China Three Gorges Europe (CTGE), a subsidiary of China Three Gorges, which is among China’s largest clean energy operators, has signed a deal to acquire 500 MW of operational solar assets from X-Elio, a Spain-based renewable energy project developer. X-Elio is a 50/50 joint venture between US infrastructure fund KKR and Canada-based asset management group Brookfield Asset Management following an ownership shake-up which completed late last year.

The move will help the China-based company to build upon its existing European solar portfolio. CTGE currently holds assets in Portugal, Germany, the UK and Greece. Wu Shengliang, chairman at CTGE, described the deal as a “landmark transaction” for the group, adding his belief that Spain is currently the most thriving solar market. China Three Gorges owns renewable energy assets with a total generating capacity in excess of 75 GW, although that consists mostly of hydropower assets in its native China.

The deal, which remains subject to regulatory approvals, will see X-Elio reduce its presence in Spain, but it will continue to hold around 2 GW of assets in its home market and Lluis Nogeura, chief executive at X-Elio, reiterated the firm’s commitment to the country’s solar market. “The Spanish government’s renewable objectives are going to be critical to revitalise the Spanish economy through jobs creation and improvement of the competitiveness of energy costs after the current COVID-19 crisis. These policies are clearly increasing the appetite from top tier international power generation investors like CTGE,” he said.

REGlobal‘s Views: The expansion into Spain follows CTG’s purchase of a 23 per cent stake in Portugal’s largest utility EDP-Energias de Portugal. The move may provoke concerns over China’s growing influence in the sector, especially in the US and Europe.