American Electric Power purchases Sempra Renewables, bolstering wind and battery assets
With $1.05 billion, American Electric Power (AEP) Clean Energy Resources has purchased Sempra Renewables LLC, adding its 724 megawatts of wind generation and battery assets to its renewable investment efforts.
The purchase adds to AEP’s portfolio seven wind farms and a single battery installation scattered across seven states, though five of the wind farms were only partially owned by Sempra, and the respective shares in these operations remain unaffected. In so doing, AEP has taken a major step forward on a previously announced plan to invest $2.2 billion in capital investment into competitive, contracted renewables by 2023 and diversified their methods of energy generation. Their renewable portfolio has now reached 1,075 MW in 11 states.
“The long-term contracts and attractive returns associated with these existing assets will be immediately accretive to earnings and solidify our projected 5 to 7 percent earnings growth rate,” Nicholas K. Akins, AEP chairman, president and CEO, said.
The purchase was made with $584 million in cash, including $33 million in working capital and the assumption of $470 million in existing project debt and tax equity obligations. With the purchase, AEP has also added 20 employees from Sempra. Its new facilities are located in Colorado, Hawaii, Indiana, Kansas, Michigan, Minnesota and Pennsylvania.
In addition to its 2023 pledge, the addition of these wind farms also moves AEP closer to a pledge to cut its CO2 emissions by 80 percent of its 2000 levels by 2050.
