Clean Energy | September 11, 2019

Goldman Sachs raises nearly $2 billion for solar yieldco

Amy Cortese
ImpactAlpha Editor

Amy Cortese

Goldman Sachs’s asset management arm closed on $1.9 billion in equity commitments for its Goldman Sachs Renewable Power LLC, a private renewable energy investment company that buys or leases power and sells it under long term contracts—also known as a yieldco for its lucrative recurring dividends. Additional debt funding will bring its total arsenal to $4 billion.

Since it was formed in 2016, the unit has invested over $1.4 billion to assemble 1 gigawatt of distributed solar assets. That’s helped it become one of the largest owners of distributed generation solar assets in the U.S.—and add a stable, revenue stream to Goldman’s business. In March, it leased $86.9 million in commercial solar project leases from SunPower. Last year, it acquired SunTap, with nearly 200MW worth of projects in California and Arizona, from KKR & Co, among other investments.

Yieldcos fell out of favor after the implosion of SunEdison in 2016. Yet they have been staging a comeback, buoyed by demand for solar as well as yeildco structures with more rigorous governance.