News Article

US Solar Fund To Acquire Up To 50% Of 200MWDC Mount Signal 2


US Solar Fund plc is pleased to announce it has executed binding agreements to acquire up to a 50% interest in a 200MWDC operating solar plant located in the Imperial Valley of Southern California, Mount Signal 2 (MS2, the Project), for a total price of between $44 million and $46 million (the Transaction).

The Transaction is structured in two tranches. Tranche One comprises an immediate acquisition of an initial 25% interest for a fixed price of $23m and is expected to be completed during the first quarter of 2021, subject to customary third-party consents. Tranche Two consists of an option for USF to acquire a further 25% interest for $22m subject to a performance-based adjustment mechanism which can adjust the price upwards or downwards by up to $1m. USF may exercise the Tranche Two option for up to 12 months from Tranche One completion, with Tranche Two completion subject to the same customary third party consents as Tranche One.

On completion of Tranche One of the Transaction, USF's total portfolio will be 493 MWDC of fully operational assets in five states of the US, with a weighted average investment-grade PPA term of 15.6 years[i].

USF will acquire the investment in MS2 from New Energy Solar Fund (NEW), an Australia listed (ASX) solar fund, also managed by USF's Investment Manager, New Energy Solar Manager. NEW acquired MS2 at construction-ready stage in 2018 and announced in late 2019 that it was contemplating a sale of up to a 50% interest in the Project.

MS2 was built during 2018 and 2019 by Swinerton Renewable Energy, a leading US constructor. The Project uses First Solar Series 6 modules, with operations and maintenance services provided by First Solar Energy Services under a long-term contract. MS2 has a 20-year PPA with Southern California Edison (SCE), that commenced in June 2020. Under the PPA, 100% of the electricity generated by MS2 is sold to SCE at an annually escalating price. SCE (S&P: BBB), a subsidiary of Edison International, serves a population of more than 15 million people and is the primary electricity provider for central, southern and coastal California.

Co-investments in solar power assets like MS2 were contemplated at the time of USF's listing and initial public offering. To ensure arm's length terms, the USF and NEW boards each adopted a Transaction-specific protocol, with each board retaining independent advisors. USF was advised by lawyers Herbert Smith Freehills in the UK, and Troutman Pepper in the US. USF also engaged its US valuer to provide an independent, external benchmark for the Transaction price.

USF will fund Tranche One with available cash. As Tranche Two is an option in USF's favour, the funding source for Tranche Two will be announced if and when USF decides to exercise the option.

Commenting on the transaction, Gill Nott, Chair of the Company said:

“The Board is pleased to add an initial 25% of this large utility-scale asset to USF's portfolio. MS2's long term, investment-grade, escalating-price PPA brings USF's weighted average remaining PPA term to almost 16 years and provides further diversification in terms of geography, project and PPA offtaker to the portfolio. As a result of the Transaction, 100% of USF's IPO proceeds have now been invested or committed to operational projects and we look forward to continuing to offer investors the opportunity to participate in the attractive US solar market”

[i] Based on initial 25% acquisition. If the option were to be exercised for the second 25%, the weighted average PPA term remaining would be 16 years.

AEG Power Solutions Equips The Microgrid Laboratory Emulator Of Paderborn University
Sonnedix Named ESG Global Solar Power Generation Sector Leader By GRESB
EnergyLink3 And C4V Lead Tesla In Race To Less Toxic Mobile Battery Solution
Oakapple Renewable Energy Appoint Stuart Gentry To Head Business Development
Going Green In Lancashire – Hundreds Of Houses Installed With Solar Panels In Ground-breaking Project
BayWa R.e. Sells Subsidy-free Solar Farm In Spain To Commerz Real’s Impact Fund Klimavest
SunBrush Mobil Delivers Its New Cleaning Device For PV Tracking Systems To Chile
Everoze Creates Skyray To Design And Engineer Great Solar PV Projects
What Role Can Solar Energy Play In Enabling A Better Future
New Energy Scout GmbH Becomes Part Of Basler & Hofmann AG
Azelio And JET ENERGY In MoU To Develop Storage Projects With Solar PV In Africa
US Solar Fund To Acquire Up To 50% Of 200MWDC Mount Signal 2
SUNfarming Reaches Financial Close On Project Financing For 26 MWp PV Portfolio In Poland
EnBW Chooses Delta Inverters For 2.62 MWp Solar Farm In Kenzingen
Array Technologies Announces A 1GW Purchase Agreement With RP Construction Services
Sonnedix Adds 40 MW Of Capacity To Its Portfolio In Chile
ENGIE And Kiwi Power Enter Netherlands’ Grid Flexibility Market
Analysis Of UK Commercial Roof Space Shows Solar PV Film Can Achieve Net Zero Without Greenfield Sites
UK'S Largest Battery Ready To Balance The Grid
Luxcara Acquires Largest Independent PV Project In Germany From BELECTRIC
Ingeteam Supplies Solar Inverters For PV Project Of More Than 100MW In Chile
Sonnedix Acquires 150MW Utility Scale Project Located In Central Chile
SUNfarming Secures EUR 10 Million In Fresh Money For Poland
Sunstore Solar Launches WattGrid, A New Range Of Turnkey Off-grid Power Systems

Search the news archive

To close this popup you can press escape or click the close icon.
Register - Step 1

You may choose to subscribe to the Solar + Power Magazine, the Solar + Power Newsletter, or both. You may also request additional information if required, before submitting your application.

Please subscribe me to:


You chose the industry type of "Other"

Please enter the industry that you work in:
Please enter the industry that you work in:
{taasPodcastNotification} Array