SunEdison, Inc. (SUNE), the largest global renewable energy development company, and Dominion (NYSE:D), one of the nation's largest producers and transporters of energy, today announced a joint venture (JV) for the Three Cedars solar project, a 265 megawatt (MW) DC, or 210 MW AC, solar project in Utah, developed by SunEdison. The announcement marks the expansion of a joint venture recently announced regarding Dominion's investment in the 420 MW DC Four Brothers solar project in Utah.
Similar to Four Brothers, the Three Cedars project is contracted under long-term power purchase agreements for 20 years with PacifiCorp (A-/A3), a subsidiary of Berkshire Hathaway Energy. The project is now under construction and fully financed with an expected commercial operation date of mid-2016.
Under the terms of the expanded JV, Dominion will invest approximately $320 million to acquire 50 percent of the cash equity and 99 percent of the tax equity in Three Cedars, including funding of construction. SunEdison expects to fully finance the $80 million balance of the capital for Three Cedars through a loan from Deutsche Bank through construction and long-term ownership. Dominion's aggregate investment in the joint venture is approximately $830 million to acquire 50 percent of the cash equity and 99 percent of the tax equity in Four Brothers and Three Cedars, including funding of construction.
SunEdison's 50 percent interest in both the Four Brothers and Three Cedars projects are on the Call Right Projects List for TerraForm Power, Inc. (TERP), a global owner and operator of clean energy power plants.
"We are excited to expand our partnership with Dominion to a total of 685 megawatts of solar in Utah," said Paul Gaynor, executive vice president of SunEdison EMEA & Americas. "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."
The Three Cedars project is expected to produce enough electricity to power more than 36,000 homes. As an added benefit, the construction of the solar power project is expected to create an estimated 250 construction jobs within the rural communities of Iron County and produce $17 million in direct property and income taxes over 20 years.
Separately, SunEdison and J.P. Morgan Asset Management's Infrastructure Investments Group, today announced a strategic partnership to fund renewable energy projects in both operating and construction stages, an initial investment of which will be a 33 percent interest in a 425 MW AC portfolio of diverse, domestic solar assets owned by Dominion.