Georgia Power, a unit of Southern Co. (NYSE: SO), has worked out a deal with Simon Solar Farm LLC for the eventual sale-leaseback of a planned 30-MW solar farm.
In December 2011, Georgia Power and Simon Solar Farm executed a Large Scale Solar Power Purchase Agreement. Under the terms of that PPA, beginning on June 1, 2015, Simon Solar agreed to supply Georgia Power with 30 MW of solar energy from the Simon Solar Farm Facility. The Georgia Public Service Commission approved the PPA in January 2012.
On March 4, 2013, Simon Solar requested that Georgia Power provide its consent to its proposed financing transactions, pursuant to the PPA, in order to effectuate construction and permanent financing of the project.
The necessary consents Simon Solar requests from Georgia Power include the following:
- (1) the collateral assignment of the PPA to Macquarie Bank Ltd. for construction financing purposes;
- (2) upon completion of construction of the project and concurrent with payment in full to Macquarie of the construction loan, a transaction where Simon Solar will sell the facility to its permanent lender, the Bank of America (BOA), acting through a BOA affiliate, BA Leasing BSC LLC, and thereafter BA Leasing will lease-back the facility to Simon Solar;
- (3) the collateral assignment of the PPA to BA Leasing for permanent financing purposes; and
- (4) Simon Solar’s assignment of the operational responsibility of the facility to Phoenix Solar Operations.
Georgia Power said in a June 18 filing at the PSC that it has executed a consent with respect to the PPA with Macquarie which grants those approvals. The Macquarie consent contains a “regulatory out” provision and the effectiveness of the consent is wholly conditioned upon approval by the commission. If the commission does not issue an acceptable order approving Georgia Power’s execution of the Macquarie consent, the consent will be null and void.
The 30-MW Simon Solar Farm Project will be located in Walton County, Ga., at a community called Social Circle, about 50 miles east of Atlanta.
The Simon Solar website said the project was developed by local businessman Steve Ivey. “On September 13, 2011, Ivey entered the bid process presented by the Ga Public Service Commission and GA Power which was an open call email bid based on first in line process,” the website said. “After winning the opening slot, he began the process of completing the power purchase agreement which was agreed to on December 19, 2011 (the same date his grandfather bought the land in 1935).”
“This particular region of the U.S. ranks high in solar energy potential and very low in solar energy development, so Georgia is a prime location for this booming industry both on large scale solar like Simon Solar and all the way down to small scale home implementation,” Ivey said, as quoted on the website.