New Energy Solar and SunPower Corp. (NASDAQ: SPWR) on Dec. 11 announced that New Energy Solar has acquired a substantial majority interest in two large-scale solar projects, totallng over 134 MW that SunPower developed, designed and constructed in Kern County, California.
SunPower will retain an ownership interest in the projects, which each having a capacity of 67.4 MW, and provide ongoing operation and maintenance services.
Stanford University has a long-term agreement to purchase 100% of the power, as well as the renewable energy credits (RECs), generated from one of the projects, the Stanford Solar Generating Station. Turlock Irrigation District (TID) has a similar agreement to buy the power and RECs generated from the second project, the TID Solar Generating Station. Both Stanford University and TID will use the renewable power generated in Kern County to serve electricity demand approximately 300 miles away.
“We believe the quality of these projects, both in terms of SunPower’s leading technology and their highly creditworthy off-takers make them excellent additions to our portfolio,” New Energy Solar CEO Tom Kline said.
“Stanford University and TID are using an innovative model called off-site solar to meet their renewable energy goals and serve their constituencies with cost-competitive emission-free solar power,” said Nam Nguyen, SunPower senior vice president. “Off-site solar allows for land-constrained organizations to benefit from the economies of scale achieved with larger solar installations.”
At both sites, SunPower installed the SunPower Oasis Power Plant technology, a fully integrated, modular solar power block that is engineered to rapidly and cost-effectively deploy large solar projects while maximizing power generation and optimizing land use. Construction of both projects commenced in the middle of 2015. Both facilities are expected to achieve commercial operation this month.
New Energy Solar’s full investment will occur upon the satisfaction of certain conditions, including, connection to the electrical grid, satisfaction of certain testing criteria, and the projects’ commercial operation.
MVP Capital advised New Energy Solar on the transaction, with Foley & Lardner LLP acting as legal counsel for New Energy Solar.
These two projects are expected to generate a five-year average yield of approximately 6.5% per annum (before New Energy Solar’s impact of borrowing and tax). With the addition of the California projects, New Energy Solar will own a portfolio of over 200 MW (dc) of large scale solar farms underpinned by highly creditworthy off-takers and have a weighted average power purchase agreement term of 17 years.
New Energy Solar’s Tom Kline said: “Once our assets in North Carolina and California are fully operational, we estimate the portfolio will generate enough power to supply 52,000 homes and abate an estimated 244,000 tonnes of carbon dioxide annually when compared with a coal-fired alternative plant; the equivalent of taking more than 57,500 cars of the road.”
New Energy Solar was established in 2015 as a sustainable investment fund. New Energy Solar’s objective is to help investors generate positive social impacts and financial returns through investment in large-scale solar assets. Its initial focus will continue to be on acquiring and maintaining a diversified portfolio of solar energy assets in the US, Australia and select Asian markets, namely investing in large-scale, solar farms with contracted cash flows that generate emissions-free power. New Energy Solar is an unlisted stapled entity consisting of New Energy Solar Fund (ARSN 609 154 298) and New Energy Solar Limited (ACN 159 902 708).
SunPower provides a diverse group of customers with complete solar solutions and services. Residential customers, businesses, governments, schools and utilities around the globe rely on SunPower’s more than 30 years of proven experience. Headquartered in Silicon Valley, SunPower has dedicated, customer-focused employees in Africa, Asia, Australia, Europe, North and South America.