Duke Energy to divest commercial renewables business to Brookfield Renewable in $2.8bn deal

American electric utility Duke Energy has signed a deal worth approximately $2.8 billion to offload its unregulated Commercial Renewables business to Brookfield Renewable.

The consideration includes non-controlling tax equity interests and the assumption of debt.

The sale, which will net Duke Energy around $1.1 billion after adjustments, forms part of a strategic initiative to bolster its balance sheet and avert extra holding company debt issuances. This move is anticipated to aid Duke Energy in focusing on its regulated business expansion, with plans to incorporate over 30GW of regulated renewable energy into its network by 2035.

As part of the agreement, Brookfield Renewable will acquire more than 3.4GW megawatts of utility-scale solar, wind, and battery storage across the US, net of joint venture partners ownership. This acquisition includes operations, new project development, and current projects under construction.

Lynn Good — Duke Energy chair, president, and CEO said: “As one of the country’s largest renewable energy operators, Brookfield has the resources to support the continued growth and success of the Commercial Renewables’ portfolio.

“This sale is an important step in our transition into a purely regulated company with significant grid and clean energy investment plans that will deliver benefits to our customers and stakeholders.”

Duke Energy to sell its commercial renewables business to Brookfield Renewable in $2.8bn deal. Photo courtesy of Duke Energy Corporation.

The main operations of the Commercial Renewables business will continue to be stationed in Charlotte, N.C., ensuring minimal disruption to the business. Furthermore, the Duke Energy employees integral to the business will move to Brookfield, maintaining business continuity and consistent service to customers.

Connor Teskey — Brookfield Renewable CEO said: “With this acquisition, we are adding a scale operating renewable platform with a full suite of in-house capabilities and a proven management team experienced in operations and development.

“We are also adding to our pipeline of renewable development projects, solidifying our position as one of the largest renewable energy businesses in the U.S. with almost 90,000 megawatts of operating and development assets.”

The transaction is contingent on meeting customary closing conditions, including regulatory approval from the Federal Energy Regulatory Commission and the expiration of the Hart-Scott-Rodino Act’s waiting period. The sale is projected to close by the end of 2023.