Chicago and Tempe, Ariz., October 3, 2011 — Exelon Corp. announced its acquisition of Antelope Valley Solar Ranch One, a 230-MW solar photovoltaic project under development in northern Los Angeles County, Calif., from First Solar, which developed and will build, operate and maintain the project.
Construction has started, with the first portion of the site expected to come online in late 2012 and full operation planned for late 2013.
When fully operational, AV Solar Ranch One will use about 3.8 million solar panels. The project has a 25-year power purchase agreement, approved by the California Public Utilities Commission, with Pacific Gas & Electric for the full output of the plant.
Exelon expects the total investment of up to $1.36 billion to be accretive to earnings beginning in 2013 and free cash flow accretive starting in 2013. The project is value accretive, and will have stable earnings and cash flow profiles due to the PPA. Exelon expects to invest up to $713 million in equity in the project through 2013.
The U.S. Department of Energy's Loan Programs Office finalized a loan guarantee of up to $646 million to support project financing for AV Solar Ranch One. Advances under the loan are contingent on the satisfaction of various conditions. No regulatory approvals are needed for Exelon's acquisition of AV Solar Ranch One from First Solar.
In connection with the sale of AV Solar Ranch One, First Solar is filing a Current Report on Form 8-K with the Securities and Exchange Commission. First Solar investors should refer to such Form 8-K, as it contains important additional information, including information related to revenue recognition for the project.
The project will deliver economic benefits to the local community and the state of California, including the generation of state and local tax revenues and creation of up to a peak of 400 construction jobs and up to 15 ongoing operations and maintenance positions, with an emphasis on hiring workers from the local area.
The project will be built on 2,100 acres of fallow farmland near Lancaster, Calif., in the Antelope Valley area of the Western Mojave Desert, approximately 80 miles north of Los Angeles. The transaction expands Exelon's geographic presence into California, an attractive solar market with an ambitious renewable energy policy and some of the best PV resources in the world.