Filed under: Deals, Venture capital industry, Private equity industry, Investments
This morning there was a rather interesting private equity venture. The AES Corporation (NYSE:AES) and Riverstone Holdings LLC, a New York-based energy and power-focused private equity firm, have announced that they have committed up to $1 billion as part of a new joint venture. This joint venture will develop utility-scale solar photovoltaic (PV) projects. Translation: big projects for communities more than small individual projects. This deal isn’t one-of-a-kind, but it is rather unusual for traditional private equity.
This will be called AES Solar, and AES and Riverstone will each provide up to $500 million of capital over five years to invest in PV solar projects globally. This follows the traditional independent power producer and wind business growth models noted geographically with favorable tarrifs and incentives. AES also noted that alternative energy currently accounts for 20% of its global generation capacity. The joint venture will be managed by a seven-member board of directors and three directors each will be appointed by AES and Riverstone. It noted that the target is for power grids that range from two to fifty Megawatts in size.
This is not the first such venture in the sector, but this is a rather massive commitment in the current environment. This nearly sounds like chasing a hot sector after the likes of Al Gore’s deeper involvement in investing in the sector from November. It also seems more “VC-esque: than traditional private equity. The lines between private equity and venture capital may be blurring further as capital competes for more deals.
Riverstone has invested in other green and traditional ventures, and here are its other portfolio companies.
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