German asset manager CEE Group has merged the renewable energy assets of three existing portfolios into new €500m repowering fund.
The installed capacity of the portfolio is around 457MW and will reach up to 1.1GW in the course of repowering.
The new repowering fund CEE RF9 will repower at least 29 operational assets, enabled by €1bn of debt financing.
Locations of the assets (16 onshore wind and 23 solar parks) are spread across Germany, with a few assets in France.
On average, the assets are 13 years old and on average still enjoy seven years of state feed-in tariffs.
Repowering is to be completed between 2027 and 2030.
The feed-in tariffs for the plants will largely remain in place and parts of the existing infrastructure, such as grid connections, will continue to be used on site.
Replaced wind turbines and solar systems will be sold on the secondary market wherever possible and otherwise recycled as far as possible.
CEE Group is strategically focusing on the increasingly important topic of repowering and is launching a specialised Article 9 fund for this purpose.
A total of 39 solar and onshore wind assets from CEE’s three existing portfolios, RF1, RF2 and RF3, are being bundled in the new fund with the aim of using the proven attractive renewables sites for at least 20 more years to generate green energy and achieve adequate and reliable returns.
“With this project, we are marking the next milestone in our company’s development and are fully embracing the repowering megatrend.
“The installed capacity of renewable energy generation in Germany and Europe in the 2000s and 2010s is getting outdated – but it is proven to be one of the most productive and established generation sites.
“Premature repowering can also be very attractive here – as a win-win for the energy transition and for investors interested in long-term returns,” said Detlef Schreiber, CEO of CEE Group.
“Such continuation vehicles are highly complex and require enormous stamina and implementation expertise.
“The fact that the majority of current investors are committing to CEE Group again for another 20 years is a clear endorsement of our expertise and proof that real progress in the energy transition is indeed possible in this country with the right partners.”
The CEE Renewable Fund/RF product series has “clearly convinced” institutional investors since launch of the first investment vehicle in 2008.
The majority of the legacy investors (85%) have invested in the new repowering fund as a successor on a long-term basis.
The term of RF9 is 20 years, the target internal rate of return (IRR) is 10% (base case scenario).