Global renewable energy development company SunEdison has announced a joint venture (JV) with Dominion for the 265MW Three Cedars solar project in Utah.
Similar to the 420MW Four Brothers project in Utah, which also received an investment from Dominion, the Three Cedars installation is signed under long-term power purchase agreements for 20 years with PacifiCorp (A-/A3), a subsidiary of Berkshire Hathaway Energy.
The Three Cedars site is currently under construction and fully financed with an expected completion date slated for mid-2016.
As part of the JV, Dominion will invest around US$320 million to acquire 50% of the cash equity and 99% of the tax equity for Three Cedars, including funding of construction. SunEdison is expected to finance the US$80 million balance of the capital for Three Cedars through a loan from Deutsche Bank.
Paul Gaynor, executive vice president of SunEdison EMEA & Americas, said: “We are excited to expand our partnership with Dominion to a total of 685 megawatts of solar in Utah. Our joint ventures with Dominion demonstrate the market appetite for SunEdison's high-quality, long-term contracted assets. SunEdison power plants put hundreds of people to work, create real and lasting benefits for local residents, and deliver clean energy to Utah homes at a competitive price.”
Developed by SunEdison, the project is expected to produce enough energy to power over 36,000 homes. Construction on the site is expected to create an estimated 250 jobs within the area of Iron County, Utah, and yield US$17 million in direct property and income taxes over the next 20 years.
Looking to secure more financial security for its portfolio of PV projects, SunEdison also agreed to a partnership with J.P. Morgan Asset Management in order to fund renewable energy sites in both operating and construction stages.
The partnership is expected to fund the purchase of a 33% interest, valued at US$300 million, in a 425MW portfolio of solar assets owned by Dominion.
Gaynor added: “This partnership supports SunEdison's growth strategy while strengthening our liquidity. Attracting strong investors such as J.P. Morgan Asset Management reinforces the breadth and depth of demand for ownership of renewable energy assets.
“We are pleased to leverage this new partnership to invest in Dominion's diverse, domestic portfolio of solar assets without using any equity from SunEdison. This is our third transaction announced with Dominion in the last month.”