SunEdison Inc continues the bankruptcy aftermath. The solar firm is reportedly selling off one of its major wind projects to Sitec RE. If the deal is agreed upon, it would be SunEdison’s first Indian asset sale since its bankruptcy.
SunEdison Inc Starts Asset Sale in India
Last week, analysts thought that SunEdison would initiate its asset sale in Hawaii. Instead, it could transpire in South Asia.
Reports now suggest that the solar firm is close to an agreement with Sitec RE. The deal would see SunEdison sell a 24 MW wind-power plant in Andhra Pradesh to the domestic firm.
Sources close to the situation say the transaction could be completed within the next 10 days. The details of the agreement have not been released. Many are speculating that there is another 50 MW of room available, which means Sitec RE is likely to expand the wind project.
Sitec RE, which is part of the engineering services firm Sitec Group, has 830 MW of wind projects currently in operation or in development. With SunEdison looking to sell off assets in its immense portfolio, this would be an opportune time for the wind energy firm to make purchases.
A majority of SunEdison’s India portfolio is solar. It has 410 MW of solar power, and an extra 1,000 MW of solar under construction. SunEdison only has 101.6 MW of wind assets in Rajasthan and Karnataka. These were bought last year from Spanish green energy group Fersa Energia Renovables for $39.2 million
The bankrupt firm is looking to sell both its wind and solar projects. For the last couple of weeks, it has held talks with ReNew Power, Adani Green Energy and other Indian firms.
SunEdison Asia-Pacific President Pashupathy Gopalan has not commented on the reports.
Could SunEdison Inc’s Collapse Seep into the Entire Industry?
With SunEdison’s well-known collapse, some analysts are wondering if other solar players could face the same debacle? As several solar firms are struggling, particularly SolarCity Corp (NASDAQ:SCTY), financial experts are debating if SunEdison’s bankruptcy could lead to potential fallout for the rest of the solar industry.
Here is a brief rundown of what other solar firms are currently experiencing:
- SolarCity posted its 13th straight quarterly loss (stock is down 57 percent YTD).
- Vivint Solar Inc (NYSE:VSLR) reported a $69 million loss for the first quarter (stock is down 65 percent YTD).
- SunPower Corporation (NASDAQ:SPWR) announced higher-than-expected Q1 losses (stock is down 41 percent YTD).
- Yingli Green Energy Holding Co Ltd (NYSE:YGE) is on the verge of becoming a penny stock.
There isn’t a consensus as to why many solar firms are struggling. Some allude to falling oil prices, while others say state policies aren’t helping. But forecasts suggest solar should be having one of its best years in 2016. It was projected that solar installations would jump 17 percent, while PV capacity could reach up to 69 GW.
SunEdison’s bankruptcy may have incited a panic among investors. If its two yieldcos – TerraForm Power Inc (NASDAQ:TERP) and TerraForm Global Inc (NASDAQ:GLBL) – also crumble then it could create even more havoc across the industry. It should be noted that many do expect the yieldcos to follow their parent company.
Won’t somebody please think of the investors?