Online search and advertising giant Google is teaming with investment firm Kohlberg Kravis Roberts & Co. to develop four solar energy farms serving the Sacramento Municipal Utility District in California.
Google said Tuesday on its Green Blog that it will spend $94 million on the projects. They also will receive equity from SunTap Energy RE LLC, a venture formed by KKR to invest in U.S. solar projects.
The projects are expected to provide enough energy to power more than 13,000 average U.S. homes. Energy produced by three of the projects is contracted for 20 years with the utility district, Google said.
Construction on three of the four projects will be complete early next year, with the fourth coming on line later in the year.
KKR said SunTap represents its first U.S. renewable energy investment. It also has invested in a French wind park operator and a Spanish solar energy company.
Google said it has invested more than $915 million in clean energy projects, including $800 million this year. The Sacramento deal represents its first U.S. investment in a large-scale solar project that generates energy for a grid, rather than individual rooftops.
The investment comes as the solar industry wraps up a difficult year in which it has been hit hard by slower economic growth around the world, including the U.S., where government funding for alternative energy projects has been squeezed.
First Solar, the nation's largest solar company, has cut earnings and revenue estimates for 2011. The company, based in Tempe, Ariz., expects to report charges of 85 cents per share related to a series of cost-cutting moves this year, including layoffs of about 100 people.
In September, California solar panel maker Solyndra LLC, which received a $528 million federal loan and was touted by the Obama administration as a "green jobs" creator, filed for bankruptcy court protection. A Massachusetts company, Beacon Power, has since blamed its bankruptcy filing on the political fallout from Solyndra's failure.