Author: Elgar Middleton

Elgar Middleton are pleased to have advised Foresight Group LLP (“Foresight”) on the RCF financing for their ITS Fund.

The Foresight ITS Fund was established to provide a diversified real asset investment portfolio for retail investors. The Fund has been investing for over 10 years in mainly UK situated infrastructure assets, including renewable energy generation, telecommunications, forestry, social infrastructure, and biomethane refuelling.

The RCF provides additional capital for the expansion of the existing portfolio investments and will also provide Foresight greater liquidity during their acquisitions of new portfolio investments.

The facility was provided by Hamburg Commercial Bank AG.

Elgar Middleton was exclusive financial advisor to Foresight on this transaction.

Elgar Middleton are delighted to have advised Cero Generation (“Cero”) on the financing of their 49.5 MW (99MWh) Larks Green Battery Energy Storage System.

Cero was able to leverage the strengths that stem from co-located projects to obtain a robust financing solution.

Elgar Middleton advised Cero through the financing process to secure £26.3m of construction finance. The finance was provided by Rabobank, who also financed the Larks Green solar project.

The BESS project has enabled the establishment of long-term partnerships with both Canadian Solar as the lead on the engineering, procurement and construction (EPC) for the battery, and EDF as the battery performance optimiser. Together, the projects will form the UK’s first co-located solar and battery storage project to feed electricity directly into the transmission network.

This transaction marks the second BESS financing that Elgar Middleton has closed this month and demonstrates the firm’s capabilities in structuring robust financing solutions for newer technologies such as battery storage.

Elgar Middleton are pleased to have advised DIF Capital Partners (“DIF”) on the financing of their UK-based solar generation and battery storage portfolio.

The portfolio consists of seven ready-to build assets equating to a total capacity of 720MW of which 380MW is solar and the remaining 340MW is BESS. Elgar Middleton facilitated the senior debt financing of the first 540MW of the portfolio. The financing encompasses not only senior debt, but an equity bridge loan provided by the group of senior lenders (ABN Amro, ING, Rabobank, NAB, KFW and Lloyds) and an accordion facility to enable the build of the final 180MW of the portfolio.

The first two projects within the portfolio are under construction, with an expectation that all projects will be operational by 2025.

This co-located solar/ battery storage portfolio was acquired by DIF in November 2022, 10% is owned by ib vogt with the remaining 90% sitting within DIF Infrastructure VII fund.

Elgar Middleton is delighted to have advised TagEnergy on the financing of Stage One of the Golden Plains Wind Farm.

With all agreements now in place, building the A$2bn, 756MW Stage One development will begin early in 2023, with the project expected to start producing green energy in the first quarter of 2025. The engineering, procurement and construction work and turbine supply will be undertaken by Vestas and will feature 122 wind turbines.

Once both stages are complete, Golden Plains, which is 150 km west of Melbourne, will be Australia’s largest wind farm at 1,300 MW. It will supply sustainable energy for more than 750,000 homes and feature a 300MW battery storage facility that will add flexibility and stability to the grid.

Elgar Middleton was exclusive financial advisor to TagEnergy, the sole investor, and assisted in securing an innovative non-recourse financing package from a lending group comprising Commonwealth Bank of Australia, Westpac Banking Corporation, KfW IPEX-Bank, Mizuho Bank, Bank of China, EKF, Denmark’s export credit agency and the Clean Energy Finance Corporation, Australia’s government owned green bank.

Financial close was achieved without the need for power purchase agreements (PPAs) and reflects TagEnergy’s pioneering investment strategy as well as an increasing willingness among banks to adopt innovative approaches to funding renewable energy in the Australian market.

Elgar Middleton is excited about the future of the Golden Plains project and, in particular, its ability to assist in the decarbonisation of the Australian electricity grid for many years to come.

Elgar Middleton is delighted to have advised Hermes GPE LLP (“Federated Hermes”) on the holdco financing of its majority stake in the 144MW Fallago Rig Wind Farm (the “Project”)

Federated Hermes was able to leverage the Project’s robust contractual structure and high proportion of fixed revenues to obtain a competitive financing package. This included PPAs with EDF Energy plc and BT plc.

Elgar Middleton advised Federated Hermes throughout the financing process to secure c.£132 million of long-term non-recourse debt and ancillary facilities.

Elgar Middleton is delighted to have advised Boralex on the acquisition as buy-side financial advisor

Boralex acquires Infinergy’s interests in the United Kingdom. The transaction includes Infinergy’s portfolio of projects in development and its 50% interest in a joint venture formed with Boralex in 2017, as well as the integration of the Infinergy team into Boralex.

With this acquisition, Boralex now owns a portfolio of 338 MW of wind and solar power and energy storage projects in the UK, including 232 MW owned by the joint venture with Boralex and 106 MW owned directly by Infinergy.

Infinergy’s team of 9 employees will join Boralex, enabling the acceleration of project development, including projects currently being explored in the high-potential UK market. Boralex will gain from the expertise of a team that has been developing energy projects for 19 years and has successfully completed approximately 300 MW of projects in the UK.

The transaction will enable Boralex to benefit fully from the revenues and optimisation initiatives related to the future operation of projects under development and ready for construction, including the Limekiln project. A symbol of the early years of the Infinergy-Boralex joint venture, Limekiln Wind Farm is one of the more advanced projects in the agreement. In May 2022, this project received planning permission for 110 MW of capacity, enough to power more than 96,000 British households. It is scheduled to be built in 2023.

This acquisition provides Boralex the opportunity to strengthen its European presence in markets with a high potential for further development. Its strategic plan calls for doubling its installed capacity worldwide to 4.4 GW by 2025 and again, to double such capacity between 2025 and 2030.

Elgar Middleton is delighted to have advised Octopus Australia on the refinancing of a solar portfolio in the New South Wales

Octopus Australia’s operating solar farm, Darlington Point Solar Farm 333MWdc / 275MWac is located in New South Wales, Australia and is the largest operating solar farm in Australia.

Octopus Australia secured a tailored financing package of approximately A$200m from a syndicate of banks comprising Commonwealth Bank of Australia, Westpac, Deutsche Bank and Bank of China.

We are very excited for the next period for Darlington Point solar farm and the ability for this site along to bring clean energy to over 115,000 households in Australia.

Elgar Middleton is delighted to have advised Field on the financing of the construction of a battery storage portfolio located in the UK

Field has secured a £46m loan from Triple Point Energy Efficiency Infrastructure Company (“TEEC”). This loan will finance the construction of an initial portfolio of four battery storage projects located in England, Scotland, and Wales. The first project has started construction and is expected to become operational this year, with the remaining three projects expected to start operations over the course of 2023.

This long-term financing with a c.19 year tenor will be drawn down over the course of the current financial year. The financing also includes a tailored ESG margin ratchet, with a discount being applied for success against a number of ESG KPIs. In addition to this margin ratchet, the loan features other innovative terms and structuring including an accordion facility to fund the build-out of at least an additional 500MWh of battery storage assets.

Field’s ambition is to respond to the global net zero challenge by installing 1.3GW of battery storage assets by 2024. This ambition is aligned with the increasing need for flexibility assets that need to be installed to accommodate the development of carbon-free but intermittent energy generators.

The commitment made by the UK government for cleaner energy is targeting that 100% of the electricity generated in the UK by 2035 should come from low carbon sources. To reach this ambitious target, the rollout of renewable energy will not only have to keep a good pace, but it will have to accelerate. According to analysis from GlobalData [1], the UK’s renewable power capacity should reach more than 110GW in 2030 while in 2020 this capacity was around 47GW – it is a 134% increase in 10 years.

This significant development of renewable energy will trigger a need for more flexibility assets to manage the intermittency. According to Aurora [2] , the UK will need to have installed 46GW of energy storage by 2035, with c.22GW likely to be battery storage (with a duration between 0 and 4 hours). As of March 2022, the total installed capacity of energy storage in the UK was 1.7GW [3], meaning that, based on Aurora’s analysis, this capacity would need to be multiplied by more than 20 over the next 13 years.

Elgar Middleton continues to support Field on its innovative battery storage portfolio. This deal is another example of Elgar Middleton’s market-leading work advising in the battery storage sector, demonstrating its ability to structure and source innovative ways of financing this technology. The UK will need a significant increase in its battery storage capacity over the coming years and Elgar Middleton is uniquely placed to help shape its growth.

Footnotes

[1] https://www.nsenergybusiness.com/news/uk-renewable-energy-capacity-2030/
[2] https://auroraer.com/insight/long-duration-electricity-storage-in-gb-2/
[3] https://www.energy-storage.news/the-numbers-behind-the-record-breaking-rise-of-the-uk-battery-storage-market/#:~:text=The%20UK%20installed%20446%20MW,storage%20sites%20has%20also%20increased

 

Elgar Middleton is delighted to have advised X-Elio on the financing of the 200MW Bluegrass Solar Farm in Queensland, Australia

The project benefits from a portfolio of innovative offtake agreements and strong grid connections due to its location in South Queensland.

The A$170m tailored financing package, provided by a syndicate comprising of CEFC , ING and SMBC, was required to reflect the advanced project structure.

Elgar Middleton advised X-Elio throughout the financing process marking the first successful cooperation between X-Elio and Elgar Middleton in Australia.

Elgar Middleton is delighted to have advised Neoen on the financing of the 157MW Kaban Green Power Hub in Queensland, Australia

The project benefits from a 15 year capacity purchase agreement (CPA) with CleanCo Queensland and also involves the upgrade of a 320km transmission line between Cairns and Townsville that supports renewable energy in the region.

The financing package is provided by a syndicate comprising BNP Paribas, HSBC, MUFG, NAB and NORD/LB and includes a number of features which deliver material value for Neoen.

Elgar Middleton advised Neoen throughout the financing process which marks the fourth successful cooperation between Neoen and Elgar Middleton across Australia and Europe.