Altius Renewable Royalties JV invests in 216 MW of Texas wind, solar

Great Bay Renewables (GBR) has completed a USD-52.5-million (EUR 45.3m) royalty investment in a Texas-based 216-MW operational wind and solar portfolio belonging to Northleaf Capital Partners, Canadian investor Altius Renewable Royalties (TSE:ARR) said on Thursday.

GBR is a joint venture between ARR and funds of Apollo Global Management Inc (NYSE:APO).

The portfolio encompasses the 151-MW Old Settler and 50-MW Cotton Plains wind farms and the 15-MW Phantom Solar farm, which have all been in operation since 2017. Cotton Plains and Phantom Solar sell their power under long-term contracts with the US Department of Defense, while Old Settler’s generation will be sold into the ERCOT market.

The royalty investment will provide GBR with USD 4 million-7 million per year over the initial 10 years, while optimising Northleaf’s project level cash flow profile, according to the announcement. The funding will be used to repay existing debt financing and for additional working capital.

In addition, ARR announced that one of its funded developer partners has sold a 500-MW renewable energy project in Texas to a confidential buyer, leading to the creation of a 2.5% royalty in favour of GBR. The project is expected to issue notice-to-proceed in early 2022.

ARR chief executive Brian Dalton said the company’s GBR joint venture subsidiary is poised to become cash flow positive in 2022, sooner than expected.

The business has now recently closed investments related to four operational assets. “This new funding avenue, combined with the continuing strong demand for the new projects being created by our developer partners, has resulted in the rapid growth of our royalty portfolio to now cover more than 3 GW of renewable energy projects,” Dalton added.

(USD 1 = EUR 0.864)

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