BP Energy Partners-backed Catalyst Power is exploring acquisitions of retail gas and energy businesses in New England, New York and throughout the PJM region, the company’s chief executive tells Infralogic.

The company is also in talks to syndicate some of its development stage commercial and industrial (C&I) solar assets, Gabe Phillips, CEO and founder of Catalyst Power, said.

Catalyst is seeking stand-alone retail gas and energy businesses within its target footprint as part of a broader strategy to build out the potential customer base for its C&I solar business and other decarbonization offerings, Phillips said.

“We intend to continue to be active in our acquisition strategy on the retail side. The Northeastern quadrant of the US has been and continues to be our focus,” Phillips said.

Retail companies like recently-acquired Robison Energy in New York help Catalyst establish relationships with individual energy consumers that may benefit from Catalyst’s decarbonization services. This includes development and operation of its proprietary C&I solar systems called Connected Microgrids, execution and management of community solar contracts, and installation of gas-fired cogeneration facilities that improve efficiency by combining heat and energy production for industrial clients and large buildings, Phillips said.

“We get close to them as our customer, first on the energy supply side business. Then we know what they consume and how they consume it, how much it costs them, and we leverage that relationship to suggest things that they might either implement themselves or adopt,” he said.

The acquisition of Robison aligns with Catalyst’s other retail assets in New York state: organically created Catalyst Power and Gas, as well as US Energy Partners and AP Gas & Electric which Catalyst acquired in 2021.

All Catalyst’s development and acquisitions to date, including Robison, have been financed on book, with the backing of BP Energy Partners, without acquisition financing.

The company has relied on non-bank processes for all its successful acquisitions to date, said Phillips. But Catalyst has worked with outside advisors on processes that did not ultimately result in a transaction, and the company is open to working with advisors in the future.

Catalyst’s decision to stay in-house for its acquisitions is, in part, a function of the standalone, independently owned assets it looks to acquire. The acquisition costs for Catalyst’s past transactions have not been made public. But, Phillips says, the dollar value of the deals is comparatively small.

That creates less opportunity for outside financing or advisors to get involved. But it also means better returns for Catalyst, because there is not as much competition for such transactions as there is for larger assets or portfolios.

“We tend to operate on the smaller side of the spectrum of transaction size. You need to aggregate, and that takes time, and you need to do that on balance sheet before you’re at a scale where third-party financing is attractive and accretive,” said Phillips.

Phillips also told Infralogic that Catalyst has entered into active talks to syndicate some of its C&I assets. Phillips declined to say what size portfolio the company is bringing to market.

“We are exploring various structures to maximize value,” he said.

Catalyst has set up its portfolio in a way that makes aggregation and monetization of its DG assets a straightforward process, should the company decide to execute a sale, said Phillips.

With regard to its growing retail portfolio, Phillips says Catalyst will hold on tightly to those, because of the critical role the play in building and maintaining relationships with potential customers for its decarbonization services.

“We are set up in a way where we can monetize our assets easily and maintain the customer-facing entity. That’s important for us, because the customer represents multiple opportunities to deploy renewable assets and distributed decarbonizing assets, not just a singular opportunity,” he said.