REG - NextEnergy Solar Fnd - New £200m Battery Storage JV Partnership

NextEnergy Solar FundAnnouncement

12/09/2022 07:00

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RNS Number : 0177Z  NextEnergy Solar Fund Limited  12 September 2022

LEI: 213800ZPHCBDDSQH5447

12 September 2022

 

NextEnergy Solar Fund Limited

 

("NESF" or the "Company")

 

New £200m Battery Storage Joint Venture Partnership

 

NextEnergy Solar Fund, the specialist solar and energy storage climate impact
fund, with a combined installed power capacity of 865MW, is pleased to
announce that it has advanced its position in the energy storage sector
through a new £200m Joint Venture Partnership ("JVP2") with Eelpower Limited
("Eelpower").

 

JVP2 reflects the successful relationship built with Eelpower, offering
enhanced terms by increasing NESF ownership to 75%, with Eelpower holding the
remaining 25%.  JVP2 is separate to the existing £100m Joint Venture
Partnership ("JVP1") announced last year.  The Company's first 50MW battery
storage project through JVP1 is currently under construction in Fife,
Scotland, and is expected to be energised and grid-connected in the first half
of 2023.

 

Energy storage remains a key strategic priority to the Company and forms part
of its long-term equity growth story.  JVP2 significantly increases the
Company's position in the UK battery storage sector and provides a unique
opportunity through both JVP1 and JVP2, to actively pursue a high-quality
pipeline of over 500MW (£300m) battery energy storage opportunities, which
are already under exclusivity.

 

Utilisation of full capacity of both JVP1 and JVP2 remains subject to
shareholder and FCA approval due to the Company's existing investment policy
being limited to 10% of Gross Asset Value into energy storage.  The Company's
investment manager and advisor, NextEnergy Capital, will be consulting
investors over the coming months to seek support to increase this limit to
allow the Company to fully capture the energy storage growth opportunities
available to the fund.

 

The Company continues to benefit from the unique skillset offered by Eelpower,
the leading specialist in the UK battery market with a strong track record and
extensive experience in the delivery, management, and optimisation of battery
storage assets in the UK.  Eelpower will provide EPC and ongoing specialist
asset management services to the storage assets.

 

Kevin Lyon, Chairman of NextEnergy Solar Fund commented:

"Battery storage is a vital technology in increasing the penetration of
renewables in the UK.  NESF has made excellent progress expanding and
diversifying into this technology through its relationship with Eelpower.
NESF has created a unique opportunity to become a key player in this space,
whilst enhancing the existing portfolio of solar assets.  Pending shareholder
and FCA approval, NESF can further diversify and offer investors continued
exciting growth prospects."

Michael Bonte-Friedheim, CEO of NextEnergy Group said:

"The new joint venture partnership builds on the successful relationship with
the Eelpower team and enhances NESF's position as a key player in the battery
storage sector.  The partnership also secures NESF an exclusive pipeline of
over 500MW of battery storage opportunities which is incredibly exciting, and
will further enhance the UK's energy independence once energised and
grid-connected."

For further information:

 NextEnergy Capital                         020 3746 0700
 Michael Bonte-Friedheim                    ir@nextenergysolarfund.com
 Aldo Beolchini
 Ross Grier
 Peter Hamid (Investor Relations)

 RBC Capital Markets                        020 7653 4000
 Matthew Coakes
 Kathryn Deegan

 Cenkos Securities                          020 7397 8900
 James King
 William Talkington

 Camarco                                    020 3781 8334
 Owen Roberts
 Eddie Livingstone-Learmonth

 Ocorian Administration (Guernsey) Limited  014 8174 2642
 Kevin Smith

 

Notes to Editors1:

About NextEnergy Solar Fund

NESF is a specialist solar and energy storage climate impact fund.  The
Company is structured as a renewable energy investment company listed on the
premium segment of the London Stock Exchange that invests in utility-scale
solar power plants and energy storage.  The Company may invest up to 30% of
its gross asset value in non-UK OECD countries, 15% in solar-focused private
infrastructure funds, and 10% in energy storage.

NESF currently has a diversified portfolio comprising of the following:

Solar PV:

·      100 operating solar assets across the UK and Italy (primarily on
agricultural, industrial, and commercial sites)

·      A 50MW co-investment into a Spanish solar project alongside
NextPower III ESG, currently under construction

·      A 210MW co-investment into a Portuguese solar project alongside
NextPower III ESG, currently under construction

·      A UK solar project under construction (Whitecross 36MW)

·      A ready-to-build UK solar project (Hatherden 50MW)

·   A $50m commitment into NextPower III ESG (a private solar infrastructure
fund providing exposure to both operating and under construction,
international solar assets)

Energy Storage:

·     A 50MW standalone battery storage project in Fife, Scotland,
currently under construction (part of a 500MW/£300m joint venture partnership
with Eelpower)

·     A 6MW co-located battery storage project at North Norfolk Solar Farm

 

The NESF portfolio has a combined installed power capacity of 865MW (excluding
NextPower III MW on an equivalent look-through basis).

As at 30 June 2022, the Company had a unaudited gross asset value of
£1,198m, being the aggregate of the net asset value of the ordinary shares,
the fair value of the preference shares and the amount of NESF Group debt
outstanding, and an unaudited net asset value of £717.2m.

NESF's investment objective is to provide ordinary shareholders with
attractive risk-adjusted returns, principally in the form of regular
dividends, by investing in a diversified portfolio of solar energy and energy
storage infrastructure assets.  The majority of NESF's long-term cash flows
are inflation-linked via UK government subsidies.

For further information on NESF please visit www.nextenergysolarfund.com
(http://nextenergysolarfund.com/)

Commitment to ESG

NESF is committed to ESG principles and responsible investment which make a
meaningful contribution to reducing CO2 emissions through the generation of
clean solar power.  NESF will only select investments that meet the
requirements of NEC Group's Sustainable Investment Policy.  Based on this
policy, NESF benefits from NEC's rigorous ESG due diligence on each
investment.  NESF is committed to reporting on its ESG performance in
accordance with the UN Sustainable Development Goals framework and the EU
Sustainable Finance Disclosure Regulation.

NESF has been awarded the London Stock Exchange's Green Economy Mark and has
been designated a Guernsey Green Fund by the Guernsey Financial Services
Commission.

Article 9

NESF is classified under Article 9 of the EU Sustainable Finance Disclosure
Regulation and EU Taxonomy Regulation.

NESF's sustainability-related disclosures in the financial services sector in
accordance with Regulation (EU) 2019/2088 can be accessed on the ESG section
of both the NESF website (nextenergysolarfund.com/esg/
(http://www.nextenergysolarfund.com/esg/) ) & NEC Group website
(nextenergycapital.com/sustainability/transparency-and-reporting/
(https://www.nextenergycapital.com/sustainability/transparency-and-reporting/)
).

 

About Eelpower

Eelpower Limited ("Eelpower") is a well-established privately held
constructor-owner-operator in the new and rapidly growing electricity storage
market.   Eelpower's management team and investors previously built the
largest hydropower sites in England this century where they pioneered
behind-the-meter battery storage integrated with hydro generation and
industrial consumers.  Since its launch in 2017, Eelpower has delivered,
owned, and managed some of the highest-earning storage assets in the UK.

 

For further information on Eelpower please visit eelpower.co.uk.
(https://eelpower.co.uk/)

 

About NextEnergy Group

NESF is managed by NextEnergy Capital, part of the NextEnergy Group.
NextEnergy Group was founded in 2007 to become a leading market participant in
the international solar sector.  Since its inception, it has been active in
the development, construction, and ownership of solar assets across multiple
jurisdictions.  NextEnergy Group operates via its three business units:
NextEnergy Capital (Investment Management), WiseEnergy (Operating Asset
Management) and Starlight (Asset Development).

 

NextEnergy Capital

NextEnergy Capital comprises the Group's investment management activities.
To date, NEC has invested in over 350 individual solar plants for a capacity
in excess of 2.4GW across it institutional funds.
www.nextenergycapital.com (http://www.nextenergycapital.com/)

·   NextEnergy Solar Fund ("NESF") is a solar infrastructure investment
company focused on the UK and other OECD countries, which is listed on the
premium segment of the London Stock Exchange.  It currently owns 865MW spread
among 100 individual operating assets in the UK and Italy, comprising an
unaudited gross asset value of £1,198m.  NESF is one of the largest listed
solar energy investment companies in the world.

·     NextPower II ("NPII") a private fund made up of 105 individual
operating solar power plants and an installed capacity of 149MW, focused on
consolidating the substantial, highly fragmented Italian solar market.  NPII
was successfully divested in January 2022, a 2016 vintage vehicle that
generated net IRRs in excess of its gross target of 10-12%.

·   NextPower III ESG ("NPIII") is a private fund exclusively focused on
the international solar infrastructure sector, principally targeting projects
in carefully selected OECD countries, including the US, Portugal, Spain,
Chile, Poland and Italy.  NPIII is a fund that provides a positive social and
environmental impact to the countries it has and will invest into. NPIII
completed its fundraise with a total of $896m, including a SMA raised.  The
target of the fund was $750m.

·     NextPower UK ESG ("NPUK") is a private unlevered fund investing in
greenfield subsidy-free solar projects, with PPA's, in the UK.  NPUK was
launched in December 2021.  The UK Infrastructure Bank is providing financing
to the initial seed assets of the fund, and plans to invest up to £250m, half
of the fund's total target fund size, on a match-funding basis.

 

 

WiseEnergy

WiseEnergy® is NextEnergy Capital Group's operating asset manager.
WiseEnergy is a leading specialist operating asset manager in the solar
sector.  Since its founding, WiseEnergy has provided solar asset management,
monitoring and technical due diligence services to over 1,400 utility-scale
solar power plants with an installed capacity in excess of 1.8GW.  WiseEnergy
clients comprise leading banks and equity financiers in the energy and
infrastructure sector.

www.wise-energy.com (http://www.wise-energy.com/)

 

Starlight

Starlight is NextEnergy Group's development company that is active in the
development phase of solar projects.  It has developed over 100 utility-scale
projects internationally and continues to progress a large pipeline of c.5GW
of both green and brownfield project developments across global geographies.

 

Notes:

(1:) All financial data is unaudited at 30 June 2022, being the latest date in
respect of which NESF has published financial information

 

 

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