Longroad gets royalty investment for 250-MW solar farm in Texas

The Sun Streams 2 solar park in Arizona. Image by: Longroad Energy.

August 4 (Renewables Now) - An entity linked to Altius Renewable Royalties Corp (TSE:ARR) has provided a USD-35-million (EUR 29.6m) royalty investment to US renewables developer Longroad Energy Holdings LLC for its just commissioned 250-MW Prospero 2 solar park in Texas.

The company, which is a majority-owned subsidiary of Canada's Altius Minerals Corporation (TSE:ALS), said on Tuesday that the deal was structured using royalty rates that vary over time. The investment was made through Great Bay Renewables, a subsidiary that Altius Renewables controls jointly with funds managed by affiliates of Apollo Global Management.

Great Bay is expected to earn a return of 8%-12% on its investment over the initial life of the project. Royalty revenue will start accumulating in January 2022 and increase after the first five years of operation of the solar park.

Prospero 2, with a direct current (DC) capacity of 331 MW, was commissioned at the start of August. Installed on leased lands from the University of Texas in Andrews County, the photovoltaic (PV) park will operate under two 15-year power purchase agreements (PPAs) with kidney dialysis services provider DaVita Inc and medical device company Zimmer Biomet Holdings Inc. The output that is not contracted by the two firms will be sold into the ERCOT spot market.

Prospero 2 is located in proximity to Longroad and AIP's 379-MW DC Prospero 1 solar farm, which was brought online in 2020.

(USD 1.0 = EUR 0.844)

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Veselina Petrova is one of Renewables Now's most experienced green energy writers. For several years she has been keeping track of game-changing events both large and small projects and across the globe.

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