“GE and BlackRock, the giant investment firm with trillions in assets under management, have agreed to build a new solar industry powerhouse. Called Distributed Solar Development, the company will design, build, own and operate distributed solar and storage solutions for customers.
The new firm will stand on a bedrock of GE’s solar business launched by GE executive Erik Schiemann in 2012. He launched GE Solar as a nimble startup looking to design and build renewable onsite energy solutions for customers. Today, the business has more than 60 employees — with a collective experience exceeding 3 gigawatts — that have developed more than 125 solar-power sites for customers in industrial, commercial and government sectors. GE will retain 20% of the business; BlackRock takes an 80% stake.
The BlackRock deal is intended to put Distributed Solar Development, or DSD, in a good position to build on the demand for new distributed solar generating capacity. Indeed, DSD has ambitious growth targets. Currently, it builds about 100 megawatts of on-site solar projects each year; in five years, it hopes to quadruple that project pipeline. “
BlackRock Real Assets will supercharge this development expertise with capital. The firm, which manages $6 trillion in assets, operates one of the largest renewable power equity investment platforms in the world with $5 billion invested in over 250 solar and wind projects across the globe, with a total generation capacity of over 5.2 GW. “This investment will deepen our clients’ access to the tremendous growth potential in the U.S. solar industry,” says David Giordano, global head of renewable power at BlackRock. “DSD offers end-to-end in-house capabilities and a strong team of experts from across the commercial and industrial value chain. We look forward to working with the DSD team to capitalize on the development opportunities presented by the growing interest in renewable energy on behalf of our clients.”
Operating as a standalone company will also streamline DSD’s operations. “Separating ourselves from GE in this fashion means I can now do things more simply, with lower costs of capital, lower transaction costs, [greater] speed to execution and kind of that one-throat-to-choke from our customers’ perspective,” Schiemann says.”
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Guterl, Fred. GE Reports 17 July 2019.