NextEnergy Solar Fund (NESF) is hailing the approval of two subsidy-free solar developments, which brings it up to its c.150MWp UK target.
The two sites are currently being prepared for construction, and were chosen partially due to their near term energisation, expected early next year.
NESF will invest approximately £45 million in Whitecross – a c.35.3MWp solar farm on 124 acres in Lincolnshire – and Hatherden – a c.50MWp solar farm on 198 acres in Hampshire.
Michael Bonte-Friedheim, CEO of NextEnergy Capital Group, said reaching its c.150MWp target through the approvals was “truly a milestone achievement for NESF, as we have shown the market that we have achieved what we set out to do".
“NESF has firmly demonstrated its leadership in the UK solar market and continues to achieve superior technical and operational performance. In parallel, NESF continues to focus on further growth opportunities in the UK and internationally.”
With the two projects bringing NESF’s subsidy-free portfolio to its target, the company is additionally announcing that it has agreed to divest 16 development projects from its subsidy-free pipeline. These will be sold to a subsidiary of NextPower Development for a consideration of c.£5.6 million, providing NESF with an attractive return on the capital invested into site development.
It follows the announcement in May 2020 that the company would sell two subsidy-free projects under develop to NextPower for £11.5 million. There is the potential for NESF to sell more subsidy-free projects from its pipeline to subsidiaries of NextPower, but all will be down to the Board’s discretion and there are no exclusivity arrangements in place.
Kevin Lyon, chairman of NESF, added that the divestment would reduce the company’s exposure to “any further development risk at this time".
“This allows NESF to increase its focus on investment opportunities both in and outside the UK in line with the expansion of NESF's investment policy approved by shareholders last year”.