A service of

Nautilus Solar aims for 1GW in five years via acquisitions, CEO says

Nautilus Solar, a Summit, New Jersey-based community solar company, will continue its steady acquisition pace of around 250MW per year, said CEO Jeffrey Cheng.

Nautilus is currently in 10 states and expects new states to continue to initiate or expand community solar programs, he said. It expects to grow exclusively in the US for the foreseeable future, as Canada does not currently have community solar programs, he said. Some large states, like California and New York, may be able to support large amounts of growth for years to come, he explained.

Nautilus has a group of “core developers” that take on the earlier greenfield projects and develop them to a point where Nautilus can acquire them, he said. While the company will acquire projects in various stages from early to late stage to operating, the later stages are its strength, he said.

Its “sweet spot” is financing, building and owning solar assets for the long term, he said. Nautilus isn’t interested in flipping assets or the company, as it is owned by alternative asset manager Power Sustainable Capital, itself a subsidiary of Montreal-based Power Corporation of Canada [TSX:POW]. Through its parent company, it has access to “more equity capital than we can use,” as it wants to grow in a sustainable way with quality assets, and managing excessive growth can be an issue for companies, he said.

For project financing, it will typically go out to a group of tax equity providers as it doesn’t want to be tied down to one provider. It will also look to finance portfolios rather than “just one project at a time,” he said. For project debt, it usually uses its syndicate led by National Bank of Canada, he added.

The Inflation Reduction Act will give a boost to Nautilus and the community solar industry by extending certain investment tax credits and providing other incentives, he added.

Nautilus manages 25k direct and indirect subscribers. It has almost 100 employees and will have more than 100 by the end of next year.