Masdar Acquires Terra-Gen Stake - Expands U.S. Renewables
Masdar's joint ownership of Terra-Gen is evidence of its sustained commitment to funding and assisting the energy transition in the United States.
Abu Dhabi Future Energy Company PJSC – Masdar, a leading clean energy provider in the United Arab Emirates, has announced the successful completion of its acquisition of a 50% stake in Terra-Gen Power Holdings II, LLC. Terra-Gen, one of the largest independent renewable energy producers in the United States, was previously owned by Energy Capital Partners (ECP), which has fully exited its position in the company as part of the transaction.
Exit of ECP and Igneo's Continued Involvement
Energy Capital Partners, a major private investor in power and renewable assets in the U.S., has divested its entire stake in Terra-Gen following the deal's conclusion. Igneo Infrastructure Partners, a global infrastructure investment manager, continues to hold its existing 50% stake in the company, signaling confidence in Terra-Gen's future prospects.
Significance for Masdar's Expansion in the U.S.
The acquisition marks one of Masdar’s most substantial deals, further strengthening its foothold in the U.S. renewable energy market. Masdar, which first entered the U.S. in 2019, has an impressive track record of funding, developing, owning, and operating clean energy projects in the country. Prior to the Terra-Gen deal, Masdar’s U.S. portfolio boasted over 1.4 GW of generating capacity through utility-scale wind, solar, and storage assets. Terra-Gen’s scalable platform is seen as a key part of Masdar’s ambitious plans to expand its global renewable energy portfolio to 100 GW by 2030.
Terra-Gen's Renewable Energy Portfolio and Pipeline
Terra-Gen’s operational portfolio currently includes 3.8 GW of wind, solar, and battery storage projects, alongside 5.1 GWh of energy storage capacity. These assets are spread across 30 renewable energy sites, primarily located in California and Texas. Additionally, Terra-Gen is developing over 12 GW of new projects, including wind, solar, and battery storage facilities, with a significant focus on California, Texas, and New York. The pipeline includes a combined 386 MW of wind and solar projects in Texas and California, alongside 512 MWh of energy storage capacity in California, all expected to commence operations by 2025.
HE Dr. Sultan Al Jaber, UAE Minister of Industry and Advanced Technology, COP28 President and Chairman of Masdar, said: "The UAE and U.S. have long been partners in efforts to advance clean energy, a collaboration culminating in the Partnership for Accelerating Clean Energy (PACE) agreement. Masdar has a strong track record of supporting U.S. renewable energy projects, and the acquisition of Terra-Gen reaffirms this long-standing commitment. We are now on target to surpass our goal of having 10GW of integrated renewable generation capacity in the U.S. by 2030. This transaction unlocks further economic opportunities from green growth, and aligns with the global ambition to triple renewable energy capacity, in line with the historic UAE Consensus reached at COP28."
Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, said, “Terra-Gen’s experienced management team and scalable platform make it the ideal partner, as we work to increase our presence and investment in the U.S. as part of Masdar’s commitment to a long-term strategy in this important market. We look forward to partnering with Igneo to enhance Terra-Gen’s capabilities and position it as a leading developer, owner and operator of reliable and clean renewable energy in the U.S.”
Jim Pagano, CEO of Terra-Gen, said, “The finalization of this deal cements a strong relationship between Masdar and Terra-Gen. Masdar is a great partner for Terra-Gen because of our shared focus on developing clean energy projects and our commitment to decarbonization. We look forward to working with them to expand and build on our pipeline of U.S. projects.”
Niall Mills, Managing Partner and Global Head of Igneo, said, “Terra-Gen has been a strong platform for Igneo in the U.S. since our investment in 2020. We see tremendous potential to continue driving growth and creating long-term value in the U.S. renewable power sector through the capable and experienced team at Terra-Gen, and we look forward to partnering with Masdar on this exciting next phase of expansion.”
Masdar's Global and U.S. Renewable Energy Strategy
Founded in 2006, Masdar has maintained a long-standing commitment to expanding renewable energy projects globally. The acquisition of a 50% stake in Terra-Gen is a key milestone in advancing these goals. It also aligns with Masdar's efforts to support the UAE’s historic Consensus, aimed at tripling global renewable energy capacity by the end of the decade.
U.S.-UAE Collaboration in Clean Energy
Masdar’s ongoing investments in the U.S. underscore the strong relationship between the UAE and the United States. In January 2023, officials from both nations announced a partnership to accelerate clean energy development. Under this initiative, US$20 billion has been earmarked to finance 15 GW of clean energy projects in the U.S. by 2035, led by Masdar and a consortium of U.S. private investors through the Partnership for Accelerating Clean Energy (PACE).
Advisors on the Terra-Gen Acquisition
Several advisors played key roles in the Terra-Gen acquisition. Lazard and Guggenheim Securities served as financial advisors to Terra-Gen, with Latham & Watkins LLP acting as legal advisors. On Masdar’s side, BMO Capital Markets and JP Morgan provided financial advisory services, while White & Case LLP and Covington & Burling LLP offered legal counsel. Igneo Infrastructure Partners were represented by Mayer Brown as their legal advisor.
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