December 20, 2021
An Exit To Accelerate Climate Impact: AES Acquires Community Energy Solar
December 20, 2021 / Dave Kirkpatrick LinkedIn / – We are delighted to announce the acquisition of Community Energy Solar (CES) by AES to accelerate the deployment of utility scale solar and storage. SJF led the Series A financing for CES in 2010, in partnership with our co-investor NGP ETP. At that time, the CES team had spun out of Iberdrola, who had acquired CES a few years prior as one of the earliest wind power developers. Our thesis was that a proven renewables development team, led by co-founders Brent Alderfer, Eric Blank and Brent Beerley, could translate their expertise from developing wind to scaling solar in multiple new state markets.
Wow, did the CES team prove us right! They went on to deliver three gigawatts (GW) of utility-scale and community solar projects in 15 states, while building a pipeline for 10 GW of projects across 29 states. CES was uniquely prescient in making development bets early in anticipation of declining solar costs, state renewables policies and corporate clean power demand. CES cracked the market in seven states where there had been no prior utility scale solar projects. First-of-its-kind projects in these states include the180 megawatt (MW) Amazon Solar Farms in Virginia, 120 MW Comanche Solar in Colorado, 100 MW North Star Solar in Minnesota, and 103 MW Butler Solar in Georgia. The CES team blazed the trail through the financing, interconnect, land acquisition, permitting, and offtake complexities to show how to ‘go big’ in solar. They consistently delivered clean power at lower prices than coal or gas plants.
Our partnership with CES also informed SJF’s further investments in the clean energy transition, including Nextracker and Terabase in driving down costs in utility solar, PosiGen in residential solar and efficiency, and Voltaiq in energy storage. Indeed, our latest theme of interest, green hydrogen development, is also influenced by the CES playbook, defined by visionary, early leadership in displacing high carbon energy sources.
The CES team stayed disciplined in pursuing its mission in a capital efficient manner. The company operated profitably since the Series A round. CES built and owned smaller projects on its balance sheet while transacting with leading utilities, corporate buyers, and PE funds for projects requiring hundreds of millions of project finance and tax equity. The CES management team developed a team culture in which all employees, alongside all investors, received annual profit sharing in years with successful project monetizations.
The company also successfully navigated leadership transitions. Eric Blank and Brent Alderfer moved out of day-to-day management and into next-stage climate impact opportunities. Blank now serves as the Chair of the Colorado Public Utilities Commission and Alderfer focuses on national policy, including work with Princeton University on decarbonization economics and piloting a climate-tech vehicle-to-grid start-up. Brent Beerley stepped up as CEO in recent years and led the team through a process to deepen initiative and leadership throughout the organization. Beerley helped foster a great team, including Joel Thomas (a former SJF intern!), Molly Arbes, Emily Burks, Jay Carlis, Dave Krupp, and many more. These individuals will all be playing key roles within AES to further accelerate decarbonization of the electric grid.
While it is bittersweet to leave the board of CES, I am proud of how SJF helped to catalyze the immense climate and community impacts the company achieved over the last decade. I am grateful to Cody Nystrom at SJF for helping me lead the investment in the early years, to Chris, Phil and James at NGP ETP as great co-investor partners, and to Brent, Brent, Eric and the whole CES team for the partnership. Just as we are still proud of Nextracker’s scaling impact within Flex (now up to 50 GW of projects globally), so too will we continue to cheer for the Community Energy team as they move forward with their mission to develop much more solar to fight climate change within AES.