This Series B growth investment from Nuveen will support the continued development of Perch's leading clean energy tech platform, fund expansion into new sales channels, products, and community solar markets, scale operations and customer care services, growth management talent, and fund strategic partnerships.
The partnership will also provide Perch with access to Nuveen's strategic portfolio of affordable housing units and residential apartments. Reaching low-to-moderate-income (LMI) consumers is key to democratizing solar energy and ensuring that the clean energy future is equitable. Nuveen's established real estate portfolio combined with Perch's scalable and easy-to-use service will help get community solar to more households who stand to benefit most.
"Nuveen's financial and strategic support comes at a pivotal moment which will not only accelerate Perch's growth and clear focus on supporting our solar developer clients, but will create opportunities for consumers of all economic backgrounds to join in on clean energy savings, especially the millions of people who can't afford or don't have a home suitable for rooftop panels," said Bruce Stewart, Perch Energy President and CEO.
"Perch's community solar platform allows everyone to access the cost-savings of solar power, especially those who need it most, while supporting a cleaner energy future. Bolstering Perch's already robust anchor, commercial, residential and low- and middle-income customer acquisition capabilities, Nuveen's investment and affordable housing portfolio makes us even stronger to deliver on our client's capacity targets and to meet the LMI mandates in both state and federal IRA regulations. Most importantly, it broadens our horizons for delivering discounts on electric bills to those facing barriers to entering the clean energy economy."
Nuveen is a pioneer in impact investing, with a long track record of driving strong financial results and a positive influence for society's most pressing problems. The firm made its first impact investment in the 1980s and now manages over $1.0 billion in private equity impact capital. The Private Equity Impact team seeks to drive an inclusive transition to a low carbon economy, targeting disruptive businesses that reduce waste and emissions, use resources in a circular manner, and expand access to and reduce the cost of basic products and services for underserved consumers.
"Community solar is key to providing a renewable energy option to those Americans who do not have access to rooftop solar," said Radhika Shroff, Managing Director, Private Equity Impact at Nuveen. "We are excited to bring our impact expertise and broader Nuveen platform to Perch to provide inclusive access to solar savings for households. Our investment in Perch is emblematic of our focus on investing in companies that deliver both financial returns to our investors as well as an inclusive transition to a low carbon economy."
"In most cases, access to community solar is the only way to make it possible for households residing in affordable housing to participate in solar programs, and in turn support the necessary strategies to combat global warming. Perch is establishing a wonderful roadmap for affordable housing developers and residents to focus on energy efficiency for a clean, resilient future," said Jason Acosta, Head of Asset Management, Impact Investing at Nuveen Real Estate. "This partnership will assist Nuveen in extending its mission of providing high-quality services that elevate the lives of our valued residents and add stability to the surrounding community."
Today, Perch provides acquisition and management services for more than 140 active community solar projects owned by the top developers and asset owners. Following its launch as an independent company in 2021 and announcement of its Series A closing, Perch has doubled the number of clients and markets it serves while continuing to expand with current clients, increased its management capabilities, has contracted more than 250 MWs and grown contracted annual recurring revenue by approximately 30% in six quarters.
Community solar projects are locally built clean energy projects that are connected to the electrical grid and serve to replace energy from fossil fuels, thereby lowering carbon emissions and pollution in local communities.
Residential households plus small and large businesses can easily sign up and subscribe to a local solar project with no upfront cost, and then receive energy credits off their electricity bills, reducing what they owe their utility company. Importantly, community solar does not require on-site installation for consumers, significantly expanding its access to all types of consumers including renters and lower income families. Wood Mackenzie forecasts that existing community solar markets will grow by an annual average of 8% with nearly 14 gigawatts (GW) of cumulative capacity expected by 2028, excluding the potential of new programs that could add significantly more.