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China Huaneng Group has obtained CNY 15 billion ($2.1 billion) in equity financing for its renewable energy subsidiary, Huaneng Renewables, from five major state-owned entities. The deal, the largest renewable equity financing transaction of 2024, will reduce financial pressures for Huaneng Renewables and support its wind and solar projects.
China Huaneng Group, the countrys largest state-owned energy enterprise, has signed agreements with five major state-owned entities to inject CNY 15 billion into its renewable energy subsidiary, Huaneng Renewables.
The capital infusion is the largest equity financing deal in the renewables sector this year. It involves contributions from China Reform Holding Corp., China Post, China Taiping, the National Green Development Fund (NGDF), and China Southern Power Grid.
Huaneng Renewables – founded in November 2002 with CNY 10.57 billion of initial registered capital – is a key platform for developing and operating renewable energy projects, including wind and solar power. Huaneng Group remains its largest shareholder.
Huaneng Renewables wind and solar capacity reached 28.46 GW by the end of 2023, a 623% increase from 2021. But the company faces financial pressures from high capital requirements for renewable energy projects and delays in government subsidies for feed-in tariffs. This equity financing round will reduce financial strain by significantly lowering the debt-to-asset ratio for both Huaneng Renewables and its parent company.
The new investors bring financial resources, technological expertise, collaboration opportunities, and enhanced capabilities to support the renewable energy transition. This move underscores China’s commitment to decarbonization and scaling up renewable energy to meet its long-term climate targets. |
