TerraForm Power is to acquire distributed generation solar projects in the US totalling 320MW from subsidiaries of AltaGas for $720m.
The assets include 291MW of commercial and industrial solar, 21MW of residential photovoltaic and 10MW of fuel cells across 20 states and the District of Columbia.
TerraForm said the projects have been operating on average for 3.5 years, with the average term on remaining power purchase agreements 17 years.
Initial funding for the acquisition comes from a $475m bridge facility, with permanent funding comprised of $475m debt and $245m raised from the sale of minority interests in unnamed North American wind assets.
TerraForm Power chief executive John Stinebaugh said: “Following the close of this transaction, TerraForm Power is expected to own one of the largest portfolios of distributed generation in the US.
“The acquisition will increase TerraForm Power’s average contract duration to 14 years and enhance its resource diversity.
“Furthermore, this demonstrates our strategy of recycling capital from stabilised assets with limited opportunities for further value creation into newly acquired assets that meet our return targets and have commercial and operational upside that we can extract through our integrated operating platform.”