Etem Gestamp, a joint venture of Greek aluminium extrusion company Etem Group and Spain-based automotive components manufacturer Gestamp, signed a ten-year power purchase agreement (PPA) with Bulgarian renewable energy investor Private Equity Fund - Growth for 4 GWh of solar energy per year, deal advisor Elnova said on Wednesday.
Etem Gestamp will buy 100% of the electricity to be produced by a solar plant which is under construction and set to be commissioned in the autumn of 2022, Bulgarian electricity trader Elnova, which consulted on the structuring of the transaction, said in a press release.
"The purchase of electricity from this new solar plant is our next step towards more sustainable aluminium extrusion with facilities powered by renewable energy," Etem Gestamp CEO Emmanouil Fountoukis said.
This is the first transaction in Bulgaria between a producer and an industrial consumer of electricity, in which the latter will buy all of the green electricity produced by the solar plant, Elnova noted.
Etem Gestamp, which makes extruded aluminium profiles and components for the automotive industry, will purchase the electricity at a fixed price in return for the issuance of certification that the supplied energy is 100% green.
"The contract enables us to predict the project's cash flow for the next ten years, which is almost unattainable via other market instruments. This motivates us to continue investing in new renewable energy projects, because with this type of contract we get security, stability and conviction," Private Equity Fund - Growth executive director Dimitar Vartigov explained in the press release.
Set up in 2012, Private Equity Fund - Growth invests in startups with a focus on digital and green technologies as well as in renewable energy projects with capacity of up to 5 MW. The private equity fund is looking to expand its portfolio by further investing in carbon neutral assets.
In March, Etem Gestamp announced that it will invest over 120 million levs ($62.5 million/61.4 million euro) in the expansion of its car parts plant in Sofia.
(1 euro = 1.95583 levs)
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