Arquivos solar power generation

First R$200m already withdrawn by the company

09/12/2024

Ty Eldridge — Foto: Rogerio Vieira/Valor

Brasol, a renewable energy company primarily funded by BlackRock and Siemens, has announced its first issuance of simple debentures, amounting to R$400 million, to finance its growth plan through the construction or acquisition of new solar plants in the distributed generation segment.

CEO Ty Eldridge told Valor the focus is on infrastructure projects up to R$25 million targeting larger consumers such as industrial clients, telecommunications, and sanitation services. Bradesco BBI advised Brasol on the operation.

“The funds will be crucial for the development of strategic assets and new projects. This is also the reason for diversifying our solutions, as solar energy alone will not meet all of our clients’ needs. Hence, we are exploring battery storage solutions,” Mr. Eldridge added.

Despite the presence of numerous companies in Brazil’s distributed generation sector, the market is consolidating around a few key players acquiring projects, such as Brookfield, Origo, Matrix, and Patria.

At the end of 2023, BlackRock acquired a 45% stake in Brasol. With this investment, the plan is to allocate a significant portion of the capital for acquisitions, aiming for approximately R$1 billion in investments in the company. Brasol’s chief investment officer, Carlos Eduardo de Lima Bacha, noted that with BlackRock’s capital and other partners, along with the debenture issuance, the company now has the necessary funds to pursue these projects.

“We went to the market with a public operation and raised funds for Brasol, giving us discretion in allocating the money for future projects,” Mr. Bacha said. “Part of the funds will be used for purchasing equipment and constructing plants, as well as for consolidation through M&As [mergers and acquisitions],” he added.

The company currently has around 150 megawatt-peak (MWp) distributed across 22 states and aims to reach approximately 500 MWp of installed capacity by the end of 2025. The strategy involves utilizing Brasol’s equity, shareholder contributions, and other financial structures. The first R$200 million has already been withdrawn and is available for upcoming opportunities.

Recently, the company finalized an agreement to acquire solar farms from energy trader BC Energia. Initially, this partnership will involve controlling 13 projects with a generation capacity of 60 MW, requiring investments of R$250 million. The plan is to acquire 35 solar plants, demanding investments of R$800 million, as reported by Pipeline, Valor’s business news website.

This financial arrangement is not unprecedented. Raízen sold 31 solar projects to Élis Energia, a company controlled by Pátria Investimentos. Brookfield injected R$1.2 billion to establish a 300 MWp generation park through its subsidiary IVI Energia, with an undisclosed amount, and continues with the construction of future plants. Additionally, Origo Energia, backed by I Squared, raised R$600 million to finance the construction of around 150 small solar plants in 11 states.

Camila Ramos, CEO of Clean Energy Latin America (CELA), a consultancy specializing in the renewable energy sector, noted that remote generation projects have been using several financial instruments, including equity from investors, commercial and development bank financing, as well as capital market instruments such as Real Estate Receivable Certificates (CRIs) and credit rights investment funds (FIDC), simple debentures, and more recently, incentivized debentures.

“According to Cela’s annual survey of financing volumes for distributed generation in Brazil, this volume fell for the first time in 2023. However, in 2024, the financing market rebounded and is expected to show higher volumes than the previous year,” Mr. Ramos said.

*Por Robson Rodrigues — São Paulo

Source: Valor International

https://valorinternational.globo.com/

R$460m investment comes on top of previous R$1bn injection

08/01/2022

Surya Mendonça — Foto: Silvia Zamboni/Valor

Órigo Energia received an investment of R$460 million from the U.S. fund manager Augment Infrastructure with the objective of boosting distributed generation. The amount comes on top of another R$1 billion injection to reach an installed capacity of more than 250 megawatt peak by the end of 2022.

Augment became a major shareholder in the company, along with TPG ART, MOV Investimentos and Mitsui. The company does not reveal the share of the new partner but says that the U.S. fund will not take control of the company.

With this injection and debt raising, the company reaches R$2 billion of investments until the end of 2023 with 500 MWp. By 2024, with new funding planned, the goal is to reach R$4 billion invested and 1 GWp of installed capacity.

Órigo CEO Surya Mendonça knows that it won’t be easy, since the current backdrop of high interest rates makes it difficult to raise funds and the solar industry faces deep problems in its production chains, which have made the capital expenditure of the projects increasingly variable.

“This capital injection gives Órigo more autonomy to accelerate the construction of solar farms, continue investing in technology, and expand the service to new geographies,” says Mr. Mendonça.

He explains that the entry into force of Law 14,300/22, which establishes the legal framework for power self-generation, microgeneration, and distributed minigeneration, brought more security for new investors to invest in Brazil.

“This is a consequence of the attractiveness and predictability that the renewable sector has with the new distributed generation laws that were approved last year. So we see that in Brazil it is possible to attract foreign capital with good projects, a team, and growth plans,” he says.

The executive says that the company serves more than 50,000 customers with a current installed capacity of operational 150 MWp distributed in 40 small solar farms in Minas Gerais, Pernambuco, and São Paulo. The company wants to reach 500,000 customers in the Southeast, Central-West, and Northeast regions.

The strategy is well known and has been working well among companies focused on distributed generation, which means building small plants of up to 5 MWp, disposing of the energy on the grid, and selling quotas of the solar generation to customers. The idea is to direct 90% of the value to increase capacity. The remainder is spent on attracting customers.

In fact, this business model is what attracted the Investment Fund for Developing Countries (IFU), a Danish fund for developing countries that invests in Órigo through Augment. “IFU has made several investments in renewable energy in Brazil, and the investment in Órigo Energia represents our commitment to support the green transition in the country. Órigo has an innovative business model for the development of distributed solar generation sector in Brazil,” says IFU’s CEO Torben Huss.

*By Robson Rodrigues — São Paulo

Source: Valor International

https://valorinternational.globo.com/

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