The Renewables Infrastructure Group (TRIG) has exchanged contracts to acquire a further 11% equity interest in the 396MW Merkur offshore wind farm, located in the German North Sea.
Upon completion of the deal TRIG will hold a 36% equity interest in Merkur and the total stake in the project will represent approximately 6% of TRIG’s portfolio by value.
The stake is being acquired from funds managed by InfraRed.
The transaction process included an independent third-party valuation, which supports the transaction price, and approval by TRIG’s independent Board of Directors.
Merkur benefits from long-term protected cash flows through its Feed-in Tariff agreement.
The deal also increases TRIG’s investments in the attractive German renewables market to 11% of portfolio value.
Merkur comprises 66 GE Haliade-150 6MW offshore wind turbines, and GE Renewable Energy provides operations and maintenance (O&M) services under a 10-year contract.
The repair and retrofit works associated with the Merkur rear frame defect first reported in June 2021 are substantially complete and operating satisfactorily.
The compensation due under the availability warranty for the year ended 31 March 2022 has been agreed with the turbine and O&M provider, with no financial impact on the carrying value for the wind farm.
Richard Morse, Chairman of TRIG, said: “We are pleased to be further increasing TRIG’s stake in Merkur, a project we know well.
“Merkur is one of six offshore wind farms in the TRIG portfolio, and an asset which reinforces our position of investing in attractive renewable energy projects that contribute to energy security and decarbonisation efforts across Europe.”
TRIG has also acquired a 100% equity interest in Spennymoor, a UK battery storage development project which will have a total capacity of 100MW (200 megawatt hour) when completed, from RES.
Spennymoor is situated in County Durham, in close proximity to a high voltage substation connection, and is located to alleviate grid constraints and provide balancing services for the significant industrial cluster in the Humber region, one of six major industrial clusters in the UK.
The project is in the late-stage development phase and RES has secured planning permission, a grid connection offer and land lease options.
The project has secured a grid connection enabling commencement of operations in 2031, while work is underway to bring forward the grid connection date, if possible.
Construction works will be timed to commence approximately a year before the connection date when finalised. Once operational, Spennymoor is expected to represent 2% of TRIG’s portfolio by value.
Richard Crawford, Head of Energy Income Funds, InfraRed Capital Partners, said: “TRIG’s investment in Project Spennymoor deepens our position in the flexible capacity sector, which is going to become increasingly important as renewables penetration increases.
“Investments in battery storage projects such as these not only complement the renewable generation assets in the portfolio, but also leverage the strong expertise of InfraRed and RES.”