Thin-film PV maker First Solar has acquired NextLight Renewable Power, a developer of utility-scale power project for $285 million. This latest acquisition significantly bolsters First Solar’s project pipeline, adding some 1,100 megawatts of solar projects that are at various stages of development.
NextLight is backed by Energy Capital Partners, a clean energy-focused private equity fund based in Short Hills, N.J., founded by former Goldman Sachs energy banker Doug Kimmelman.
The Acquisition grows First Solar U.S. exposure at a time when European markets, in particular Germany and Spain, which account for a majority of First Solar’s revenues, are tightening key subsidies. Germany is set to cut its solar power feed-in tariffs by some 10 percent and the Spanish government is considering scaling back its own subsidy program by as much as 40 percent.
NextLight, based in San Francisco, has about 570 megawatts of solar power under development that are backed by singed, long-term power purchase agreements (PPA). Including Agua Caliente, a 290 megawatts facility located in Arizona’s Yuma County, which signed a PPA with Pacific Gas and Electric (PG&E) last fall. More recently NextLight’s Silver State solar project, located on Bureau of Land Management land in Nevada, signed a 25-year PPA with NV Energy. The Silver State project is slated to begin operating in May of 2011.
NextLight also has 530 megawatts of additional PV power projects in various stages of development, according to the press release announcing the deal.
In January First Solar acquired a project pipeline comprised of utility-scale solar power projects to be developed in California and across the U.S. Southwest from the Edison Mission Group (EMG), a unit of Edison International. And a little more than a year ago it bought project developer OptiSolar in an all stock transaction worth $400 million.
The acquisition will allow First Solar to monetize its PV panel production by securing sales contracts with NextLight Projects. First Solar, which has repeatedly shown that it does not want to be a plant operator, will likely flip the Nextlight plants when they near completion.
Over the past year First Solar sold a 21-megawatt solar project — backed by a long-term PPA with Southern California Edison in Blythe, Calif., to NRG Energy. It also sold a 20-megawatt solar farm in Ontario to natural gas pipeline operator Enbridge for about C$100 million ($93.14 million). The project is backed by a 20-year PPA with the Ontario Power Authority.
For this year Tempe, Ariz. First Solar says it expects to generate revenues ranging between $2.7 billion – $2.9 billion in 2010, which is ahead of analysts’ estimate of $2.4 billion.