Israel-based Ellomay Capital has signed a framework agreement with European renewables developer concerning development of 250MW of photovoltaic capacity in Italy.
Under the agreement’s terms the unnamed developer will scout and develop photovoltaic greenfield projects with the aim of reaching a total capacity of 250MW over a three-year period.
The developer, according to Ellomay, has PV projects totalling 100MW in various advanced development stages and 70MW of this amount will enter “ready to build” status by the end of 2020.
The framework agreement provides that each project will be presented to Ellomay Capital, through its subsidiary Ellomay Luxemburg, when it is designated “ready to build”.
If Ellomay Luxemburg accepts the project, the developer is obligated to transfer to Ellomay Luxemburg 100% of the share capital of the entity that holds the rights to the project.
With respect to each project, subject to the conditions set out in the framework agreement, Ellomay Luxemburg will enter into engineering, procurement and construction (EPC) and operation and maintenance (O&M) contracts with the developer to construct and operate the projects.
When the first project under the framework agreement achieves the positive environmental impact assessment, the parties will negotiate the terms of a model lump-sum, turnkey EPC contract and O&M contract, which will be executed with the developer in connection with all projects acquired under the framework agreement.
Ellomay Luxemburg paid the Developer an advance payment, based on the target aggregate project capacity of 250MW, and pays an additional advance payment per project when the project submits its environmental impact assessment application.
Ellomay chief executive Ran Fridrich said: “The company is pleased to update on the execution of the framework agreement with a developer and contractor that Ellomay Luxemburg has worked with for many years.
“We recognise the potential in the developing Italian renewable energy sector, which is based on market prices and not on governmental subsidies. Ellomay Luxemburg has been operating in the Italian energy market for a substantial period and this experience will enable us to use all the benefits included in this business opportunity.”