L&G NTR Clean Power Fund completes financing of Spanish solar projects

Written by Dan McGrath

14/07/2023

The Legal & General (L&G) Clear Power (Europe) Fund has announced that it has completed the financing of three Spanish solar projects in partnership with NordLB.

NordLB is the sole debt provider and hedge fund counterparty, which has provided debt facilities of around €50m with a debt tenor of 18 years.

Earlier in the year, L&G Investment Management (LGIM), which manages the fund, and NTR announced that €390m in committed capital and co-investment opportunity had been raised in the first close of the Clean Power (Europe) Fund.

The portfolio, which comprises two sites in Castilla la Mancha and one in Andalucía, are all currently in construction, with the first already exporting power and is scheduled to achieve commercial operations in July.

Only fully operational, the portfolio will have a combined capacity of 116MW, producing enough clean energy to power 51,424 homes.

Power purchase agreements (PPAs) have been signed with three parties, including Nestle Spain and Nestle Portugal, Huhtamaki and Holaluz, which will use 70% of the power generated across the three sites over the next 10 years.

In a separate transaction, LGIM has also completed the acquisition of Ferme Eolienne Cruscades and Canet, a six-turbine onshore wind project near Narbonne, France.

With a capacity of 13.4MW, the project will provide clean energy over 5,500 households and is already under construction, with the fund having acquired the asset from Samfi Energy.

Chief investment officer at NTR, Anthony Doherty, said: “This is a substantial financing which we have successfully closed in a more challenging environment, proving that quality clean power projects and a strong sponsor can still attract favourable terms. We are delighted to continue our strong relationship with NordLB and to have them involved in this project, which is helping to accelerate the energy transition across Europe. Both announcements today are significant milestones for the fund as, together with LGIM, we work hard to deliver new renewable energy installations which play an important role in meeting vital climate goals.”

Global head of structured finance at NordLB, Heiko Ludwig, added: “The successful closing of Garcia Lorca underlines our ongoing commitment to the build out of renewable energy in Europe with the Spanish market currently being very active. We are very happy to support our decade long client NTR with our structuring expertise to find tailor-made solutions for projects to enable an efficient and attractive financing package. Globally, we expect a growing demand for project financing of renewable and infrastructure assets for the next years and as such strong relationships between project sponsors and banks will be key.”

Global head of real assets at LGIM, Bill Hughes, concluded: “Following our first close of the Fund in the Spring, we’re delighted to be able to announce continued positive momentum on capital deployment with these latest additions to the Clean Power (Europe) Fund portfolio. With their combination of strong income characteristics and sustainability credentials, we believe these assets represent a compelling opportunity for institutional investors looking to play their role in delivering the clean power transition.”

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