Denmark’s Orsted has agreed to buy a “significant” solar and storage pipeline in the US, as it continues its diversification into other renewables beyond its offshore wind core with the acquisition of the development unit of Coronal Energy.
Coronal is a California-based developer and power producer backed by Japanese giant Panasonic. Its development business is of “multi-gigawatt” scale and covers 20 US states, according to the Coronal website.
“The subsidiary is a nationwide solar and storage developer with a significant pipeline of solar and storage projects expanding our capability platform and exposure to new attractive regional markets,” Orsted said.
The Danish group had previously announced that it would seek to expand its base into wider green energy sectors.
The acquisition, for an undisclosed sum, also reinforces Orsted’s position in the US, where the company is active in offshore wind, and seperately in the onshore wind sector via Lincoln Clean Energy, which it bought last year and which will take on the Coronal operation.
Lincoln Clean Energy CEO Declan Flanagan said: “I am delighted to welcome the Coronal development team to LCE and the wider Orsted family. This experienced team complements our US development platform, greatly enhances our presence in solar and storage, and brings important new customer relationships through multiple long-term power purchase agreements both signed and in negotiation.”
Thomas Brostrøm, Orsted’s president for North America, said late last year that more acquisitions were on the cards.
“If you look at our balance sheet, it’s fair to say that it’s underused,” he said then. “We’ve made two acquisitions lately, so that helps, but we could use a little bit more leverage – and that’s part of our game plan.”
The announcement came as Orsted posted first quarter operating profits 7% lower at DKr5.1bn ($766m).
“The decrease was expected and was mainly due to a positive one-off compensation awarded following the completion of an arbitration case in Q1 2018 as well as cyclically lower earnings from our gas portfolio in Customer Solutions,” Orsted said.
“This was partly offset by a 13% increase in earnings from offshore wind farms in operation and earnings from our new onshore wind farms.”
Orsted yesterday took a final investment decision on 900MW of Taiwan offshore wind that had been on hold after a dispute with the government there over support arrangements.
Orsted CEO Henrik Poulsen said: "We remain very pleased with the operational and financial performance of the company as we continue to expand our position as a global leader in green energy."