Atrato Onsite Energy to acquire 34MW operational rooftop solar portfolio
Atrato Onsite Energy plc, the investment company focusing on clean energy generation, has entered into a share purchase agreement to acquire 100% of a fully operational, 34MW solar portfolio consisting of 9,549 rooftop solar PV systems located across England and Wales for £77.3m.
Transaction
The transaction, which is expected to complete within six weeks, is being acquired from a fund managed by Federated Hermes Infrastructure, the global, sustainable investment specialist. The transaction includes £38.7m of fixed rate existing project finance debt at an attractive cost of 2% and amortising over the 12-year contract term.
Portfolio
The portfolio benefits from revenue streams pursuant to the government’s Feed in Tariff (“FIT”) scheme, which have a 12-year unexpired term with annual, uncapped, uplifts, linked to the retail price index (RPI) and payable directly to ROOF by the respective utility companies. The FIT scheme was introduced in 2010 by the UK government to promote the uptake of renewable and low-carbon electricity generation.
The contracts have minimal exposure to wholesale power prices – a key focus for ROOF which has a 4% portfolio sensitivity to power price movement; the lowest in the sector.[1]
The portfolio has an operations and maintenance agreement (O&M) which covers all maintenance and day to day issues on the assets until the expiry of the lease. The O&M provider is highly experienced and manages 70,000+ similar residential installations.
ESG
The portfolio is helping to decarbonise domestic electricity consumption and support the UK’s Net Zero transition. It has generated 291 GWh of renewable energy to date, avoiding c. 55,000 tonnes of CO2 emissions since installation It is expected that the portfolio will generate an additional c. 390GWh over the remaining life of the asset, equating to a further carbon emission saving of c. 75,000 tonnes, equivalent to planting 3 million new trees.
Solar installations on residential properties are likely to increase in demand following UK government legislation that means all newly rented properties must have an Energy Performance Certificate (EPC) of at least “C” by 2025[2].
ROOF Outlook
Project Sol will mark the fifth acquisition made by Atrato Onsite Energy in the year to date. These transactions collectively represent an additional 120MW of solar PV capacity and £149m of investment[3] to the existing portfolio. Other notable acquisitions recently completed by the fund are, London Road, a 28MW solar PV project in Wellingborough, Northamptonshire, and Skeeby Solar, a 55MW solar PV project in Richmond, North Yorkshire.
Gurpreet Gujral, Managing Director of Atrato said:
“We are delighted to have agreed to acquire this significant rooftop portfolio which will provide immediate, long-term, highly contracted cash flows with 100% uncapped RPI linkage and UK government backing, supplying rooftop generated clean energy to nearly 10,000 homes.
