Shell Bolsters Renewables Bet With Stake in U.S. Solar Company
(Bloomberg) -- Royal Dutch Shell Plc is investing in a U.S. solar energy developer, continuing its recent expansion into the electricity business.
The Anglo-Dutch oil and gas producer will acquire a 44 percent stake in Nashville’s Silicon Ranch Corp., which owns and operates about 100 solar facilities across the U.S. The investment could be as high as $217 million in cash, depending on the company’s performance, making Shell the largest shareholder, according to a statement.
Shell has been growing its foothold in the power business as it prepares for a carbon-constrained world, including an agreement to purchase the U.K’s seventh-largest utility in December. Rivals BP Plc and Total SA have also expanding into offshore wind and solar in the past few years, reflecting changing government incentives and customer demands.
“With this entry into the fast-growing solar sector, Shell is able to leverage its expertise as one of the top three wholesale power sellers in the U.S., while expanding its global New Energies footprint,” Marc van Gerven, Shell’s vice president of solar, said in the statement.
Silicon Ranch currently has about 1.9 gigawatts of solar-based power facilities in its development portfolio, and the Shell investment will allow it to enter new markets, according to the company. It operates in 14 states, including New York and California.
Shell is acquiring the stake from Partners Group, a Zug, Switzerland-based private markets investment manager. The deal is expected to close before the end of March.
©2018 Bloomberg L.P.