UK's Foresight Solar makes initial Spanish financial investment adhering to Shell deal

• UK solar investor Foresight Solar Fund has actually concurred a EUR20 million offer to get a 26.1 MW solar project in Spain, the firm's initial in the country and its first ever subsidy-free solar financial investment.

Insight Solar Fund, part of the Foresight Group, has actually acquired the under-development project for an overall financial investment of EUR20.2 million. Building and construction is due to begin at the end of this month and also operations are slated to start in Q3 2021.

While Foresight Group has actually been energetic in Spain's solar market for time, advancing a variety of projects, this deal represents the first acquisition in Spain from its front runner Foresight Solar Fund (FSF) financial investment car.

Totally unsubsidised, the project is backed via a lasting power acquisition arrangement (PPA) with Shell Energy Europe, the power utility subsidiary of oil and also gas major Royal Dutch Shell. Power generated by the project will be offered to Shell Energy Europe at a set rate till 2030.

Insight stated it had had the ability to tap into the "considerable" regional experience of its financial investment manager, Foresight Group, which has workplaces in Madrid as well as takes care of a portfolio of other renewables assets in Spain, in completing the deal.

"This acquisition is a landmark in the advancement of Foresight Solar's geographically varied profile, standing for the Fund's first acquisition in Continental Europe and also our very first investment in subsidy-free solar.

"With a lasting, fixed cost PPA in position and a high manufacturing profile, the procurement is a clear demo of our capacity to resource and deliver steady cash flows at appealing risk-adjusted returns as well as notes an essential step in Foresight Solar's international expansion approach," Alek Ohlsson, chairman at Foresight Solar, stated.

The acquisition takes FSF's complete solar portfolio to 895MW, most of which is located in the UK with a profile of under-development solar projects in Australia.

Insight teased that a deal in Spain was close within its H1 2020 results disclosure recently. In talking about the present financial investment landscape for solar, Foresight claimed that while utility-scale solar possessions continue to be appealing as well as sustainable investments, return compressions in its house market of the UK have actually offered "challenges in locating suitably appealing opportunities".

Competition in the UK market for second solar properties is high, with the majority of operational solar ranches in the country owned by long-lasting owners. Therefore, rates for those up for sale have raised, preventing some institutional funds from making purchases.

This has sent many seeking chances overseas and Foresight disclosed during its results disclosure that it had exclusivity over a pipe of projects in Spain, which it was seeking to obtain.

"If effective, the Board believes the procurement of the Fund's very first subsidy-free properties is a clear indication of the amazing development possibilities in the European solar market," the business claimed.