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Capital Dynamics spins out solar and storage development group Arevon

By Charlie Duffield, Liam Stoker
Parent company Capital Dynamics bought Eland Solar + Storage in early 2020, a project currently under development pairing 400MWac of solar PV with 300MW / 1,200MWh in the Mojave Desert in California. Image: 8minute Solar Energy.

Major US renewables investor Capital Dynamics has spun off its US clean energy infrastructure arm and merged it with its former asset management affiliate to create Arevon Energy, a new multi-gigawatt solar and energy storage platform.

Arevon is backed by investors including the California State Teachers’ Retirement System (CalSTRS), an investor group comprised of APG and a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).

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The company has launched with a portfolio comprising 4.5GW of operating, under construction and late-stage development solar and battery storage projects, as well as a 3GW pipeline. Arevon recently brought online Saticoy, a 100MW / 400MWh battery energy storage system (BESS) project in Oxnard, California, which was built after local opposition to a new gas peaker plant. Projects the company now has in development include Capital Dynamics’ California Flats BESS, a 60MW / 240MWh battery energy storage system (BESS) which is being retrofitted to a 280MWac solar PV plant. The offtaker for that project’s output is technology giant Apple.

Arevon said it was to leverage “significant industry experience” from its staff and new leadership team – which includes ex-Capital Dynamics, sPower and AES executives – to deliver customised clean energy solutions to utilities and corporations in the US. Furthermore the company said it intended to expand upon its platform through customer acquisition activities, M&A and new developments.

Speaking to sister site PV Tech, Arevon Energy CEO John Breckenridge said it was this scale – the business has total assets valued at US$12 billion – that stands to give Arevon sufficient strength in order to succeed in what is rapidly becoming a richly competitive US solar market.

“That gives us the scale, in terms of procurement, in terms of how we operate, in terms of how we construct even in some of our development activities, relationships with off takers… all of those things that are beyond the cost of capital that are only really available if you have size, scale and vertical integration,” Breckenridge said.

That vertical integration has been a key motivation in assembling Arevon, Breckenridge added, noting that the business’s aim is to integrate the capabilities of Capital Dynamics into Arevon and “drive further in that direction”.

“I think that’s really the only way to succeed in this sector at the moment,” he said.

Component procurement is a particular subject of interest given supply chain constraints and pricing volatility that is impacting purchasing practices, driven by both raw material costs and policy. Arevon is backing its scale to be effective here as well.

“If you want access to batteries today, and you’re a small buyer, you’re going to be waiting a long time and paying high price. We’re buying billions of dollars worth of batteries, so that gives us a lot more opportunity to access that market. It’s the same thing with things like panels, and in all the other aspects of the business,” Breckenridge said.

Arevon’s perspective is that the solar industry must adapt to the emerging power needs of businesses if they are to capture that business.

For Breckenridge, this is where the combination of solar and storage comes into its own.

“We’re going to provide customers with power the way they use it, and that involves complex combinations of solar-storage, power trading, all the things that you can put together to offer a total renewable solution that meets the customer’s needs,” he said.

Arevon intends to be active in all of the US’ key markets such as California, but also in markets such as PJM where Breckenridge describes the market as smaller and more spread out. The south east of the country is also seeing considerable activity, with the company intent on establishing geographical diversity to mitigate any prospective risk in the market.

This piece has been adapted from two separate items which originally appeared on PV Tech. To read the interview with Arevon CEO John Breckenridge, go here.

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