Aligned Climate Capital announced the final close of its sixth distributed solar fund, Aligned Solar Partners 6 LP (ASP6), with commitments above the $200 million target fund size. AndASP6 achieved final close with participation from leading institutional investors in the U.S. and globally, including insurance companies, endowments, foundations, and family offices.
Aligned has been investing in the distributed solar market over the last few years, and this Fund represents its largest investment partnership to date. And Aligned has achieved strong financial returns in this strategy to date, with significant realized returns to investors and consistent annual cash distributions.
ASP6 buys construction-ready distributed solar projects from development partners across the U.S., finances their build-out, and delivers returns through tax credit monetization, operating income distributions, and portfolio sales to institutional infrastructure investors.
Aligned Solar Partners (ASP) is the firm’s primary infrastructure strategy, and it has invested capital in the “middle market” of solar energy since 2018. And to date, the firm owns and operates more than 65 MWdc of projects across seven states. Plus, it has consistently targeted underserved and rural markets, which it believes have unique advantages.
The firm finances construction with equity and construction debt, then monetizes the tax credits and secures long-term, low-cost permanent debt. And Aligned has placed construction debt with Seminole Financial Services for this portfolio and prior ASP funds.
Aligned buys solar projects ranging from 1 MWac to 10 MWac from development partners across the U.S. And many of these developers have collaborated with Aligned on multiple successful projects over the years.
The firm prioritizes development partners with a track record of delivering financially viable, construction-ready assets. Rewild Renewables, its partner, developed two of the Fund’s current projects in Delaware.
ASP6 has already placed over 25MW of distributed solar projects in Maine and Washington, D.C. The Fund also acquired additional solar projects in other states, which are under construction or scheduled to begin over the next two years, with the majority of the Fund’s capital committed to these assets. ASP6 is expected to make its initial cash distribution to investors in 2025, and it plans to make annual cash distributions going forward, before ultimately selling the operating portfolio to institutional investors following the tax recapture period.
KEY QUOTES:
“The U.S. needs new power generation to meet growing electricity demand, and solar energy is the cheapest, fastest, and cleanest technology in the market. We have been investors in this market for more than a decade and understand how solar can deliver consistent cash returns for our investors each year.”
Peter W. Davidson, CEO of Aligned Climate Capital
“We value our ongoing relationship with Aligned Climate Capital and are pleased to support ASP6 as a construction lender. This portfolio reflects the kind of thoughtful, well-structured projects Seminole looks to finance. These are investments with strong fundamentals that also deliver meaningful impact in the communities they serve.”
Joe Ritter, principal of Seminole Financial Services
“In this unstable market, it’s good to have partners like Aligned who not only commit to building solar projects but deliver on that promise. We’re proud to help Aligned grow their distributed solar portfolio and deliver meaningful, low-cost, clean energy projects to the grid.”
Pat Jackson, co-founder and managing member of ReWild Renewables
