SDCL Energy Efficiency Income Trust (SEEIT) has agreed to acquire a series of on-site solar and energy storage projects in the US in a deal worth around £110 million.
As part of the transaction the UK-listed company will also take on a 50% interest in New York-headquartered Onyx Renewables Partners from Blackstone, which will retain the other half of the firm.
The deal is expected to go through in the coming weeks and will be funded from SEEIT’s existing cash reserves and debt facilities.
The London-headquartered firm will acquire a 100% interest in four portfolios totalling over 175 megawatts (MW), which provide renewable energy generated on-site directly to the end-user.
It will also take on half of Onyx’s follow-on pipeline, which is projected to exceed 500MW over the next five years.
The four portfolios comprise over 200 operational, construction and development stage rooftop, carport and “private wire” ground mounted solar PV projects, located in 18 US states.
The operational projects are contracted under long-term power purchase agreements.
As it stands, around 27% of the portfolio is operational or near operational, with the remainder expected to come online over the next 12 to 18 months.
SEEIT will also have a right of right of first refusal for future commercial and industrial on-site solar and energy storage projects developed by Onyx.
Onyx’s existing project debt finance facilities, which are equivalent to c.£27 million at acquisition, will remain in place.
Jonathan Maxwell, chief executive of Sustainable Development Capital, said: “We are delighted to further diversify the SEEIT portfolio through the acquisition of these on-site solar and storage projects and to partner with Blackstone in one of the largest sustainable energy initiatives of its kind in the United States.
“The projects will make a meaningful impact to reduce the carbon footprint of commercial and industrial clients across the United States by providing cheaper, cleaner and more reliable energy directly at the point of use and is strongly aligned with SEEIT’s investment policy and objectives, as well as the global climate policy agenda.”