Goldman Sachs, Cleanhill Partners acquire majority stake in EPC Power

EPC Power Corp., a North American supplier of high-performance, utility-scale, smart inverters, announced the Sustainable Investing business within Goldman Sachs Asset Management and Cleanhill Partners have acquired a majority stake in its company.

Cleanhill Partners, first invested in EPC Power Corporation in 2021 when it underwrote a credit facility to support its growth; since then, the firm has also provided counsel on operational matters and facilitated strategic partnerships to help the firm achieve rapid scale.

What does the transaction mean for EPC Power?

The strategic investment, along with a comprehensive recapitalization, positions EPC Power Corporation to expand and deliver against rapid growth in the renewable energy storage markets while helping facilitate the United States economy’s clean energy transition.

The transaction follows the signing into law of the Inflation Reduction Act of 2022, which among other provisions extends a first-ever tax credit to stand-alone energy storage, creating a significant financial incentive for adopting EPC Power’s inverters and other tech.

EPC Power is the only U.S.-based, end-to-end power conversion solution provider, making its technology well-suited for grid-scale applications that require added layers of security.

Commenting on the transaction, Co-founder and Chief Executive Officer of EPC Power Corp., Devin Dilley said, “EPC Power is proud of the strong reputation and track record we’ve built by focusing on product innovation and forging deep relationships with our customers.”

“As the world becomes more reliant on renewable energy, inverters need to continue to get smarter. Goldman Sachs and Cleanhill Partners are committed to investing in EPC Power to capitalize on this market opportunity and to positively impact the U.S. energy transition.”

What were the investors’ thoughts on EPC Power?

“In an exploding market of cleantech innovators, EPC Power stands out for its tech, which supports the renewable energy transition while preserving grid reliability and performance,” commented Rakesh Wilson and Ash Upadhyaya, managing partners at Cleanhill Partners.

“We have every confidence that the firm will meet its environmentally critical objectives. We are excited to partner with Goldman Sachs for the next stage of EPC Power’s growth.”

“EPC Power is uniquely positioned to play a critical role in the evolution of the U.S. solar and energy storage value chains and is now well capitalized to continue its trajectory of rapid growth,” said Alexander Mass, managing director of Goldman Sachs Asset Management.

“As the only scaled supplier of smart inverters that are designed, engineered and 100% manufactured in the U.S., EPC Power is a natural continuation of our thematic investment activity in this space, in partnership with Cleanhill Partners and EPC management.”

What is the market offering of EPC Power?

Energy storage installations globally are projected to multiply 20 times by the end of 2030 compared to the end of 2020, according to BloombergNEF’s 2021 Global Energy Storage Outlook. The U.S. is currently the world’s biggest market for energy storage.

EPC Power’s inverters are suited for applications in stand-alone energy storage, solar energy storage and data center backup power. They enable the buildout of battery storage required to support the proliferation of renewable energy generation. Going beyond the role of traditional inverters to feed power into the grid, “smart” inverters are powered by advanced software and work with the grid to increase resilience, reliability, safety and security.

EPC Power has sold over two gigawatts of smart inverters. EPC Power is based in Southern California, operating its first manufacturing facility in Poway in San Diego County, with a second U.S. manufacturing location on the East Coast scheduled to open in late 2022.

To support its growing customer base in Europe, EPC Power also maintains an engineering and sales office in Helsinki, Finland. The firm employs 180 people. William Blair served as the financial advisor to EPC Power; Foley & Lardner as legal counsel to EPC Power; Vinson & Elkins and Kirkland & Ellis served as legal counsel to Goldman Sachs and Cleanhill Partners.