The Board of TRIG is pleased to announce that the Company has exchanged contracts to acquire a 75% interest in Ersträsk Wind Farm ("Ersträsk" or the "Project"), a 229.1MW onshore wind farm near Piteå in Northern Sweden. The Project is being acquired from Enercon Independent Power Producer GmbH.
Ersträsk is currently under construction and will be comprised of 26 Enercon E-103 turbines of 2.35MW capacity each ("Phase 1") and of 42 Enercon E-126 turbines of 4.0MW capacity each ("Phase 2"). Phase 1 is expected to become operational in Q1 2019 and Phase 2 in Q1 2020.
Payment to the vendor for each of the two phases will be made only as each phase commences operation and is expected to be approximately €190 million in total. The investment will be ﬁnanced by the Company's revolving acquisition facility. The project has no third-party debt.
Renewables in Sweden receive the benefit of a 15-year green certificate, but the substantial majority of revenues come from power sales. Ersträsk has already entered into hedging agreements for fixing power prices for the next 2 years for all of Phase 1 and a portion of Phase 2 expected generation and intends to utilise hedges on an ongoing basis to manage exposure to power price variations
The Company announced on 1 August 2018 that it was in advanced discussions to invest in the Project. The Company has a strategy of diversifying risk by investing in multiple renewables and related technologies, jurisdictions and climate systems within its geographical focus of Northern Europe. Ersträsk, the Company's first investment in Sweden, provides further portfolio diversification of regulatory regimes, weather systems and power price markets. The acquisition will increase TRIG's geographical diversification by taking its investments outside of the UK to 28% of the portfolio.
Richard Crawford, Director, Infrastructure at InfraRed Capital Partners, said:
"Ersträsk is an important transaction for TRIG and its first investment in the Nordic region. This acquisition enables TRIG to further improve its geographical diversification and establish TRIG's presence in one of Europe's most attractive regions for renewable energy development. The investment fits nicely within the portfolio alongside TRIG's other acquisitions in 2018 in France, the UK and Ireland with their strong Feed-in-tariff and Contracts-for-difference support mechanisms."
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