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Duke Energy Corp. (NYSE: DUK) has reached a deal to sell a piece of its commercial renewables business after putting it up for sale last year.
Duke announced today it would sell its utility-scale commercial renewables business to Brookfield Renewable Partners (NYSE: BEP) for $2.8 billion. The deal is expected to close by the end of the year. Duke said it expected net proceeds from the deal to be approximately $1.1 billion.
The sale "will allow the company to focus on the growth of its regulated businesses, including investments to enhance grid reliability and help incorporate over 30,000 megawatts of regulated renewable energy into its system by 2035," Duke said in a statement.
A transaction summary available in a U.S. Securities and Exchange Commission filing by Duke states the agreement was reached on June 9. The sale includes "materially all of the company’s utility-scale solar and wind group," the filing states. Net proceeds will be received in two installments over 18 months.
“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,” Duke CEO Lynn Good said in a news release. “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.”
Brian Savoy, Duke's executive vice president and chief financial officer, told the Charlotte Business Journal in February that the commercial renewables business would likely sell later in 2023. Duke is also moving to sell its distributed energy business, which is the remaining portion of its commercial renewables business segment.
Duke said in its announcement today that it "continues to make strong progress on a separate sale underway for its distributed energy business, which is also expected to close by year-end 2023." The transaction summary sheet in Duke's SEC filing states that "the carrying value of these assets was approximately $450 million as of March 31."
The sale of the utility-scale business to Brookfield is subject to several closing conditions, including regulatory approval under the Federal Energy Regulatory Commission.
“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,” Brookfield Renewable CEO Connor Teskey said in a release. “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.”
Duke Energy serves customers across the St. Petersburg, Clearwater and Orlando areas.