Portugal: Aquila Capital acquires 170MW solar projects, HSH Nordbank enters market

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Hamburg-based investment firm, Aquila Capital has acquired four ready-to-build solar projects located in central and southern Portugal with a capacity of over 170 MW.

Not revealing the name of the developer or value of the transaction, Aquila Capital stated that construction of the projects is scheduled for completion by the end of 2018.

The company also said it had entered into a power purchase agreement (PPA) for the solar parks with a local third party.

“Even without state funding support, these projects are a highly attractive investment. With the help of a long-term power purchase agreement, we have been able to secure stable attractive income for our investors,“ said Susanne Wermter, Head of Investment Management Energy & Infrastructure EMEA, Aquila Capital.

Attractive

Meanwhile, HSH Nordbank announced it would provide the independent French power producer, Neoen with long-term loans amounting to roughly €30 million (US$35 million) to refinance two solar plants in Portugal.

The total amount of refinancing stands at €60 million ($70 million), involving two other banks in a club deal. According to Neoen’s financial advisor Astris Finance, the projects are financed through two separate bond facilities led by HSH Nordbank and Banco Comercial Português, acting as co-Mandated Lead Arrangers, with La Banque Postale also involved in the financing.

As stated by the Hamburg-based commercial bank, it is the first time HSH Nordbank is providing financing in the form of secured bonds, which are issued under the terms of project financing and in line with financing standards for such projects in Portugal.

“This refinancing is very appealing to us for several reasons,” Lars Quandel, Head of Energy & Infrastructure at HSH Nordbank, said. “We gained Neoen as a new client and created a new product in our Bank with this transaction that is exceptionally well suited for follow-on business.”

The two ground-mounted solar PV plants in question are 13.2 MW Cabrela and 8.8 MW Seixal located near Lisbon, which were won by Neoen, Tesla’s partner on the world’s largest 100 MW (129 MWh) lithium-ion battery in South Australia, as part of the 2010 renewable energy tender and started commercial operation in 2014. A 20-year PPA has been inked for both projects with Energias de Portugal.

Green light

As the country awaits a new regulatory framework for the development of large-scale solar projects, briefly mentioned in the draft state budget law for 2018, the Portuguese authorities have recently approved several utility-scale projects.

According to the local financial newspaper Expresso, the Portuguese government has so far given a green light to 14 large-scale PV projects with a combined capacity of 521 MW.

In a recent interview with pv magazine, António Sá da Costa, president of the Portuguese renewable energy association Apren, urged for the introduction of auctions, and 15-year PPAs for large scale solar, as a required push for the country’s underdeveloped solar PV sector. 

According to the latest available data of the Directorate General for Energy and Geology (DGEG), Portugal reached 474 MW of cumulative registered PV capacity at the end of July 2017. However, not all of this capacity is currently installed or connected to the grid.