Solar-panel manufacturer First Solar announced Wednesday it has signed a definitive agreement to purchase solar-project developer NextLight Renewable Power for approximately $285 million.
Subject to acquisition closing adjustments, the deal is to be all-cash and completed in third quarter. NextLight has a total of 570 megawatts worth of solar projects under way, with an additional 530 megawatts in various development stages, according to First Solar.
But NextLight, which was formed by the private equity firm Energy Capital Partners in 2007, has been putting together utility-scale solar installation projects and has connections outside its obvious existing portfolio that could benefit a photovoltaic solar systems manufacturer like.
California utilities will be. First Solar already has a relationship with . Buying NextLight will give it a relationship with one of the largest energy utilities in not only California, but the entire U.S.
In October, Pacific Gas & Electric signed an agreement with NextLight to purchase electricity through the 290-megawatt Yuma County, Ariz., solar farm Agua Caliente for the next 25 years. The Agua Caliente project under way has already been permitted and is approved to use either thermal solar or photovoltaic solar. PG&E also signed a deal to purchase electricity from the 230-megawatt solar farm AV Solar Ranch in Antelope Valley, Calif., which was also developed by NextLight.
NextLight's claim to fame is that it's also intimately involved and knowledgeable about one of the biggest obstacles in renewable energy: transmission.
A plethora of sun and available land has made the western U.S. an ideal spot for solar-energy projects. But the solar-farm sites can often be isolated from the electric grid. In addition to the regulatory hoops developers must jump through to get permission, the cost of building or connecting to transmission lines can make a project cost-prohibitive.
Owning a company with proven success over that hurdle would certainly help First Solar, who seems to be planning to offerlike those in the thermal solar sector have done.
"First Solar is uniquely positioned to deliver utility scale solar power plants including project development, module manufacturing, engineering, procurement and construction (EPC), project finance expertise and operations and maintenance," First Solar CEO Rob Gillette said in a recent statement.