Duke Energy, a utility located in North Carolina has announced that its selling its unregulated utility-scale commercial renewables business to Canadian renewable asset operator Brookfield Renewable for $2.8 billion. The amount includes debt assumptions and non-controlling tax equity interests. Duke Energy Renewables, Duke Energy’s commercial renewables business, is a US-based developer and operator of renewable energy assets.
It has 5.9 GW of utility-scale solar, wind, and battery storage capacity that is operational or being built, as well as 6.1 GW of additional capacity in the pipeline. The acquired company’s principal activities will continue to be located in Charlotte, North Carolina. As part of the agreement, employees will join Brookfield. From the deal, Duke Energy will get net proceeds of $1.1 billion. The company intends to use these to improve its balance sheet and avoid the need for further company debt issuances. It will now focus on expanding its regulated companies and investing in grid reliability improvements.
Duke Energy has set an objective of adding 30 GW of regulated renewable energy to its system by 2035. The deal is expected to close by the end of 2023 after receiving regulatory approval. In terms of growth, Brookfield anticipates that the deal will boost funds from operations right away. Additionally, it announced an acquired auction and simultaneous private placement that are anticipated to generate $650 million in total equity proceeds.
REGlobal’s Views: This sale agreement includes a massive portfolio of more than 3,400 MW of utility scale solar, wind and battery storage across the U.S. Thus, with this acquisition, Brookfield will increase its market share in the US market significantly and cement its position as one of the leading players in the US renewable energy market.
