Commerz Real, Hydro Rein to invest in 1-GWp Danish solar portfolio

German investment manager Commerz Real AG and Hydro Rein, part of aluminum producer Norsk Hydro ASA (OSE:NHY), have pledged to invest over EUR 600 million (USD 599.8m) in an over 1-GWp solar project portfolio in Denmark over the next three-five years.

The portfolio consists of utility-scale projects developed by Denmark-based GreenGo Energy Group A/S, the latter said on Tuesday. The arrangement will see a joint venture (JV) of Commerz Real and Hydro Rein acquire the projects and provide financing to develop the schemes and bring the capacity into operation.

Once commissioned, the entire solar farm portfolio will have a combined output that will cover around 4% of Denmark’s total annual power demand, or some 300,000 homes.

In line with the plan, the JV has already taken possession of the first two photovoltaic (PV) schemes with a combined capacity of 362 MWp. One of them envisages the construction of a 170-MWp plant on Denmark’s west coast, while the other one will create a 192-MWp solar park in the southern parts of the country. Building activities on the two projects are due to begin in 2024, with commissioning targeted in 2026.

The transaction, which is pending regulatory clearance, will be the first investment for Commerz Real in the Danish solar PV market. The real assets subsidiary of German lender Commerzbank intends to place both assets with professional and semi-professional investors.

“The Danish investment market for photovoltaics is still relatively young and is seeing a correspondingly dynamic development. This offers the potential for growth and diversification [..],” said Barkha Mehmedagic, Global head of Institutional Sales and Group Treasury at Commerz Real.

(EUR 1.0 = USD 0.999)

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