New York’s largest utility, Consolidated Edison Inc., plans to sell its clean energy businesses to the U.S. arm of German conglomerate RWE AG for $6.8 billion.
ConEd, as it is better known, agreed to sell ConEd Clean Energy Business Inc. (CEB), and three related business units to RWE Renewables Americas LLC. The transaction is expected to close in the first half of 2023.
“The transaction…will allow Con Edison to sharply focus on our core utility businesses and the investments needed to lead New York’s ambitious clean energy transition,” said CEO Timothy P. Cawley.
“We will continue to advocate for state approval of utility-owned renewable generation for the benefit of our customers and all New Yorkers. We remain confident in New York, and in our ability to meet the needs of the clean energy future, while maintaining a safe, cost-effective system that delivers world class reliability for our customers,” he said.
Doubling U.S. Footprint
RWE said the acquisition could nearly double its current U.S. operating assets to 7.2 GW. ConEd CEB and the subsidiaries would add 3 GW of operating capacity and 7 GW-plus of developments in the works.
ConEd has more than 130 solar projects under its wings, making it one of the largest producers of solar energy in North America. Following the acquisition, RWE said it would become the second largest U.S. solar operator.
RWE’s current U.S. operations span Texas, with other projects across Arizona, Georgia, Illinois, Indiana, New York, North Carolina, Ohio, Oklahoma and Pennsylvania.
“The acquisition of Con Edison Clean Energy Businesses is a major boost for RWE’s green expansion in the United States, one of the most attractive and fastest growing markets for renewable energy,” said RWE AG CEO Markus Krebber.
“The unique combination of complementary portfolios in onshore wind, solar and batteries creates one of the leading renewable companies in the U.S. market. The combined development pipeline, one of the largest in the U.S., provides tremendous opportunities for sustainable and value accretive growth, backed by a strong financial position.”
RWE concurrently said the Qatar Investment Authority, the country’s sovereign wealth fund, also agreed to invest nearly $2.38 billion into the Essen, Germany-based energy provider to support RWE’s Growing Green strategy.
Earlier this year, the German energy giant also secured a lease in the New York Bight through a joint venture (JV) with National Grid Ventures to develop a 3 GW offshore wind energy area by 2030. RWE has also formed a JV with Diamond Offshore Wind to develop floating offshore wind off the coast of Maine.
In conjunction with the transaction, ConEd has waived its equity guidance for 2023 and 2024. Mizuho Securities USA LLC analysts estimated that the deal could provide ConEd with about $2.1 billion that could be used for share repurchases and special dividends.
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