REG - NextEnergy Solar Fnd - Second International Co-Investment

NextEnergy Solar FundAnnouncement

09/05/2022 07:00

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RNS Number : 6874K  NextEnergy Solar Fund Limited  09 May 2022

LEI: 213800ZPHCBDDSQH5447

9 May 2022

 

NextEnergy Solar Fund Limited

 

("NESF" or the "Company")

 

 

Second International Co-Investment:

 210MW Solar Plant Under Construction in Portugal

 

NextEnergy Solar Fund, the specialist solar power renewable energy investment
company, is pleased to announce that it has signed its second international
co-investment with NextPower III ESG ("NPIII ESG") for an investment of
c.€22.5m, taking a 13% stake in a 210MW solar project currently under
construction in Santarém, Portugal ("Santarém").  Energisation of the
project is expected to take place in Q2 2023.

 

Once energised, Santarém is expected to benefit from a long-term power
purchase agreement ("PPA") for the sale of electricity which is currently
being negotiated with a robust creditworthy counterparty.

This co-investment is the second such transaction sourced alongside NESF's
investment in NPIII ESG made in June 2021.  NPIII ESG is a private USD $806
million ESG solar fund focused on utility scale solar assets in OECD markets,
which provides NESF the opportunity to efficiently access an established
portfolio of operational and in-construction international solar assets.
 Co-investments alongside NPIII ESG are undertaken by NESF on a no-fee, no
carry basis.

 

The co-investment will be funded using headroom available within the Company's
revolving credit facilities.

 

This co-investment further strengthens the Company's portfolio, providing
additional geographical and revenue diversification.  The Company continues
to pursue a strong pipeline of domestic and international solar opportunities
on a direct and co-investment basis, as well as standalone and co-located
battery assets in the UK.

 

Kevin Lyon, Chairman of NextEnergy Solar Fund commented:

"NESF's second co-investment transaction, Santarém, is another testament to
the growth progress the fund is making.  NESF now has solar investments
across the UK, Italy, Spain and Portugal, further adding to the
diversification of the portfolio whilst growing NESF's global asset base.
NESF continues to benefit from NextEnergy Capital's leading expertise and
experience in the international solar market, particularly against the current
backdrop of volatility and uncertainty.  The board looks forward to keeping
the market up to date on further co-investment opportunities and on progress
on our pipeline over the course of the year, and further on."

 

 

Michael Bonte-Friedheim, Group CEO of NextEnergy Group said:

"Santarém marks another successful co-investment for NESF, demonstrating the
benefits of being an investor in NextPower III ESG, with access to unique
co-investment opportunities that only private sector funds can offer.
Santarém broadens NESF's geographic reach into Portugal, a market where
NextEnergy Capital, NESF's investment advisor, already has extensive on the
ground experience.  Portugal has one of the highest irradiation factors in
Europe and is an attractive market for solar."

 

For further information:

 NextEnergy Capital Group                   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 Editors(1):

 

About NextEnergy Solar Fund

NESF is a specialist solar power 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
equity structures, and 10% in energy storage.

 

NESF currently has a diversified portfolio comprising of the following:

Solar PV:

·    99 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 subsidy-free UK solar project under construction (Whitecross 36MW)

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

·    A $50m commitment into NextPower III ESG (a private solar
infrastructure fund providing exposure to operating and in-development
international solar assets)

 

Energy Storage:

·   A 50MW standalone battery storage project in Fife, Scotland, currently
under construction (part of a 250MW joint venture 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 31 December 2021, the Company had a gross asset value of £1,094
million, 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 a net asset value of £615million.

 

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.

 

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 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 325 individual solar plants for a capacity
in excess of 2.3GW 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 99 individual assets in the UK and Italy, comprising a gross asset value
of £1,094m.  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 to its investors in excess of 25%, versus a gross target of
10-12%.

·    NextPower III ESG ("NPIII ESG") 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 ESG 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 ESG") is a private unlevered fund investing in
greenfield subsidy-free solar projects, with PPA's, in the UK.  NPUK ESG 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 1,300 utility-scale
solar power plants with an installed capacity in excess of 2.2GW.  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.2.5GW
of both green and brownfield project developments across global geographies.

 

Notes:

(1:) All financial data is unaudited as at 31 December 2021, being the latest
date in respect of which NESF has published financial information

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