Solar energy and energy storage developer Recurrent Energy, a subsidiary of Canadian Solar Inc., announced today a $500 million commitment from BlackRock, with proceeds from the investment aimed at growing the company’s global renewable energy platform.
BlackRock’s $500 million preferred equity investment commitment, convertible into common equity, represents 20% of the outstanding fully diluted shares of Recurrent Energy on an as-converted basis.
Founded in 2006, Texas-based Recurrent Energy is a subsidiary of Canadian Solar Inc., is a global developer and owner of solar and energy storage assets, with 9 GWp of solar and 3 GWh of battery storage projects completed to date globally. The company also operates a power services business that manages more than 3.7 GW of operational projects under long-term operations and maintenance (O&M) agreements, with an additional 2.3 GW of contracted projects that will be operated and maintained by Recurrent Energy once they are operational.
According to the company, the new investment will provide Recurrent Energy with additional capital to grow its project development pipeline while executing its strategy to transition from a pure developer to a developer plus long-term owner and operator in select markets including the U.S. and Europe, providing a more diversified portfolio and more stable long-term revenue in low-risk currencies, while enabling the company to create and retain greater value in its own project development pipeline.
Ismael Guerrero, CEO of Recurrent Energy, said:
“We are delighted to have the support of BlackRock, one of the largest and most sophisticated renewable energy investors in the world, as we scale Recurrent Energy in response to massive global demand for renewable energy and energy storage solutions. This investment will support our growth and continued ambition to make a difference by leading the renewable energy transition across the world.”
BlackRock’s investment, made through a fund managed by its Climate Infrastructure business, marks the latest in a series of climate transition infrastructure-related moves by the firm, including the recent $12.5 billion acquisition by the firm of infrastructure investor GIP. BlackRock described infrastructure as a major source of investment opportunity in its recent 2024 Private Markets Outlook, released in December, driven by the low-carbon transition as a key mega-theme, and highlighting an upcoming “massive reallocation of capital” to rewire energy systems around the world.
David Giordano, Global Head of Climate Infrastructure and Chief Investment Officer of Transition Capital, BlackRock, said:
“Recurrent Energy is emblematic of our strategy of investing in leading renewable power generation assets and transition-enabling infrastructure, and we are pleased to make this first investment commitment from the fourth vintage of BlackRock’s Climate Infrastructure fund franchise.”
Canadian Solar will continue to own the remaining majority shares of Recurrent Energy after the closing of the investment.
Dr. Shawn Qu, Chairman and CEO, Canadian Solar, said:
“We are now at an inflection point for renewable energy growth. 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.”