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TotalEnergies acquires 50% stake in Clearway Energy Group

TotalEnergies acquires 50% stake in Clearway Energy Group
Photo courtesy of Clearway Energy

French energy company TotalEnergies has agreed to acquire 50% of Clearway Energy Group (CEG), the fifth U.S. renewable energy player, from Global Infrastructure Partners (GIP). 

The move represents TotalEnergies’ largest acquisition in the renewable energy industry in the United States, one of the top three renewable markets in the world. The transaction further accelerates TotalEnergies’ growth in the renewable energy sector by partnering with GIP, a leading global infrastructure fund.

Clearway Energy Group is a developer of renewables projects and controls and owns a 42% stake in its listed subsidiary, Clearway Energy Inc. (CWEN), into which projects are dropped when they reach commercial operation. 

With this acquisition, TotalEnergies is establishing a major position in the U.S. renewable energy and storage market. Clearway has 7.7 gigawatts (GW) of wind and solar assets in operation through its listed subsidiary CWEN and has a 25 GW pipeline of renewable and storage projects, of which 15 GW are in an advanced stage of development. Headquartered in San Francisco, California, U.S.A., Clearway has approximately 760 employees.

Global Infrastructure Partners will receive USD1.6 billion in cash and an interest of 50% minus one share in the TotalEnergies subsidiary that holds its 50.6% ownership in SunPower Corporation, a leader in residential solar in the U.S. The transaction takes into account valuations of USD35.1 per share for CWEN and USD18 per share for SunPower.

As part of this partnership, TotalEnergies will contribute to enhance Clearway’s growth prospects by providing CWEN in the U.S. with access to its power trading capabilities and will give it priority on the farm down of its own developed projects.

The acquisition brings TotalEnergies’ renewable portfolio in the U.S. to more than 25 GW and contributes to the objective that the United States account for at least 25% of the company’s global target of 100 GW by 2030.

The transaction complements the portfolio that TotalEnergies has built up in the U.S. since the beginning of 2021.

In large-scale solar, TotalEnergies is already developing 8 GW of projects following the acquisition of a projects portfolio from SunChase, its partnership with Hanwha Energy and the recent acquisition of Core Solar. 

In offshore wind, TotalEnergies will develop 4 GW of projects off the coast of New York and North Carolina, after having been successful in tenders.

Finally, TotalEnergies welcomes GIP as an equity partner in SunPower. SunPower is the second largest residential solar company in the U.S., providing customers with fully integrated solar, storage, home energy and financing solutions. TotalEnergies and GIP are well-positioned to both support SunPower management’s growth strategy. 

“We are delighted with this partnership with Global Infrastructure Partners, which is a major player in renewables, particularly in the United States. It allows TotalEnergies to scale up in the U.S. market, one of the most dynamic in the world, benefiting from operating assets and a 25 GW high quality pipeline, in wind, solar and storage, with a wide geographic coverage with a presence in 34 states. This transaction perfectly fits with our strategy to make renewable electricity one of our main growth drivers along with liquefied natural gas that we have recently reinforced with the launch of Cameron extension. It illustrates our priority to accelerate the transformation of the company to become a sustainable and profitable multi-energy company,” said Patrick Pouyanné, chairman and CEO of TotalEnergies.

“We are extremely pleased to partner with TotalEnergies to continue leading the energy transition in the U.S.  We are proud of the growth and accomplishments of the Clearway team since our initial investment in 2018, and we are confident that with TotalEnergies as a partner, Clearway will be able to accelerate the deployment of cost competitive renewable power in the U.S.  At the same time, GIP’s investment in SunPower is our initial commitment in the distributed generation space, which we believe will provide critical solutions to facilitate the nation’s clean energy future. The scale, capabilities and ambition that both GIP and TotalEnergies bring to this partnership will support our shared vision to build industry-leading utility scale and distributed renewables platforms in the U.S.,” said Adebayo Ogunlesi, chairman and CEO of Global Infrastructure Partners, which is based in New York City, New York.

Both transactions are subject to customary conditions, including receipt of requisite regulatory approvals.