Ares Management just made a big bet on the renewable energy industry. They have committed to purchase a 20% stake in Plenitude, Eni’s new subsidiary, for €2 billion, or roughly $2.3 billion. That agreement, signed in June of this year, represents a significant strategic bet to increase Ares’ footprint in the rapidly growing energy transition market.
At least that’s what our Plenitude portfolio of ten assets is leading us to believe. These ten assets have a collective capacity of 1,632 megawatts (MW). This is comprised of 1,030 MW from solar projects, 402 MW from wind initiatives, and 200 MW specifically for storage capacity. These projects smartly cover all four distinct power markets in the United States. This method allows for a diversification in how we generate energy.
Each of the projects in the portfolio are backed by long-term power purchase agreements (PPAs). Unlike annual appropriations, these agreements provide certainty and long-term predictability for future revenues. The average remaining contract length on these agreements is about 18 years at this point, emphasizing the security of the investment. The total estimated enterprise value of the whole portfolio combined is over $2.9 billion.
Strategic Growth in Renewable Energy
Steve Porto, a partner with Ares Infrastructure Opportunities strategy, said his firm was excited to partner with EDPR. He stated,
“We are excited to be partnering with EDPR on this highly contracted, attractive portfolio.”
This investment aligns with Ares Management’s commitment to supporting high-quality infrastructure assets while diversifying its portfolio across key domestic power markets. Porto emphasized the importance of this investment by saying,
“As we continue to provide capital to support the build-out of high-quality infrastructure assets, this investment presents a compelling opportunity to further diversify Ares’ presence across key domestic power markets and growing energy subsectors.”
Expansion of Ares’ Energy Portfolio
Ares Management successfully closed its recent acquisition of American Energy Partners, increasing its already-installed power generation capacity. Now, it adds up to over 5.7 gigawatts (GW) spanning 11 states and five independent power markets in the contiguous United States since September 2024. Ares has grown tremendously by tactically and strategically capturing renewable energy opportunities. This remarkable growth reflects their commitments to sustainable investing.
EDPR, the renewable energy developer involved in this transaction, is recognized for its extensive operations across Europe, the Americas, and the Asia-Pacific regions. The deal with Ares Management represents a strong vote of confidence with a long-term partner for straightening and accelerating the renewable energy growth curve.
Future Outlook
International and domestic demand for clean energy is at an all-time high. Ares Management’s significant investment in Enel’s Plenitude underscores this meaningful trend of investors embracing sustainable practices across their portfolios. The portfolio integrates solar, wind and storage capacities to power Ares’ growth strategy. This creative combination constitutes an important step in the movement towards green energy that is becoming a bigger reality across the world.