Marubeni acquires Taiwan’s Chenya Energy

It is the first time Japanese general trading company Marubeni Corporation invested in Taiwan’s renewable energy market. According to Nikkei’s report, Marubeni will spend more than 10 billion yen (or over NT$2.7 million) for a 100% stake in Chenya Energy as well as its green power generation facilities with a total capacity of 270MW.

Based on the Taiwanese government’s construction plan, it aims to build itself a solar power generation capacity of 6.5GW in 2020, and to further raise the number to 20GW in 2025. The plan has attracted a number of overseas companies for the opportunities.

Among them, Marubeni is Japan’s largest and the 11th largest coal-fired power company in the world. However, as global warming has taken more focus from the world, the high risks in fossil fuel energy investment trigger the company to seek energy transformation since September, 2018. The company expects to cut down coal-fired generation in half by 2030 and raise its current solar energy generation ratio from 10% to 20% by 2023.

Marubeni’s past investment in Taiwan targeted at coal-fired business including joint investment with Ever Fortune Group in 960MW in Ever Power gas-fired combined power plant project, as well as the recent purchase order of 2GW gas-fired power plant from Taipower. This first successful investment in Taiwan’s renewable energy via acquiring Chenya enables Marubeni to build expertise in floating solar energy and enter other Asian markets as well. Nikkei pointed out that with more companies entering Taiwan, Marubeni hopes to carve out a share of the market by getting involved in projects from the development stage.

Chenya Energy has been focusing its business in middle and large scale solar plants in the country. The firm has been wholly owned since 2017 by a US-based large infrastructure investor, I Squared Capital, which plans to increase its investment in at least 500MW of solar power generation assets in Taiwan within the next 3 years.

Currently I Squared Capital has agreed to Marubeni’s acquisition of Chengya through SQ Global Infrastructure Fund, and completed the stock purchase agreement. In near future, Chenya will become a wholly owned subsidiary of Marubeni.

I Squared Capital managing partner Gautam Bhandari said that Chenya’s solar power generation capacity has taken a leap from 2.3MW to 344.4MW within the past 3 years, covering floating, ground-mounted and rooftop projects. The company is currently building the world’s largest floating solar project.