Ellomay Capital Ltd., a renewable energy and power generator and developer of renewable energy and power projects in Europe and Israel, says it has entered into a joint development agreement (JDA) for solar photovoltaic projects in Texas.
The JDA was executed with a project development company experienced in the development of energy projects, site acquisition, capital markets and commercial management. The JDA provides for the initial development, design, construction and finance of two solar PV projects with an aggregate projected DC capacity of 23 MW (the first projects). The first projects are in advanced stages of development with estimated capital costs of $25-$27 million.
The company’s share of the capital costs of the first projects is estimated at approximately $18-$20 million, and the balance is intended to be provided by tax equity sources. The sites for the first projects will be leased under long-term leases from special purpose companies controlled by the development team.
One of the first projects, with a DC capacity of approximately 13 MW, is expected to achieve ready-to-build status within six months. The JDA also provides for the development of three additional solar PV projects with an aggregate capacity of approximately 30 MW DC.
The projects to be developed under the JDA will be subject to the ERCOT distributed generation (DG) scheme for projects of up to 10 MW AC capacity. The applicable electricity market is the ERCOT North zone market (ERCOT is the electricity regulator of the state of Texas).
Under the DG Scheme, ERCOT allows owners of generation assets to sell electricity to qualified service entities at market rates under real-time or day-ahead prices at the local nodes of the projects and/or designated behind the meter clients under power purchase agreements.
“The execution of the JDA follows a very careful and in-depth analysis of the U.S. solar PV market by the company and fulfills Ellomay’s strategy to enter into the U.S. market in a careful and gradual manner,” says Ran Fridrich, CEO of Ellomay. “Ellomay identified potential partners for the joint development of solar PV projects in the state of Texas with particular focus on sites in the metro Dallas area, a densely populated area experiencing high economic growth and large potential for future growth in electricity demand.”