Brazilian real estate fund completes purchase of solar plant

Brazilian real estate fund CPV Energia FII (RENV11) has completed the purchase of special purpose company Yellot SPE II for 5.8 million reais (US$1.05mn).

The special purpose company owns a solar power plant in Alexânia, Goiás state. The distributed generation (DG) plant has installed capacity of 1MW in alternating current and 1.3MW in direct current.  

The shares of the RENV11 fund began trading on São Paulo stock exchange B3 at the beginning of August. The fund is co-managed by Armor Capital and CPV Asset, with risk and invested asset analysis carried out jointly by CPV Asset and Armor Energia.

A power trading company dedicated to retail, Armor responded, via its press office, to questions sent by BNamericas.

BNamericas: How important is the acquisition of the special purpose company? 

Armor: The acquisition represents a strategic step in diversifying and strengthening the fund's portfolio. The investment also demonstrates the fund's ability to respond to emerging demands in the electricity sector, especially in times of water scarcity, where solar energy becomes crucial.

BNamericas: Is the fund considering acquiring other energy assets? Is the focus always on solar? 

Armor: The fund expects to reach 500mn reais under management and 50MW of capacity by 2025. 

RENV11 is the second fund to invest in the renewable energy segment and has the distinction of focusing on plants already in operation. 

Although the initial investment was in solar power plants, the possibility of exploring other renewable energy sources over the next 36 months is being considered, in line with market demands and emerging opportunities in the energy transition. 

The aim is to acquire projects that are already connected to the grid to avoid connection risks and focus on assets that can generate solid financial returns. 

BNamericas: What are the prospects for the DG market in Brazil?

Armor: They are positive, especially in a scenario where solar energy is increasingly valued due to its ability to meet demand, especially during periods of drought. 

The increase in investment in renewable energy, as evidenced by the acquisition of RENV11, reflects a growing trend in the sector, which seeks not only to mitigate climate change but also to offer solid business opportunities.