Acciona to up solar investments, rules out yieldco

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Acciona, the Spanish clean energy company that has long been dominant in the wind power sector, has revealed this week that it is preparing to ramp-up its investments in solar PV over the next few years, with 2016 likely to see solar spending surpass wind for the first time ever.

The firm’s CEO, Rafael Mateo, confirmed to Bloomberg that wind and solar investments will each receive half of the planned €300 to €400 million ($332 to $439 million)annual capital spending over the next few years.

Mateo added, however, that "next year, we will probably have more PV than wind", having stressed that Acciona’s future growth will be in both PV and wind. The CEO’s comments came following the company’s decision to sell its wind turbine manufacturing business to Nordex SE for a reported sum of $880 million.

Solar PV had long been a minor part of Acciona’s wider strategy, with wind the key breadwinner. BNEF ranks Acciona as the fifth-largest western onshore wind company, and the 15th-largest in the world. In 2014, wind power accounted for 80% of Acciona’s output. Solar PV was below 2%, with solar thermal and hydroelectric power all generating more electricity than PV.

In pursuing more solar PV investment, Acciona had mulled the idea of forming a yieldco – such as those recently created in the industry by SunEdison (Terraform Power) and the SunPower-First Solar venture, 8point3 – but ultimately decided against going down that route.

Mateo explained: "We finally decided not to use this financial mechanism and now we are very happy with the decision. The commitment to shareholders to deliver growth is very difficult. Yieldco investors were buying growth. Growth is easy. Profitable growth is not."

Attracted by solar PV’s rapidly falling costs, Acciona is instead seeking ways to bolster relationships in the industry, notably eyeing KKR & Co., which already has a one-third stake in the firm’s foreign (non-Spanish) clean energy assets. Acciona will offer its 247 MW solar farm in Chile to KKR once it is completed and connected to the grid, the CEO confirmed.