Apollo’s move is a sign of confidence in Clearway, which cut its dividend from 33 cents to 20 cents per share last month amid concerns that California utility PG&E Corp could abandon its power purchase agreement with Clearway, a wind, solar and natural gas-fired power generation company.
Credit ratings agencies have downgraded several renewable energy projects with significant revenue exposure to PG&E in the aftermath of its bankruptcy filing, including Topaz Solar Farms, owned by Warren Buffett’s Berkshire Hathaway Inc, and Genesis Solar Farm, developed by NextEra Energy.
The PG&E contract accounts for about 23 percent of Clearway’s cash flow. Clearway Chief Financial Officer Chad Plotkin told investors on the company’s fourth-quarter earnings call on Thursday that PG&E had continued to make payments, but that the cash did not flow to Clearway because of debt covenants in its renewable energy projects.
PG&E has not yet decided whether it will default on its power purchase agreements as part of its bankruptcy process. If it does, these contracts would have the same claim as $20 billion of unsecured bonds that PG&E has outstanding.
Disclosure: I have NEE, NEP, PEGI and CWEN holdings.
Submitted March 02, 2019 at 07:39AM by COMPUTER1313 https://ift.tt/2SFMktz
