October 20th, 2026 | 05:42 CEST
Enel, NextEra Energy and RE Royalties: Solar Power as a Source of Revenue
When energy companies such as Enel acquire solar parks and NextEra Energy expands its portfolio of renewable energy projects, it highlights what these businesses are really focused on: predictable returns from renewable energy assets are in greater demand than ever. RE Royalties' business model is built around precisely this concept. The financier participates in revenues from similar projects without necessarily owning them outright at scale. To fund its growing project pipeline, RE Royalties is currently exploring strategic options, including a potential sale of the business.
time to read: 3 minutes | Author: Nico Popp
ISIN: RE Royalties Ltd | CA75527Q1081 , ENEL S.P.A. ADR | US29265W2070 , NEXTERA ENERGY INC.DL-_01 | US65339F1012
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Author
Nico Popp
At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.
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Enel: Acquisition of Completed US Solar Power Plants
Italian utility Enel is securing a steady stream of income by acquiring completed facilities. In early October 2026, Enel Green Power North America completed the acquisition of seven operating US solar power plants. Purchased from a US utility, the facilities have a combined capacity of approximately 270 MW. The purchase price was around USD 140 million.
NextEra Energy: Project Pipeline Expands Rapidly
NextEra Energy also illustrates the scale of the market. The US utility is pushing ahead aggressively with the expansion of its renewable energy projects. In the second quarter of 2026 alone, NextEra Energy added another 3.6 GW to its backlog of contractually secured wind, solar and energy storage projects. The company is due to release its latest third-quarter results before the US market opens on Wednesday. These developments highlight the extent to which energy companies are focusing on long-term, predictable projects in the renewable energy sector.
RE Royalties: Financing in Exchange for a Share of Revenue
RE Royalties capitalises on precisely these recurring cash flows from green energy projects. The company provides developers with capital, often as a combination of a secured loan and a long-term revenue share. Depending on the project, royalty rates range from less than 1% to double-digit percentages. Since late 2024, the company has also operated its own battery storage systems and rooftop solar installations in Ontario. The portfolio comprises 129 royalties as well as company-owned facilities, totalling around 140 projects. According to the company, the portfolio has generated an unlevered internal rate of return (IRR) of over 19% since inception. However, RE Royalties recorded a pre-tax operating loss of CAD 1.053 million in the first half of 2026. The company distributed CAD 0.03 per share for 2025, but since December 2025 the board has set the dividend to be paid only annually; it had not approved any distribution for 2026 by the end of August.
RE Royalties: Strategic Review and Deal Pipeline
At the end of March 2026, RE Royalties launched a formal strategic review and appointed PwC Corporate Finance as financial adviser. A special committee of the board is examining options such as partnerships, financing or the sale of the entire company, with no predetermined outcome. One reason for this step is the capital required for new growth. According to the company, the indicative pipeline comprises more than 20 potential clients with a volume of several hundred million CAD. With a recent market capitalisation of around CAD 13 million, RE Royalties can hardly finance this from its own resources. In March 2026, Altius Minerals demonstrated that royalty portfolios can find buyers by acquiring Lithium Royalty Corp. for around CAD 520 million. However, this involved commodity royalties, not renewable energy. By August, RE Royalties had invested a total of USD 4.8 million in royalties on the Solaris portfolio in three tranches. A non-binding letter of intent (LOI) provides for up to a further USD 62.7 million, bringing the total to up to USD 67.5 million.
Conclusion: Could the Strategic Review Mark a Turning Point?
The ongoing strategic review could clarify the value that potential buyers or partners place on RE Royalties' portfolio. According to the company, discussions are taking place with various interested parties, although no outcome is guaranteed. Significant risks accompany the opportunities: management acknowledges material uncertainties. With negative equity (CAD 6.9 million at the end of June 2026) and the pipeline likely to require dilutive capital measures unless a partner or buyer is secured, new approaches are needed. Whether the review will lead to a transaction remains entirely uncertain, although the underlying conditions for the business model are favourable. RE Royalties shares are currently a speculative investment.
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