An investment by APG in Doral Renewables has led to the creation of one of the largest solar projects in the United States.The terms of the deal, a USD 400 million minority equity investment, which was announced in June were finalized last week by APG, on behalf of its pension fund client ABP. Given the unique nature of the underlying assets as well as the ownership structure with innovative downside protection, Doral Renewables qualifies as a Signature Investment. Additionally, Doral Renewables will increase ABP’s exposure to renewables and fuel the development of a significant solar pipeline. As such, the investment qualifies as an Impact Investment as well as a 100% Majority SDI transaction. APG’s Sarah Shin (Portfolio Manager, Americas Infrastructure) and Sean Hannon (Senior Portfolio Manager, Americas Infrastructure) explain the key details of this deal.
In a nutshell
• Agrivoltaics, which involves the mixed use of land for both agriculture as well as renewable energy production, is gaining traction in the United States, and APG aims to partner with Doral Renewables to push it further.
• All of Doral’s projects are constructed only on tillable acres and feature solar panels on 20% of the land with the remaining 80% remaining green or used for vegetation.
• For APG, Indiana serves as the gateway to the Midwest, enabling further diversification of its U.S. solar portfolio.
On a site where mammoth bones were once discovered lies the Mammoth North solar project. It marks the first phase of a larger US$1.5 billion project that is expected to generate 1.6 gigawatts of energy. Once finished, the project will supply electricity to roughly 275,000 U.S. households annually.
APG brings nearly a decade of experience investing in the U.S. renewable energy market into this partnership with Doral Renewables, a U.S. developer, owner, and operator of renewable energy and storage projects. So, what does APG offer beyond funding?
Hannon: “Mammoth North is Doral’s first solar project. APG itself has a multi-gigawatt renewable energy portfolio. We initially started by acquiring fully operational assets, but we’ve since gained the experience of taking projects from what we call ‘greenfield’ to full operations. We also bring a wealth of expertise and best practices in the United States renewables market. Beyond providing equity, we contribute knowledge on attracting additional funding, like tax equity. Thanks to the size of our renewable energy portfolio, we also know which equipment suppliers to work with and ideal target markets for growth. Moreover, we’ll be joining the board and sharing insights on potential risks and how to mitigate or overcome them. So, it’s not just a matter of writing a check and walking away—we’ll be very involved moving forward, not only in this project but also with Doral Renewables as a whole. Doral is a relatively young company, and we can help them establish policies and best practices.”
Are there particular challenges that could slow down the development pipeline?
Shin: “There’s a lot involved in solar development. You need to identify and secure the land, line up contracts, and ensure that all regulatory approvals are in place. Additionally, you need to keep everything on schedule so that components like panels and inverters arrive on time. But these challenges are common across the entire solar industry.”
Why was Indiana chosen, given that it’s not known as the sunniest state in the U.S.?
Shin: “From APG’s perspective, we wanted to diversify our existing solar portfolio, which already has significant investments in the West. This project gives us exposure in the Midwest, further enhancing our geographical diversification.”
Hannon: “Indiana gets about 85% of its power from coal and natural gas, one of the highest concentrations in the country. By contrast, states like California rely heavily on solar and wind. In Indiana, replacing coal-generated power with solar energy has an outsized impact by reducing emissions, making solar even more valuable in that context.”
Agrivoltaics is a new and growing concept in the U.S.
There have been local protests in Indiana about the Mammoth solar project. Is APG working with Doral Renewables to address these concerns?
Hannon: “The biggest need for a utility-scale solar project like this is land—currently about 10 square miles. Historically, this was easy because projects were built out West on government-owned desert land. Now that solar projects are spreading across the country, they’re reaching more populated areas, meaning agreements with landholders are required. In this part of the country, that means farmers. Some were initially hesitant about transforming farmland into a solar project, concerned about the future of farming in their community. It’s important to note that no one is obligated to participate. Doral Renewables is working closely with the community through an agrivoltaics program, which allows dual use of the land. Only about 20% of the land is used for solar panels, while the rest remains available for farming. The main impacts on the community from the Mammoth project are job creation and positive tax revenue.”
Shin: “Local engagement is key due to the dual use of the land. Doral Renewables is developing solar power on farmland, and the current farmers—mostly corn growers—are actively involved in the project. Agrivoltaics is a new and growing concept in the U.S., with many conferences for farmers and developers on this topic. People are starting to embrace the idea, which helps ease some of the community’s concerns. Doral Group already has experience in agrivoltaics, and we’re working with them to advance this concept in the U.S.”
Does APG have a plan to scale up agrivoltaics?
Shin: “We’ve been researching agrivoltaics extensively and realized that to truly make an impact on agricultural land, it needs to be integrated from the beginning of the planning process, rather than repurposing existing operations. That’s why our partnership with Doral Renewables is so impactful—they’re still early in the development process compared to some of our other operational solar investments. Starting with Doral Renewables, we’ll see how things progress and potentially expand this approach to some of our other assets. At this stage, we’re still working on a detailed strategy and collaborating with the Doral Group in Israel to implement their best practices here in the U.S.”