Bluefield Solar acquires Good Energy solar and wind farms

Good Energy has sold its operational solar and wind portfolio to UK income fund Bluefield Solar. Bluefield previously acquired the Good Energy developed West Raynham solar farm in 2015 and the acquisition brings Bluefield’s portfolio to 673MWp.
Bluefield acquired the 47.5MWp portfolio for an initial equity consideration of £16.4 million rising to a total of up to £24.5 million, subject to a series of due diligence milestones being met within the next 4-6 weeks. The acquisition contains £39.1 million of long term portfolio debt provided by Gravis.
Good Energy said the transaction was at a premium to net book value. As of 30 June 2021, the portfolio was held on the balance sheet at a net book value of £17.7 million, with gross assets of £56.8 million and debt outstanding of £39.1 million. The portfolio recorded pre-tax profits of £0.2 million in the six months ended 30 June 2021.
The portfolio consists of six solar farms totalling 30.1 MWp and two wind farms totalling 17.4 MW. All except one wind farm are in South West England. The portfolio provides around 15% of Good Energy customers’ electricity and will continue to do so via existing power purchase agreements. Of the solar projects, five are accredited under the feed-in-tariff (‘FIT’) regime and one of the projects is accredited under the Renewable Obligation Certificate regime with a tariff of 1.4 ROCs. Both of the wind farms are accredited under the ROC regime, being 1 ROC and 0.9 ROCs respectively. In the period 2021 to 2034, the proportion of regulated revenues from this portfolio is projected to be approximately 65%. Bluefield Solar will receive the economic benefit of cashflows from 1 July 2021.

Good Energy said the “strategic disposal” left it substantially debt free with a strong cash position. Proceeds will be used to accelerate investments across transport and decentralised energy, including the current funding round being undertaken by its subsidiary Zap-Map.
It will also support Good Energy’s investment in a new platform for its decentralised energy service business, which will enable smart export for solar customers, and the ability to pay actual as opposed to deemed rates.
Nigel Pocklington, chief executive Good Energy, said, “”The sale of our generation portfolio at a premium to book value is a transformational moment for Good Energy and a fantastic deal for all of our stakeholders. We are using the capital from our past, to invest in our future. Last year, we outlined our clear strategic direction to capitalise on a rapidly growing market in decentralised, digitised clean energy and transport services, based on 100% ‘real’ renewable power.

“We are ideally positioned to benefit from this trend through our investment in Zap-Map, the UK’s leading EV app, and our growing stable of other energy products and services. We expect to make further investments across both transport and decentralised energy to deliver our strategic plan, which we believe has massive headroom for growth. Alongside these investments into mobility and energy services, this transaction reduces debt and further strengthens our balance sheet, which is particularly important given the current volatility in the energy market.”

John Rennocks, Chairman of Bluefield Solar, said: “We are delighted to have acquired this high-quality portfolio of operating assets from Good Energy. Not only does this acquisition mark our second purchase of operational wind assets within the space of six months, but it also adds a very attractive portfolio of solar assets with a high proportion of regulated revenues to the Company’s significant existing portfolio. ”

Further reading
Good Energy seeks more working capital, warns a 30% tariff increase may not be the last
Good Energy puts £56M generation portfolio up for sale in transition to services, faces £1M extra costs from other suppliers’ failures