While the renewable energy sector is going through a difficult period on the stock market, the Caisse de dépôt et placement du Québec has once again released tens of millions to massively purchase Boralex shares on the open market.
After purchasing nearly $50 million worth of shares in the Quebec renewable energy producer last summer, the Caisse purchased almost as many additional millions in October.
The largest institutional investor in Quebec purchased a total of 1.4 million Boralex shares from October 10 to 25. The Caisse also purchased 1.4 million shares on the market between mid-July and September 1.
The Caisse notably purchased 301,500 shares during the session of October 20 alone, according to what indicates a document filed Friday with the stock exchange authorities.
The regulatory document just filed specifies that the Caisse began the month of November with a 15.3% stake in Boralex. This is a significant increase since it stood at around 13% at the start of the year.
The main shareholder of Boralex, the Caisse held 15.7 million shares in the company as of November 1.
If the clean energy sector was popular with investors two years ago, things have changed a lot.
Boralex shares are worth $28 today, whereas they were trading at more than $55 in January 2021. The shares of Innergex – another Quebec producer – also reached their peak in 2021, but have since lost 70% of its value.
The Invesco WilderHill Clean Energy exchange-traded fund – a benchmark for taking the pulse of the market’s clean energy sector – is down about 30% this year, similar to Boralex’s stock performance in 2023 .
The increase in financing costs is a significant obstacle for Boralex and its growth ambitions (new projects and those under construction or ready to build).
To protect itself and maintain acceptable returns on its projects, Boralex must transfer cost increases to its customers by demanding higher prices when signing electricity supply contracts.
The big boss of Boralex, Patrick Decostre, remains confident about the prospects in the current and future context of the fight against climate change.
“Demand is stronger than ever, in particular thanks to the commitment of States to reduce their carbon footprint and the competitiveness of renewable energies compared to other forms of production”, he underlined last Thursday, at the time of the presentation of Boralex’s most recent quarterly financial performance.
Renewable energy is a niche in which the Caisse likes to invest and the relationship with Boralex is not new. The Caisse’s initial investment in Boralex dates back more than 20 years ago.
“We are very present in the field of renewable energy, and Boralex is a key player in this sector,” underlines Caisse de dépôt spokesperson Kate Monfette.
“The Quebec company, which actively participates in the fight against climate change through its profitable and sustainable growth, has more than doubled its installed power over the last five years through a portfolio of wind power projects, solar and storage,” she adds.
