invests in 605 MW Renewables Portfolio Owned and Operated by AES
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Insights
The structured equity investment by HASI in AES's renewable energy assets represents a strategic move in the renewable energy sector, with potential implications for investor sentiment and market dynamics. The investment in a 605-megawatt portfolio of solar and solar-plus-storage assets diversifies HASI's holdings and strengthens its position in the market. This move may signal confidence in the long-term viability of renewable energy projects and their ability to generate stable cash flows, particularly given the weighted average remaining contract life of 16 years.
For stakeholders, the transaction suggests a robust partnership between HASI and AES, which could lead to additional collaborative opportunities. The focus on investment-grade off-takers also indicates a lower risk profile for the cash flows, which might be appealing to risk-averse investors. However, the reliance on a single operator, AES, for the management of the assets could introduce operational risk if AES encounters any performance issues.
The renewable energy sector is witnessing a significant transition, with increased emphasis on the alignment of energy supply with demand. HASI's investment in AES's renewable energy portfolio underscores the growing trend of energy companies investing in community solar and commercial & industrial solar assets. These investments are particularly noteworthy as they include a substantial component of battery energy storage, a critical element for addressing intermittency issues associated with solar power.
The geographical spread of the portfolio across 11 states and seven power markets enhances the resilience against regional market fluctuations and policy changes. This broad distribution also allows for a more nuanced understanding of different market dynamics and regulatory environments, which is essential for the long-term success of renewable energy investments.
This investment is indicative of the growing trend of sustainable investing, reflecting both HASI and AES's commitment to the energy transition. The inclusion of a large number of community solar projects within the portfolio aligns with broader societal goals of decentralized energy production and increased accessibility. It also reflects an understanding that investment in renewable energy can be both a business opportunity and a move towards corporate social responsibility.
Moreover, the focus on investment-grade off-takers for the portfolio's cash flows suggests a strategic approach to sustainability that prioritizes financial stability and risk management. Stakeholders interested in the environmental impact of their investments will likely view the long-term nature of these contracts and the associated stable cash flows as a positive development in the move towards a more sustainable energy future.
Pictured: Illustrative solar and solar-plus-storage projects included in the HASI and AES renewables portfolio. (Photos courtesy of AES)
Per the agreement, which reached financial close on December 22, 2023, HASI will make a structured equity investment in an approximately 605-megawatt (MW) portfolio of solar and solar-plus-storage assets spanning seven power markets and 11 states:
With a weighted average remaining contract life of 16 years, the portfolio's cash flows are contracted with a diverse group of predominately investment-grade corporate, utility, and municipal off-takers. AES will continue to own and operate the assets.
The transaction further expands the longstanding relationship between HASI and AES. In January 2023, HASI announced a common equity investment with AES in an approximately 1.3-GW portfolio of operating utility-scale solar and wind projects. Additionally, HASI and AES' clean energy business in the
“HASI is immensely proud to advance our partnership with AES with this latest transaction,” said Susan Nickey, Chief Client Officer of HASI. “Together, we share an unwavering commitment to accelerating the energy transition. AES’ exceptional leadership in closely aligning renewable energy supply with demand is precisely the focus our industry needs for the next phase of growth. This investment not only significantly expands our programmatic investment partnership but also offers diversification and scale to our balance sheet.”
“AES’ purpose is to accelerate the future of energy,” said James Marshall, Chief Financial Officer for AES’ clean energy business in the
About HASI
HASI (NYSE: HASI) is a leading climate positive investment firm that actively partners with clients to deploy real assets that facilitate the energy transition. With more than
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Media:
Gil Jenkins
media@hasi.com
443-321-5753
Investors:
Neha Gaddam
investors@hasi.com
410-571-6189
Source: Hannon Armstrong Sustainable Infrastructure Capital, Inc.
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