Introduction

Solaria is one of the leading renewable energy companies in Europe. Historically focused on photovoltaic energy in Spain, but also present in Portugal, Greece, and Italy, it has recently started diversifying into wind projects (UK) and initiated storage projects. Similarly, it has launched an infrastructure division to own the land where renewable projects are developed and has focused on the opportunity in Data Centers, where it expects to capitalize on the high demand from technology companies.

This is not the first time we’ve analyzed Solaria – in fact, the renewable sector is one we have been quite active in over the past few years. Primarily with Ecoener, but also in 2020 and 2021 with Greenergy, or the takeovers of Greenvolt and Greenalia. The situation is radically different now compared to late 2021, due to the rise in interest rates, the new regulation introduced in Spain in 2023, and investor sentiment towards the industry (it was one of the downsides of the Trump trade). This, along with a few issues we’ll explore in more detail, has left Solaria’s stock at a 5-year low.

Solaria was created in 2002 by its current CEO, it went public in 2007, but it was not until 2019 that it began its growth phase. In just over 5 years, combining ambitious goals and the best execution in the sector, it has multiplied its installed capacity by 20 times, going from 75MW at the end of 2018 to the current 1658MW (without the need of any capital increases). And it is this excellent execution capability – along with lower Capex per MW compared to its peers – that has allowed it to trade at a premium relative to the rest of the sector in recent years.

However, as shown in the image #2, it has gone five consecutive quarters without bringing new capacity online due to issues with contractors and small companies involved (details to follow). This is not expected to change until, at the earliest, 2Q25, which has understandably weighed on its market capitalisation which has gone from over €3Bn to €1Bn in just over 24 months.

Today, we analyze Solaria in detail to quantify the size of the opportunity the market is offering and the risks and key topics to consider for anyone interested in the company and the renewable energy sector.

  • We have mapped all its assets (MW, equivalent hours, MWh generated, etc.), its signed PPAs (and their prices), and government auctions (obtained at fixed prices for 10-15 years). We also analyze electricity prices, forward PPAs, and the expected situation in the coming months.

  • We analyze and explain in detail the new Data Centers and Infrastructure divisions.

  • Similarly, we have analyzed its debt (88% fixed/swapped), dividing it into project finance (with an educational explanation of how it works) and bonds, providing individual details of each and explaining the importance of the agreements with Santander and the European Investment Bank.

  • A review of its economics and Solaria’s valuation using two different methods.

  • To support all this, we have enabled a downloadable Excel file.

 

 

 

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