Primrose Solar has signed 15 year power purchase agreements (PPA) with EDF Energy for existing solar farms totalling 104 MW of capacity.
Under the deal EDF Energy provides an inflation-linked guaranteed minimum price for power over the full term of the contract. This price floor improves Primrose Solar’s ability to raise capital against the projects, as it increases the level of fixed revenues that lenders use to size debt, and improves project returns.
Giles Clark, CEO, Primrose Solar, said:
“We're very pleased to be working with EDF Energy as a provider of secure, long-term agreements for the sale of the power that we generate at our solar farms. Working with a high credit rated entity such as EDF Energy is particularly attractive to Primrose Solar.”
John Cockin, EDF Energy’s Director of Business Services, commented:
“We’re always keen to work with low-carbon generators. The risk that lenders attach to the volatile nature of wholesale power prices can limit a renewable developer’s ability to raise capital for expansion.”
"By guaranteeing some of Primrose Solar’s income with a floor price, we’re able to remove a significant portion of that risk for them. It also demonstrates EDF Energy’s commitment to supporting the growth of independent renewable energy generators.”
Advising for Primrose was Gus Wood of Wragge Lawrence Graham & Co LLP.
Primrose Solar owns and operates solar farms throughout the UK, working closely with local communities and acting as a responsible steward of the land where the parks are located. Primrose has 10 solar farms representing 184 MW of installed capacity, of which 156 MW are now operating with a further 28 MW under construction.
EDF Energy produces about one-fifth of the UK's electricity from its nuclear power stations, wind farms, coal and gas power stations and combined heat and power plants. The company supplies gas and electricity to 6 million business and residential customer accounts and is the biggest supplier of electricity by volume in Great Britain.