Global alternative asset and private equity investor KKR announced allocations of $800 million in renewable energy deals, including a commitment to purchase $550 million of solar energy loans from residential solar technology and energy services provider SunPower, and a $250 million investment in India-based industrial decarbonization platform Serentica.
The transactions mark the latest in a series of energy transition-focused moves for KKR, including an initial $400 million investment in Serentica last year, and the launch of investment platforms Virescent Infrastructure to acquire, own and operate renewable assets in India, Aster Renewable Energy, on renewable energy investment in Asia, and Stellar Renewable Power, aimed at originating long-duration high-yielding solar energy investments. KKR has deployed over $15 billion in equity globally to invest in renewable assets since 2011.
SunPower designs all-in-one residential solar and storage solutions, and in 2021, the company launched SunPower Financial, offering loans and financial products to residential solar customers, enabling a full set of solutions for home renewable energy purchasers, from design, sales, and installation, to warranty and financing. KKR’s $550 million loan purchase commitment will support the company’s ability to continue offering loan options to customers.
Guthrie Dundas, interim CFO of SunPower, said:
“With the closing of this transaction, we have raised sufficient capital year-to-date to fund a total of $1 billion of incremental solar loans for SunPower’s customers. As demand continues to rise, we expect this additional capital will power our loan bookings volume into 2024 and enable SunPower to increase access to the benefits of solar for more homeowners.”
Avi Korn, Managing Director at KKR, added:
“Residential solar is a key area of focus for our Asset-Based Finance business. We look forward to supporting one of the industry’s leading platforms to provide solar and energy services through this transaction.”
Launched last year, Serentica is focused on industrial decarbonization in India, by providing round-the-clock clean energy solutions to help transition large-scale, energy-intensive industries to clean energy. Activities include providing renewable energy solutions through long-term power purchase agreements (PPAs), and working with customers to design pathways to net-zero electricity.
Serentica recently signed a new set of Power Delivery Agreements in India, and is in the process of developing solar and wind power projects that will supply 9 billion units of green energy annually, helping to decarbonize a significant portion of the electricity consumption of large-scale industrial customers.
The Government of India approved a series of 2030 climate commitments last year, including a pledge to reduce emissions intensity by 45% and to transition to approximately 50% electric power from non-fossil-based sources. India’s parliament also recently passed a bill enabling a series of moves by the government to regulate and mandate the transition from fossil-based energy to clean and renewable sources in industry, transportation and buildings.
Pratik Agarwal, Director at Serentica Renewables, said:
“This investment will enable us to further accelerate large-scale decarbonization of the power-guzzling commercial and industrial segment. Our unwavering commitment to reversing climate change through the delivery of clean energy has been further reinforced by this investment, giving us greater confidence in our capabilities to achieve this vision.”
Hardik Shah, Partner at KKR, added:
“As India continues to develop at pace, clean energy solutions will play a growing and important role in meeting the country’s energy demands, especially in the industrial and hard-to-abate industries that Serentica looks to support. We are pleased to extend our relationship with Serentica to support their growth and propel their mission to enable India’s energy transition.”