Banco Santander to sell part of its stake in Crescent Dunes to two Canadian pension funds

As stated by the Wall Street Journal, Banco Santander is seeking regulatory approval to sell part of its stake in the Crescent Dunes CSP project to two Canadian pension funds, according to a filing with the Federal Energy Regulatory Commission.

The project has 110 MWe of capacity and is under construction near Tonopah, about 190 miles northwest of Las Vegas. It is being developed by Tonopah Solar Energy LLC., a consortium formed by SolarReserve, Cobra and Santander.

The report indicates that “the plan calls for the Spanish bank to transfer its 26.8% stake in the consortium to a new joint venture which would hold its energy assets in the U.S.”

The filing says two Canadian pension funds, Ontario Teachers' Pension Plan and Public Sector Pension Investment Board, would each acquire a stake in the venture. Financial terms were not disclosed, but Santander and the funds would each own about a third of the joint venture, according to the filing.

The WSJ says that “the pension funds' interest comes as they and their peers increasingly target electric utilities, toll roads and other infrastructure assets for investment, drawn by the steady income the assets generate, which matches up well with their long-term liabilities”.

Furthermore, “in joining with Santander, the two Canadian pension funds would gain exposure to the $1 billion Crescent Dunes solar-energy project in Nye County, Nevada, while Santander would reduce its financial risk by taking on its new partners,” the New York-based newspaper says.

Crescent Dunes is expected to start generating electricity in February 2015 and produce enough solar energy to power 75,000 homes annually during peak electricity periods, according to SolarReserve's website. The energy will be sold to NV Energy under a long-term purchase contract.

The joint venture company would also hold Santander's renewable solar and wind power assets in California and Nebraska, according to the FERC filing.

E.ON splits in two companies and shifts away from fossil fuels

According to a Bloomberg report, Germany’s largest utility, E.ON, will split up and form a separate company to group its fossil fuel power assets, to focus on renewable energy.

“The energy shift has forced E.ON and its peers to close nuclear reactors and undermined power prices, decimating the profitability of traditional utilities”, indicates the report.

E.ON also announced it will write down the value of assets by €4.5 billion (US $5.6 billion), leading to a substantial full-year loss.

E.ON’s move is a “spin-off of its ‘Bad Bank’ assets” that “could set a blue print for other utilities”, including German rival RWE AG (RWE), analysts at Sanford C. Bernstein & Co. led by Deepa Venkateswaran said in a written statement to Bloomberg. “It will create more strategic clarity for E.ON’s shareholders and will help unlock more value for the stable downstream businesses.”

E.ON plans to create a new publicly listed company in 2016 specializing in power generation, global energy trading, exploration and production. That will leave the company to concentrate on renewable generation, distribution and marketing to households and consumers.

E.ON sells its business in Spain and Portugal to Macquaire Group Ltd.

The deal was worth €2.5 billion, according to a press release issued by the company.

The written statement indicates that “the buyer will take over all of E.ON’s activities in Spain and Portugal and is committed to the long-term future of the businesses.”

They include a portfolio of “650,000 electricity and gas customers; 32,000 kilometres of electricity distribution network and a total generation capacity of 4 GW that come from coal, gas, and renewable sources in Spain and Portugal.” The company employs approximately 1,200 people.

The transaction is subject to the approval of the European Competition Authority and it is expected to close in the first quarter of 2015. In addition, Wren House Infrastructure, an investment fund owned by the Kuwait Investment Authority, will then become a minority investor in E.ON’s Iberian businesses alongside the Macquarie Fund.

According to Bloomberg, E.ON is also exploring the disposal of assets in Italy and has put its exploration and production operations in the North Sea under “strategic review”.

AI-EES announces CAD $2 million funding program for renewable energy storage technologies

Alberta Innovates Energy and Environment Solutions (AI-EES) announced they are making CAD $2 million (approximately USD $1,75 million) in funding available to help develop energy storage technologies for Alberta.

The research institute is “looking for technology providers, from Alberta and beyond, that have ideas for energy storage to enable and accelerate the deployment of wind and solar power in Alberta”.

AI-EES has stipulated a 2030 target whereby 20% of the province’s electrical generation will come from renewable sources. Furthermore, it also states that the energy storage capacity will be equivalent to 2.5% of total electrical generation.

“The province of Alberta has strong wind and solar energy potential, but electricity needs to be available when the light switches go on, not just when the wind is blowing and the sun is shining. Energy storage technologies will assist in making widespread use of those resources,” says Mark Summers, Director of Renewable Energy for AI-EES.

Applications are due on 29 January 2015. The Corporation will fund up to CAD $250,000 per approved project with up to CAD $2 million of funds committed. Proposals will be accepted from around the globe. However, applicants must demonstrate that the technology is applicable and well-suited for Alberta.

For more information visit: www.ai-ees.ca/opportunities