TIDMBSIF
RNS Number : 8204T
Bluefield Solar Income Fund Limited
22 July 2015
Bluefield Solar Income Fund Limited
Response to the Department of Energy and Climate Change's
Proposed Changes to Regulatory Support for Solar Assets
Bluefield Partners LLP ("Bluefield"), the Investment Adviser to
the Bluefield Solar Income Fund Limited ("BSIF"), has prepared a
statement following today's announced consultations on changes to
financial support for solar PV and changes to Feed-in-Tariff
("FIT") accreditation (the "Consultations") from the Department of
Energy and Climate Change ("DECC") and its proposed changes to the
regulatory support for solar assets.
Bluefield's statement
The proposals under the Consultations would have no impact on
the projects currently held in the BSIF portfolio. Further, each of
the sub-5MW construction projects in the pipeline currently being
considered by Bluefield on behalf of BSIF would qualify for the
Grace Period as proposed in the Consultations and would be eligible
for the current Renewables Obligation ("RO") level of support.
Bluefield also believes there will be future opportunities in
regard to sub-5MW projects that would qualify for the Grace Period
or that would be able to evidence the necessary significant
financial commitment pursuant to the proposals, as well as further
industrial and commercial projects. All of which provide a material
pipeline of potential construction assets up to at least April
2017.
Background context
-- The UK has been the largest market for solar plant
construction in Europe for the past two years. The Consultations
are a response to the significant increase in the installed
capacity of solar PV generation, especially large scale ground
based installations.
-- The proposals under the Consultations reflect the long-term
goal of DECC for meeting objectives on cutting carbon emissions and
continue to make progress towards the UK's 2020 renewable energy
targets while using the most cost effective regulatory support
available for the end consumer.
-- The proposals for regulatory changes are exclusively forward
looking and will have no impact on existing installed capacity.
-- Under the financial support for solar PV Consultation, the
proposals are for the early closure of the RO across Great Britain
to new solar PV projects of 5MW and below, as well as additional
capacity added to an accredited solar PV station up to 5MW total
installed capacity, which would mean that:
o projects that meet certain Grace Period eligibility
requirements and are installed up to 31 March 2017, there will be
no changes;
o projects that do not meet the Grace Period eligibility
requirements, but which: 1) can evidence significant financial
commitment prior to 22 July 2015; 2) meet all other current RO
eligibility requirements; and 3) are accredited by 31 March 2017,
will be eligible for the RO that applies at the date of
accreditation; and
o projects that cannot evidence significant financial commitment
prior to 22 July 2015, but which are accredited by 31 March 2016,
will still be eligible for the RO that applies at the date of
accreditation, subject to a proposed future consultation on banding
review.
-- Subject to the results of the financial support for solar PV
Consultation, DECC proposes a future consultation for the review of
RO banding for future sub-5MW solar PV projects.
-- The Feed-in-Tariff accreditation Consultation proposes the removal of pre-accreditation and pre-registration from the FIT scheme, whereby future installations will receive only the tariff rate as at the date of the relevant application for accreditation.
Policy Area
The Levy Control Framework (the "LCF") places a cap on how much
can be spent on schemes to fund renewables and other low carbon
electricity generation and was put in place so that the Government
can keep track of policy costs on consumers' electricity bills and
respond to the latest forecasts. Across all schemes under the LCF,
spending projections have been increasing, including as related to
solar generation. Breaching the LCF cap would have a direct impact
on consumers, as the LCF acts as a levy on consumer bills and
because it is assumed that any costs incurred by licensed
electricity suppliers are passed on to consumers in their energy
bills.
Current forecasts by the Government predict the deployment of
sub-5MW solar PV projects at a rate higher than provided for by
DECC's October 2014 consultation, which DECC expects to be a
significant cost to the LCF under RO. Further, the Government has
stated that the ability to pre-accredit under the FIT scheme
facilitates deployment under the scheme, by making it easier for
prospective generators to secure tariffs under the scheme, has also
fuelled deployment spikes preceding tariff changes under
"degression". The Government has stated that the policy must strike
a balance between encouraging investment and the cost risk borne by
electricity consumers.
Enquiries:
James Armstrong / Mike Rand / Giovanni Terranova
Bluefield Partners LLP - BSIF Investment Adviser
Tel: +44 (0)20 7078 0020
Tod Davis / David Benda
Numis Securities Limited - BSIF Broker
Tel: +44 (0)20 7260 1000
Kevin Smith
Heritage International Fund Managers Limited - BSIF Secretary
& Administrator
Tel: +44 (0)1481716000
Tom Karim
CNC
Tel: +44(0)20 3219 8820 / +44(0)7923 293 399
Note to editors
About Bluefield Solar Income Fund Limited (BSIF)
BSIF is a Guernsey-registered investment company focusing on
large scale agricultural and commercial and industrial solar energy
assets. It had an initial public offering of shares on the main
market of the London Stock Exchange in July 2013. It has,
currently, over 278 million shares in issue and a market cap of c.
GBP300 million. In June 2014 it agreed a three-year revolving
credit facility with Royal Bank of Scotland, for up to GBP50
million.
BSIF seeks to provide shareholders with an attractive return,
principally in the form of income distributions, by investing in a
diversified portfolio of solar energy assets, each located within
the UK, with a focus on utility scale assets and portfolios on
greenfield, industrial and/or commercial sites.
About Bluefield Partners LLP (Bluefield)
Bluefield was established in 2009 and is an investment adviser
to companies and funds investing in solar energy infrastructure. It
has a proven record in the selection, acquisition and supervision
of large scale energy and infrastructure assets in the UK and
Europe. The team has been involved in over GBP1.4 billion of solar
PV funds and/or transactions in both the UK and Europe since 2008,
including over GBP380m in the UK since December 2011.
Bluefield has led the acquisitions, and currently advises on
over 50 UK based solar assets that are agriculturally, commercially
or industrially situated. Based in its London office, Bluefield's
partners are supported by a dedicated and highly experienced team
of investment, legal and portfolio executives.
Bluefield was appointed Investment Adviser to BSIF in June
2013.
This information is provided by RNS
The company news service from the London Stock Exchange
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