Dive Brief:
- Southern Company subsidiary Southern Power is selling about one third of its 1.7 GW portfolio of solar facilities to Global Atlantic Financial Group for $1.175 billion.
- Southern Power will continue operating the 26 solar projects whose energy is sold under long-term contracts, acting as a general partner in the partnership.
- Southern executives identified a $7 billion equity need over the next five years on the company's first quarter earnings call this year. Last year, executives outlined several initiatives to raise cash on hand to deal with increased debt levels, added costs to complete the Vogtle nuclear project and financial troubles at its Mississippi Power subsidiary, according to Bloomberg.
Dive Insight:
Southern Power, Southern Co.'s wholesale energy provider, also has a wind portfolio. Southern executives announced in their last earnings call that they are exploring third-party tax equity financing for much of the existing wind portfolio. That financing vehicle could offset $1 billion of the parent company's total equity need and funds could be received in the second half of this year, according to Southern CFO Arthur Beattie.
In addition to selling its solar portfolio and other potential assets owned by Southern Power, Southern recently agreed to sell Gulf Power, Florida City Gas and its interests in Florida natural gas plants Oleander and Stanton to NextEra Energy for $6.475 billion. State and federal regulators must approve the deal, which will contribute to Southern's equity need while focusing the company's electric utility offerings across its three state-based subsidiaries in Mississippi, Alabama and Georgia.
Southern subsidiary Georgia Power continues the development of two nuclear reactors at Vogtle with Bechtel handling construction. Vogtle Unit 3 is expected in service by November 2021 and Unit 4 by November 2022.
