Convergent has earned a reputation for its customer relationships and operating projects in energy storage space
Private equity firm Energy Capital Partners (ECP) has recently entered into the energy storage and development business following its announcement regarding the acquisition of Convergent Energy + Power. Apparently, Convergent will invest the obtained funds into self-financing customer projects which it will own over the long term.
Sale price for the deal remained undisclosed, however the companies mentioned that ongoing funding for projects and acquisition payments will add up to about several hundred million dollars.
Convergent CEO Johannes Rittershausen stated that moving forward with Energy Capital Partners will make their model much more efficient and enable the company to offer better value propositions. He added that Convergent will explore more ambitious and numerous storage projects using the newly obtained funds.
Andrew Gilbert, Energy Capital Partners Principal, was quoted saying that from the buyer’s perspective, Convergent has earned a reputation for its customer relationships and operating projects.
Gilbert noted that Convergent provides customers real savings almost immediately in material ways and the returns they offer are better than other alternatives seen in storage or renewables.
Both companies have seemingly expressed caution about competing in the major utility-scale acquisitions, where leading players like First Solar and NextEra compete on mega projects with tighter margins. This market is more commoditized as compared to where Convergent operates, which is larger than the typical commercial project but is still driven by needs of private customers.
For the record, a New York-headquartered company, Convergent owns, develops and operates large-scale storage for industrial utilities and customers. The firm has described itself as a rare startup that opted to self-fund its projects, piling $70 million in doing so. Evidently, Convergent has also responsible for the largest industrial and commercial storage project in Ontario, Canada.
For the uninitiated, Energy Capital Partners invests and owns in an extensive portfolio of energy companies, including Sunnova and Calpine.