Norway’s Scatec Solar ASA has signed on to a $157 million financing deal with Google and Prudential Capital Group to construct a 104 MW solar power plant in the U.S. state of Utah.
When complete, the Utah Red Hills Renewable Energy Park will be Scatec Solar’s largest project in North America.
Bankrolled by Google and Prudential, the project will boast a total investment of some $188 million. Google is providing tax equity and Prudential is putting up debt financing while Scatec Solar will provide sponsor equity.
Google and Scatec Solar will own the plant via a joint venture between the two companies, which structured and executed the financing for the project. Scatec Solar will manage and operate the plant.
Google’s appetite for tax-credit investment in PV shows few signs of abating. Google has signed agreements to fund more than $1.5 billion in renewable energy investments across three continents with a total planned capacity of more than 2.5 GW. The latest deal represents the Internet giants 18th renewable energy investment.
The companies expect the Red Hills solar park to generate around 210 million kilowatt hours of electricity a year, which will be fed into the grid under a 20-year power purchase agreement with PacifiCorp’s Rocky Mountain Power.
When operational by the end of 2015, the plant will be Utah’s largest solar energy generation facility, generating enough energy to power approximately 18,500 homes annually.
"This investment from industry leaders Google and Prudential Capital Group represents a major step forward in providing Rocky Mountain Power access to the superb solar power potential available in Southern Utah," said Luigi Resta, managing director of Scatec Solar North America.
The ground-mounted PV facility is being developed on approximately 650 acres of privately-owned land in Parowan, Utah, with approximately 325,000 PV modules on a single-axis tracking system and will interconnect to an existing transmission line.
The 30% ITC is set to be reduced on January 1, 2017. GTM Research believes that the change will result in the U.S. PV market installing 12 GW in 2016, as developers hustle to finish projects before the ITC changes.
"We expect 2017 to be the beginning of a big shift in the U.S. where the market will shift away from utility-scale solar and the residential market will be the biggest market segment," GTM Researchs solar analyst Corey Honeyman told pv magazine.
The January edition of pv magazine includes a feature article on the U.S. solar market after 2016.
Additional reporting by Christian Roselund.