SDCL to invest in 125 MW Spanish CHP and biomass portfolio

SDCL Energy Efficiency Income Trust (SEEIT) plc is to acquire a portfolio of cogeneration assets in Spain for a total cash consideration of approximately EUR64 million (US$70.5 million).

The substantial majority of the portfolio’s revenues are investment grade, with nine operational projects providing in aggregate 125 MW of clean and efficient energy generation. The portfolio comprises five combined heat and power (CHP) plants, two olive processing plants and two biomass plants. 

The portfolio benefits from long-term contracted revenues, which mitigate exposure to any fluctuations in commodity prices. As a result, revenue and costs are relatively stable and predictable over the medium to long term.

Operations and maintenance on the portfolio will continue to be carried out by the vendor, a major industrial group, and benefit from long-term service agreements with the equipment providers Gestamp Biomass, GE, Rolls Royce, Jenbacher, Mitsubishi and Turbomach.

SDCL intends to keep in place existing project debt finance facilities associated with the portfolio which are in compliance with its borrowing limits.

Completion of the acquisition is expected in the coming weeks, subject to the satisfaction of certain customary conditions and consents. Upon completion, SEEIT will control the portfolio of assets through full or majority ownership of the underlying portfolio projects.