French multinational utility company ENGIE has agreed to acquire the battery storage business of Houston-based Broad Reach Power for $1 billion. The deal was made with EnCap Energy Transition and its co-investment partners Yorktown Partners, Mercuria Energy and Apollo Infrastructure Funds.
“Our firm’s success is a direct result of the tireless dedication of our team, who go above and beyond every day” said Stacey Peterson, Broad Reach Power’s CEO, who joined the firm last year. “This a great transaction and we are excited for its continued growth,” she added.
Since Broad Reach was founded in 2019 with backing from EnCap Energy Transition, it has become a leading U.S. developer and operator of renewable energy and energy storage power projects in Texas, California and other markets.
“EnCap Energy Transition is pleased to have founded, with the talented, hard-working management team at Broad Reach Power, the top battery storage player in the U.S. market,” said EnCap Energy Transition managing partner Shawn Cumberland, who is also chairman of the Broad Reach board of directors. “It has been a pleasure to have partnered with Apollo Funds in this important and valuable venture.”
Apollo Funds acquired a 50% stake in the company and joined the board in December 2021.
“At Apollo, we’re committed to being leading investors in the energy transition, and we’re proud to have been a significant, value-add owner of Broad Reach Power during years of incredible growth for the business,” Apollo Infrastructure Partner Corinne Still said. “Together with EnCap and the Broad Reach Power management team, we’ve built what we believe is the leading and most innovative battery storage IPP in North America.”
The sale to ENGIE includes 350 MW of grid-scale battery assets in operation and 880 MW under construction mainly in the Electric Reliability Council of Texas (ERCOT) territory, with commissioning expected before the end of 2024. The acquisition also includes a 1.7 GW pipeline of battery storage projects at an advanced stage of development and a significant pipeline of early-stage projects. The first CAISO storage asset is expected to be operational in 2023.
“It has been a terrific honor and pleasure to be part of the rapid growth of the U.S. energy storage sector from the very beginning and see our company grow into one of the top developers,” said Doug Moorehead, Broad Reach founder and chief operating officer.
The transaction does not include the company’s portfolio of 1.8GW of solar and wind power projects together with 4GWh of battery storage in the Mountain West region of the U.S.
EnCap Energy Transition has been an aggressive provider of capital in the fast-growing U.S. energy storage business since 2019. With this announcement and including the sale of Jupiter Power to Blackrock in December 2022, the company has now been responsible for shepherding the creation, development, growth and monetization of two of the largest standalone energy storage companies in the United States.
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