Ares–EDPR: $1.73m/MW EV multiple for Sonrisa as PE capital returns to de-risked CAISO hybrids

Ares Management will acquire an 80% stake in EDPR's Sonrisa solar-and-storage project in CAISO, while EDPR retains 20%. The deal values 100% of the project at an enterprise value of $800mn, or approximately $1.73mn/MW. Expected proceeds of about $450mn imply an equity value of approximately $560mn on a 100% basis, or $1.2mn/MW. Half will be paid at financial close and the remainder at COD. A 20-year solar PPA with Ava Community Energy and a 20-year battery capacity toll secure both revenue streams.

1. Contracted revenues, tax certainty and lower completion risk strengthen Ares' acquisition rationale

Sonrisa offers Ares a long-dated, contracted revenue profile. The solar PPA covers energy and environmental attributes, while the battery toll limits Ares' exposure to dispatch and market risk. Both agreements also allow part of any tariff-driven equipment cost increase to be shared with the off-taker, reducing Ares' exposure to construction-cost escalation. Ares further limits upfront exposure, paying 50% of the consideration at financial close and 50% at COD.

Sonrisa's tax and interconnection positions further strengthen the buyer case. The project reached FID in August 2025 following enactment of the OBBBA, improving tax-credit visibility for the solar and storage components. Sonrisa will also share a 230-kV transmission line, substation and O&M facilities with EDPR's adjacent Scarlet complex, giving it a lower-cost delivery and operating model with less execution risk than a stand-alone build.

2. CAISO hybrid deal activity is reviving, but sponsor capital remains focused on de-risked projects

Private capital is concentrating on CAISO projects that have already cleared the hardest execution hurdles. Enerdatics tracks seven CAISO solar-plus-storage transactions since 2023 involving assets or portfolios with a construction-stage component: three in 2023, one in 2024, one in 2025 and two through July 2026. Across those transactions, the buyer screen has remained consistent: secured interconnection, long-term contracted revenues and a clear path to delivery. Sonrisa sits at the de-risked end of that spectrum, with construction underway, both revenue streams contracted for 20 years and COD scheduled for December 2026.

Direct project-level investment by private infrastructure funds remains selective, but Ares is not an outlier. AIP, Power Sustainable and Axium have all taken direct stakes in CAISO solar-plus-storage projects after Clearway, EDF and Terra-Gen had advanced construction and secured long-term offtake, with the developer retaining equity, operating responsibility or both. Sonrisa follows the same model but at a larger ownership level: Ares is taking 80%, versus 50%–60% in the closest precedents, while EDPR retains 20%. Together with Ares' 49% investment in a 1.6 GW EDPR portfolio in October 2025, the deal points to a repeat-partner strategy rather than a one-off PE bet on a single asset.

3. Sonrisa's $1.73mn/MW EV reflects premium contracted economics and EDPR's tax-equity strategy

The $1.73mn/MW headline captures Sonrisa's full enterprise value. EDPR's $450mn of proceeds for 80% imply a $560mn equity value on a 100% basis, leaving a roughly $240mn gap that likely reflects project financing, including tax equity.

This aligns with EDPR's strategy: it has raised approximately €6bn of tax-equity proceeds to date and €0.8bn in 2025, and targets €1.5bn over 2026–28 to fund around 40% of gross US investment. A growing solar and BESS mix should drive more ITC-based deals, lowering Ares' equity need while letting EDPR monetize tax benefits alongside the sale.

At $1.73mn/MW, Sonrisa sits 25% above the $1.38mn/MW CAISO median and 13% above the $1.53mn/MW US construction-stage benchmark. It is broadly in line with Ares' 2025 EDPR portfolio at $1.78mn/MW and approximately 43% above Sandrini at $1.20mn/MW. Its premium to Sandrini reflects 20-year contracts versus 15 years, a capacity toll rather than an ESSA, twice the storage capacity and greater post-OBBBA tax-credit visibility.

US solar-plus-storage stake sales — precedent comp set, implied EV/MW at 100%

*EV/MW figures use LEAP's implied 100% enterprise-value field. Capacity is gross, with solar in MWdc and BESS in MW; Sonrisa uses LEAP's 279 MWdc capacity (EDPR separately reports 200 MWac / 265 MWdc). Medians include only populated EV/MW records and exclude royalty interests.

Enerdatics · Proprietary research. Sources: EDPR market notifications and investor presentations; Enerdatics LEAP. Not investment advice.