International Automated Systems (fka IAUS)

[scion]

KKR and Google to Invest in Six U.S. Solar Power Plants

By Ryan Dezember
Nov. 14, 2013 12:03 a.m. ET
http://online.wsj.com/news/articles/SB10001424052702303559504579196172665159140?mod=WSJ_business_whatsNews

KKR & Co. and Google Inc. have struck a pact to invest about $400 million in six solar-power plants being built by Recurrent Energy LLC in California and Arizona, according to people familiar with the matter.

The deal, which could be announced as soon as Thursday, marks the second time the trio has tied up together. In late 2011, Google and KKR agreed to invest in four solar farms south of Sacramento that Recurrent, a unit of Sharp Corp. , developed and continues to manage. That deal was valued at $350 million, including debt, one of the people said.

Development of the plants has been under way for years and they are expected to go online and begin producing power in January, the people said.

The plants—five in southern California and one in Arizona—are designed to produce about 106 megawatts of electricity combined, or enough to power about 17,000 U.S. homes, they said. San Francisco-based Recurrent, which will continue as their operator, has struck long-term power supply agreements with three buyers for the electricity they're expected to churn, the people said.

Google and KKR's joint investment of $400 million represents a combination of cash and debt, one of the people said. Google's equity stake is about $80 million, another person said.

The investment comes as the U.S. solar market continues to grow thanks in part to government policies supporting renewable energy production.

Arizona and California are among states that have mandated that utilities boost their use of renewable resources, making them attractive places to build solar facilities, beyond their ample sunshine.

The Sacramento-area facilities that Google and KKR previously invested in began delivering power to the Sacramento Municipal Utility District, one of the nation's largest public utilities, in May 2012, Recurrent said at the time.

Both Google and KKR have become big investors in renewable power. Google, for example, touts over $1 billion pumped into renewable projects, ranging from wind farms in the Mojave Desert, North Dakota and Arlington, Ore., to a German solar facility and a transmission line for wind farms off the mid-Atlantic Coast. The Internet giant has also signed contracts to buy 570 megawatts of renewable electricity for its data centers.

KKR is funding its portion of the investment in the solar plants from its infrastructure fund. That same pool of cash has been tapped to make investments in a French wind farm and solar power facilities in Canada, Spain and the U.S.

http://online.wsj.com/news/articles/SB10001424052702303559504579196172665159140?mod=WSJ_business_whatsNews