REG - Renew Infra Grp Ld - Acquisition in offshore wind and battery storage

Renewables InfrastructureAnnouncement

20/12/2022 07:00

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RNS Number : 2399K  Renewables Infrastructure Grp (The)  20 December 2022

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20 December 2022

The Renewables Infrastructure Group Limited

"TRIG" or "the Company", a London-listed investment company advised by
InfraRed Capital Partners ("InfraRed") as Investment Manager and Renewable
Energy Systems ("RES") as Operations Manager

Investment in Merkur offshore wind farm and in a battery storage development

Merkur incremental stake

The Company has exchanged contracts to acquire a further 11% equity interest
in the Merkur offshore wind farm (the "Project"), which is located in the
German North Sea. This incremental investment is approximately 2% of TRIG's
portfolio value. Upon completion TRIG will hold a 36% equity interest in
Merkur and the total stake in the Project will represent approximately 6% of
TRIG's portfolio by value.

The stake is being acquired from funds managed by InfraRed. Accordingly, the
transaction process included an independent third-party valuation, which
supports the transaction price, and approval by TRIG's independent Board of
Directors.

The Project benefits from long-term protected cash flows through its Feed-in
Tariff agreement. It also increases the Company's investments in the
attractive German renewables market to 11% of portfolio value. The Project is
well aligned with TRIG's portfolio construction approach of balancing
subsidised and unsubsidised revenues and achieving a broad geographical spread
across its selected European countries.

The Project comprises 66 GE Haliade-150 6MW offshore wind turbines, and GE
Renewable Energy provides Operations & Maintenance ("O&M") services
under a 10-year contract. The repair and retrofit works associated with the
Merkur rear frame defect first reported in June 2021 are substantially
complete and operating satisfactorily. The compensation due under the
availability warranty for the year ended 31 March 2022 has been agreed with
the turbine and O&M provider, with no financial impact on the carrying
value for the Project.

Battery storage investment

TRIG has also acquired a 100% equity interest in Project Spennymoor, a battery
storage development project which will have a total capacity of 100MW / 200MWh
when completed, from RES.

Project Spennymoor is situated in County Durham, in close proximity to a high
voltage substation connection, and is ideally located to alleviate grid
constraints and provide balancing services for the significant industrial
cluster in the Humber region, one of six major industrial clusters in the UK.

Project Spennymoor is in the late-stage development phase. RES has secured
planning permission, a grid connection offer and land lease options. The
project has secured a grid connection enabling commencement of operations in
2031. Work is underway to bring forward the grid connection date if possible.
Construction works will be timed to commence approximately a year before the
connection date when finalised. Once operational, Project Spennymoor is
expected to represent 2% of TRIG's portfolio by value. The initial development
investment is approximately 10% of the total anticipated investment.

Richard Morse, Chairman of TRIG, said:

"We are pleased to be further increasing TRIG's stake in Merkur, a project we
know well. Merkur is one of six offshore wind farms in the TRIG portfolio, and
an asset which reinforces our position of investing in attractive renewable
energy projects that contribute to energy security and decarbonisation efforts
across Europe."

Richard Crawford, Head of Energy Income Funds, InfraRed Capital Partners,
said:

"TRIG's investment in Project Spennymoor deepens our position in the flexible
capacity sector, which is going to become increasingly important as renewables
penetration increases. Investments in battery storage projects such as these
not only complement the renewable generation assets in the portfolio, but also
leverage the strong expertise of InfraRed and RES."

Enquiries

InfraRed Capital Partners Limited
+44 (0) 20 7484 1800

Richard Crawford

Phil George

Minesh Shah

Mohammed Zaheer

 

Maitland/AMO                                                       +44
(0) 20 7379 5151

Rhys Jones

Charles Withey

 

Investec Bank Plc
                                               +44
(0) 20 7597 4000

Lucy Lewis

Tom Skinner

Denis Flanagan

 

BNP Paribas
                                                       +44
(0) 20 7595 9444

Virginia Khoo

Carwyn Evans

The Company

The Renewables Infrastructure Group ("TRIG" or the "Company") is a leading
London-listed renewable energy infrastructure investment company. The Company
seeks to provide shareholders with an attractive long-term, income-based
return with a positive correlation to inflation by focusing on strong cash
generation across a diversified portfolio of predominantly operating projects.

TRIG is invested in a portfolio of wind, solar and battery storage projects
across six countries in Europe with aggregate net generating capacity of over
2.4GW; enough renewable power for 1.7 million homes and to avoid over 2
million tonnes of carbon emissions per annum. TRIG is seeking further suitable
investment opportunities which fit its stated Investment Policy.

 

Further details can be found on TRIG's website at www.trig-ltd.com
(http://www.trig-ltd.com) .

 

Investment Manager

 

InfraRed Capital Partners is an international infrastructure investment
manager, with more than 180 professionals operating worldwide from offices in
London, New York, Sydney and Seoul. Over the past 25 years, InfraRed has
established itself as a highly successful developer and custodian of
infrastructure assets that play a vital role in supporting communities.
InfraRed manages US$14bn+ of equity capital(1) for investors across the globe,
across listed and private funds in both income and capital gain strategies.

 

A long-term sustainability-led mindset is integral to how InfraRed operates as
it aims to achieve lasting, positive impacts and deliver on its vision of
Creating Better Futures. InfraRed has been a signatory of the Principles of
Responsible Investment since 2011 and has achieved the highest possible PRI
rating(2) for its infrastructure business for seven consecutive assessments,
having secured a 5 stars rating for the 2021 period. It is also a member of
the Net Zero Asset Manager's Initiative, a certified CarbonNeutral®
company(3), and is a TCFD supporter.

 

InfraRed is part of SLC Management, the institutional alternatives and
traditional asset management business of Sun Life. InfraRed represents the
infrastructure equity arm of SLC Management, which also incorporates
BentallGreenOak, a global real estate investment management adviser, and
Crescent Capital, a global alternative credit investment asset manager.

 

www.ircp.com (http://www.ircp.com/)

 

(1) Data as at Q2 2022. Equity Capital is calculated using a 5-year average FX
rate.

 

(2) Principles for Responsible Investment ("PRI") ratings are based on
following a set of Principles, including incorporating ESG issues into
investment analysis, decision-making processes and ownership policies. More
information is available at https://www.unpri.org/about-the-pri
(https://www.unpri.org/about-the-pri)

 

(3) In accordance with The CarbonNeutral Protocol. Further information is
available at https://carbonneutral.com/the-carbonneutral-protocol
(https://carbonneutral.com/the-carbonneutral-protocol)

Operations Manager

 

TRIG's Operations Manager is RES ("Renewable Energy Systems"), the world's
largest independent renewable energy company.

 

RES has been at the forefront of wind energy development for over 40 years,
with the expertise to develop, engineer, construct, finance and operate
projects around the globe. RES has developed or constructed onshore and
offshore wind, solar, energy storage and transmission projects totalling more
than 22GW in capacity. RES supports over 9.5GW of operational assets worldwide
for a large client base. Headquartered in Hertfordshire, UK, RES is active in
11 countries and has over 3,000 employees engaged in renewables globally.

 

RES is an expert at optimising energy yields, with a strong focus on safety
and sustainability. Further details can be found on the website
at www.res-group.com (http://www.res-group.com/) .

 

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