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Canadian Solar (CSIQ), Goldman Sachs Ink Solar O&M Deals

Canadian Solar Inc. CSIQ recently inked long-term Operations & Maintenance (O&M) contracts with California’s Slate and Mustang solar projects, both developed by its subsidiary Recurrent Energy. These agreements will strengthen Canadian Solar’s position as a leading solar and energy storage O&M provider.

In particular, with these contracts, Canadian Solar will be able to proceed a step ahead in achieving its target to reach 11 gigawatt-peak (GWp) of operational solar projects by 2025.

Details of the Deal

Owned by Goldman Sachs Asset Management Renewable Power, a unit of Goldman Sachs GS, both the aforementioned projects are solar plants equipped with a battery storage system. Per the terms of the agreements, Canadian Solar will conduct various O&M operations across both projects, like plant monitoring, performance management as well as corrective maintenance.

The company will also aid in increasing site availability, minimizing downtime, and maximizing the value of the projects.

Canadian Solar’s Position in the Solar O&M Market

Realizing the dire need for decarbonization, the entire world is rapidly going through a transition process toward a greener environment, wherein solar power plays the role of a key catalyst. The aggressive growth of the solar market has boosted the prospects of the solar O&M market since speedy repowering and proper maintenance of the solar power plants remain the need of the hour.

Wood Mackenzie projects the global non-residential solar PV O&M market to reach an annual total of $9.4 billion by 2025.

Interestingly, Canadian Solar has been providing O&M services for solar power plants in commercial operation since 2012. Currently, the company enjoys a global O&M portfolio of nearly 4 GWp of solar and 860 MWh of storage projects under contract across nine countries, of which 2.3 GWp of solar projects are currently in operation.

Considering the aforementioned solar O&M market prospects, Canadian Solar seems well poised to grow, with the latest agreements paving the way for its further expansion in the space.

Peer Prospects

Apart from Canadian Solar, other industry players engaged in O&M services are also expected to reap the benefits of the growing solar O&M market.

For instance, SunPower SPWR provides O&M services to its residential customers and some selected large utility-scale power plant projects in North America.

Another solar player, Azure Power AZRE offers O&M services without involving multiple third-party services. It currently has a solar assets base of over 7 GWs including 2 GWs of operational capacity.

Price Movement

Shares of Canadian Solar have surged 20.7% in a year’s time compared with the industry’s 20.5% growth.

Image Source: Zacks Investment Research

Zacks Rank

Canadian Solar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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The Goldman Sachs Group, Inc. (GS): Free Stock Analysis Report
Canadian Solar Inc. (CSIQ): Free Stock Analysis Report
SunPower Corporation (SPWR): Free Stock Analysis Report
Azure Power Global Ltd. (AZRE): Free Stock Analysis Report
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