Despite federal resistance towards wind and solar development, the renewable energy sector in the United States is set for impressive growth, an increase which could accelerate depending upon the outcome of the upcoming November presidential election. Already, the nascent renewables industry is on the cusp of massive expansion, as evidenced by the maturing corporate landscape; the ten largest renewable companies in the US own over 40% of all operational utility wind and solar capacity in the country. NextEra Energy leads the way for both wind and solar, emerging as the top player in the country – by some distance. Other asset owners in the top ten are mostly headquartered in the US, with a handful of global European players in the mix.
Wind: a mix of American and European players
NextEra dominates onshore wind in the US with over 15 gigawatts (GW), more than double the operational capacity of runner-up Avangrid, majority-owned by Spain’s Iberdrola. MidAmerican Energy, a power utility subsidiary of Berkshire Hathaway, is placed third. Other European-based players take the fourth to seventh places, led by Portuguese EDP in fourth. However, EDP is looking to shed its 80% stake in five assets worth 560 megawatts (MW) to investor Connor, Clark & Lunn Infrastructure for about $676 million. The deal is yet to close.
The middle pack is represented by Italian energy utility Enel, Germany’s RWE and French firm EDF. RWE made it into the top ten after having completed the acquisition of E.ON’s entire renewable portfolio this year. Meanwhile, EDF could see its seventh-place position overtaken soon, after announcing a deal last month to sell around 800 MW of wind and solar assets in the US to Abu Dhabi’s Masdar. The divestment is yet to be completed. Rounding off the top ten are three firms headquartered in North America, but backed by institutional investors. Chicago-based Invenergy is majority-owned by Montreal’s institutional fund CDPQ, amongst other investors. Clearway Energy is part of the Global Infrastructure Partners portfolio and Pattern Energy was acquired by the Canada Pension Plan Investment Board in March this year.
When analysing the location of renewable assets in the country, the Central US – Texas, Oklahoma, Kansas, Iowa, and Illinois – has the most favourable wind conditions and the highest concentration of onshore wind plants. Every firm in the top ten has a portfolio of wind assets scattered across a collection of central states, apart from MidAmerican Energy, whose assets are entirely based in Iowa where the company is headquartered. On the other hand, frontrunner NextEra owns assets across 19 states while Avangrid has wind farms in 21 states. Texas emerges as a key state for nine of the ten companies; NextEra, Avangrid, RWE, EDF, Invenergy, Clearway and Pattern all have the majority of assets in the lone star state. Enel, in contrast, has most of its current fleet in Oklahoma and Kansas, while EDP is a prominent player in Illinois, Indiana and New York.
Solar PV: NextEra and utilities lead the way
Like wind, NextEra has double the operating capacity as number two place holder ConEdison, with over 5 GW. Unlike wind, European-based players are nearly missing in the top ten list for solar. Only Clearway Energy breaks into the top ten list – claiming tenth place. However, utility companies take second, third, fourth and seventh places. ConEdison, Dominion Energy, Southern Company and Duke Energy have all ventured into asset ownership as they have invested large amounts of capital in solar PV in recent years. Capital Dynamics, a global asset manager, is in fifth place, followed by BHE Renewables, another unit of Berkshire Hathaway. US-based developers Cypress Creek Renewables and sPower make up the rest of the top ten.
Unsurprisingly, the top ten’s assets are mostly situated in the Sun Belt states, with the majority of solar plants located in California. NextEra’s solar assets are located across 15 states, and the company is noticeably dominant in Florida through its subsidiary Florida Power & Light. Dominion Energy is prominent on the East Coast and Utah, while Cypress Creek is heavily invested in the Carolinas.
New entrants and NextEra going strength to strength
Looking at announced future projects in the next five years, we see some new names with Apex Clean Energy developing over 7.5 GW of future wind capacity. Apex, however, is not expected to stay on the list for long – the firm is a project developer and typically sells its projects at a late-stage in development or when assets become operational. With around 4.5 GW, the majority of second-place holder Pattern Energy’s pipeline comes mostly from the 4 GW Corona Wind Project in New Mexico. NextEra defends their lead in terms of installed capacity, with a solid pipeline of announced future projects, placing them in third place with just over 4 GW.
NextEra has no plans to forfeit its leading position in solar either, with over 4.5 GW in the pipeline. Three developers are more or less tied for the following three places; Invenergy, EDF and Apex Clean Energy. We also see that many of the companies on solar list – Apex, First Solar, Hecate Energy and 8minute Energy – are specialized developers who we expect will sell their projects at some point. Invenergy and EDF also tend to divest projects. The large number of developers on the list shows that the US solar market is, to a large extent, a build-transfer market compared to wind; one company develops a project, while another owns and operates it.