Financial close for 200 MW Innergex solar project in USA

Innergex Renewable Energy Inc. has closed the construction financing, tax equity commitment, as well as a 7-year term loan facility for the 200 MW Hillcrest solar photovoltaic project located in Brown County, Ohio. In aggregate, the US$191.8 million financing was led by CIT’s Power and Energy group and includes MUFG and Mizuho, as well as Wells Fargo as the tax equity investor.The project was acquired in October 2018 from a joint venture between Open Road Renewables, LLC, and MAP Energy, LLC, the initial developers of the Hillcrest project.

Michel Letellier, President and Chief Executive Officer of Innergex said, “This agreement confirms Innergex's strong ability to raise significant funds even during the harshest economic environment seen in decades. We appreciate the support and trust demonstrated by our lenders and our tax equity partner throughout this process. The construction of Hillcrest began earlier this year and is progressing well. We have contingency plans and measures in place to address any problems that may arise due to the current pandemic, and unless a decree is issued to halt construction, Hillcrest should come online by the end of the year.”

The total construction costs are estimated at US$279.5 million and will be partly financed through a US$82.0 million construction term loan and a US$109.8 million tax equity bridge loan provided by a lender group composed of CIT Group, MUFG and Mizuho. Innergex will fund the remaining US$87.7 million equity commitment. At commercial operation, Wells Fargo’s Renewable Energy & Environmental Finance group will provide the tax equity investment used to repay the tax equity bridge loan.

The project should receive a federal Investment Tax Credit (ITC) sized to approximately 30% of the project’s eligible value. Hillcrest is expected to produce a gross estimated long-term average of 413.3 GWh and a US$10.7 million projected adjusted EBITDA on average for the first five years of operation.

A power purchase agreement was signed last November with an investment grade rated US corporation for Hillcrest’s electricity production, which will be effective when the facility reaches its commercial operation. Innergex is required not to disclose the terms and conditions of the agreement until the other party has made public the information.