Ørsted announces $572 million partnership with Energy Capital Partners

LONDON: Ørsted has announced a $572 million divestment of a 50% equity stake in three U.S. onshore projects to Energy Capital Partners (ECP), a prominent energy transition-focused investor.

The projects, set to begin operations in 2024, include two solar farms in Texas, Mockingbird Solar (468 MW) and Sparta Solar (250 MW), and Eleven Mile Solar Center in Arizona, which combines 300 MW of solar power and a 300 MW/1,200 MWh battery storage system. All three projects have secured tax equity partnerships and power purchase agreements.

Ørsted retains a 50% ownership in the projects and will continue their operations. The financial impact of the transaction will be recorded in the Q4 2024 and Q1 2025 reporting periods, pending certain conditions.

In 2024, Ørsted secured approximately $734 million in upfront proceeds from tax equity partner J.P. Morgan and signed its first long-term tax credit transfer agreement for Mockingbird Solar Center. Combined, the divestment and tax equity funding bring the total proceeds for the three projects to $1.306 billion.

James Giamarino, Head of Commercial in Region Americas at Ørsted, highlighted the strategic importance of these transactions. “These transactions reflect our close engagement with a range of commercial partners, including our tax equity and transferability partners, which are all key to the growth of Ørsted’s U.S. onshore portfolio,” he said. “As we make further progress on our growth ambitions, we’ll use this recycled capital to continue the build-out of projects that create long-term value for our partners.”

The partnership with ECP builds on a previous collaboration where ECP acquired a 50% equity stake in three wind farms and one solar farm in 2022. Cody Castaneda, Head of Partnerships & M&A Americas at Ørsted, expressed enthusiasm about the ongoing collaboration. “Ørsted is excited to bring on ECP as a partner in these additional assets. Our continued partnership reflects the valuable benefits that our diverse portfolio provides for investors, and we’re grateful to ECP for sharing our commitment to supporting the expansion of renewables and American energy generation.”

ECP’s Matt Himler praised the projects, stating, “These projects are prime examples of the kind of large-scale clean energy infrastructure the U.S. needs to meet the growing demand for electricity. We’re pleased to expand our partnership with Ørsted and to invest in their diversified portfolio of contracted solar and battery storage assets in high load growth markets.”

With these new additions, Ørsted’s U.S. portfolio now includes over 6 GW of onshore wind, solar, and battery storage projects in operation or under construction.

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