Summit Ridge Energy has raised $175 million in private equity from funds managed by Apollo Global Management (NYSE: APO) as it sets out to tap accelerating growth of so-called “community solar” projects, which expand distribution of solar energy to a broader swath of neighborhoods and adjacent cities.
The Arlington, Va. company, founded in 2017, has invested over $1 billion in joint ventures, creating over 300 megawatts capacity, some of which is operational and some are under construction. By 2023-end, SRE plans to deliver more than 500 MW of solar and 100 MWh of battery storage facilities to about 175,000 residential and commercial customers.
Unlike simple solar installations that locally use the energy produced, “community solar” projects distribute the generated electricity to a larger neighborhood, and nearby cities. Typically, this occurs via signups, with subscribers receiving electricity bill credits.
Tearaway growth
In recent years, community solar has registered tearaway growth — reaching over 1 million watts in 2020, from 142,447 in 2016. The Biden administration’s target of powering 5 million American homes with community solar projects by 2025 is expected to bring not only energy savings of $1 billion but also ensure blistering capacity growth of up to 700%.
“Summit Ridge is on a strong trajectory and we are excited to welcome Apollo as a new partner,” said Summit Ridge Energy CEO Steve Raeder. “Apollo’s long track record of sustainable investing, coupled with its operational expertise and significant resources, are an excellent match for Summit Ridge’s fast-paced growth and leading position in the clean energy economy.”
Corinne Still, a partner at Apollo Global, hailed the benefits of community solar, saying it offers “compelling benefits for individuals, households and businesses alike.” Still and fellow Apollo partner Wilson Handler will join the Summit Ridge board following the funding.
Largest rooftop community project
SRE, founded in 2017, is the largest community solar owner-operator in the country and also the co-owner — with climate investment firm Hannon Armstrong — of the country’s largest rooftop community solar project, called Bomber.The marquee project, in Hampstead, Md., is hosted on a facility owned by STAG Industrial. The installation is spread across 23 acres of unused roof space and generates 9.2 MW of direct current that is distributed to 1,300 Maryland households and businesses. The Bomber project creates carbon offset of 9.13 million pounds of coal burned.
So far, SRE has completed more than 70 projects across the Midwest, Mid Atlantic Northeast and New England markets by leveraging standardized design and equipment. In Maryland, what Raeder terms the firm’s “backyard,” it has created more than 75 MW of capacity, leveraging in particular commercial real estate for its installations. Nearly a third of its projects serve low-to-moderate income customers. SRE also has significant portfolios in Illinois and Maine, where it has acquired 13 projects from Revision Energy.
Virtually incubated from SunEdison
Steve Raeder, who previously led sales at SunEdison, has helmed SRE since its inception. SRE was established in 2017 by Raeder and several other executives of SunEdison, after the Missouri firm slid into bankruptcy. Raeder’s co founder, Brian Dunn, serves as the chief operating officer and chief financial officer, while several other principals at the firm previously worked at SunEdison.
Early funding for SRE came from New York-based Aligned Intermediary, an investment advisory firm focused on climate infrastructure assets, including renewable energy.
Apollo sets ambitious targets
Commercial Real Estate
MacKenzie Companies
Law
Nemphos Braue
Financial Services / Investment Firms
Chesapeake Corporate Advisors
Commercial Real Estate
Monday Properties
Venture Capital
Blue Delta Capital Partners
Internet / Technology
Foxtrot Media
Apollo partners Corinne Still and Wilson Handler have overseen the firm’s investment in SRE. Still focuses on infrastructure, and holds board seats on portfolio firms such as Broad Reach Power, Great Bay Renewables, Stagecoach Renewables and Freestone Midstream. Before joining Apollo in 2016, she was vice president at GE Energy Financial Services and a management consultant in the Energy & Natural Resources group at Accenture.
Handler oversees private equity investments at Apollo. Prior to joining in 2011, he was an investment professional at First Reserve and before that, a member of the Natural Resources group at Lehman Brothers. He serves on the boards of CSV Midstream Solutions, EP Energy, Jupiter Resources, Resource Energy and Wolfcamp Drill Co.
Apollo’s Sustainable Investing Platform, launched this year, has set the goal of deploying $50 billion in clean energy and climate capital over the next five years, and doubling it by 2030.
