LONDON, UK: SDCL Energy Efficiency Income Trust (SEEIT) has completed the acquisition of an 80% equity interest in a high-efficiency and operational biomass cogeneration plant, Sociedade de Iniciativa e Aproveitamentos Florestais – Energia, S.A., in Mangualde, Portugal from Capwatt S.A, for approximately €22 million.
Furthermore, SEEIT has delivered an additional €15 million to SIAF to part pay down its existing project finance green bond facility.
SIAF generates heat and power from sustainably sourced biomass. It supplies critical onsite heat to an industrial facility manufacturing medium-density fibreboard (“MDF”) owned by Sonae Arauco PT (“SAPT”) on a take-or-pay basis and it generates electricity which benefits from the Portuguese Feed-in-Tariff to the grid. The Project is expected to benefit from at least a further 23 years of stable, inflation linked, contracted cashflows with no demand risk, providing good visibility of returns for SEEIT.
The acquisition has been funded from existing cash reserves. The remaining balance of SIAF’s project finance green bond facility will be equivalent to approximately €20 million.
In addition to the acquisition of the Project, SEEIT and Capwatt have signed a Heads of Terms to focus on the joint development and acquisition of energy efficiency projects across Iberia.