DIF establishes solar strategic partnership in France

Dutch Infrastructure Fund (DIF) has acquired a tranche of a solar project in France from EDF Energies Nouvelles, a French renewable energy corporation. The Gabardan solar photovoltaic project will be the largest photovoltaic plant in Europe.

DIF Infrastructure II, a fund managed by Dutch infrastructure manager DIF, has established a strategic partnership with EDF Energies Nouvelles (EDF EN), a French renewable energy corporation, by acquiring an 11.7 MWp (megawatt-peak) tranche of EDF EN’s photovoltaic power project in France, the company said in a statement.

DIF has acquired 100 percent of the equity in Gabardan 2, an 11.7 MWp tranche of the larger EDF-owned Gabardan solar photovoltaic power project.

The fund has acquired only 11.7 MWp tranche of the entire 76 MWp solar project because of a '500 metre rule' in French law that allows one party to own only up to 12 megawatts of assets within a 500 metre area. The purpose of this rule is to give smaller players a chance to develop assets and invest in renewable energy, a source close to the company told Infrastructureinvestor.com.

DIF invests in renewable assets through its DIF Renewable Energy fund, which had a final closing in 2008 at €134 million. DIF Infrastructure II, which has been set up to acquire renewable energy and PPP assets, has a target size of €500 million. Furthermore, DIF manages a PPP fund of €150 million, which was set up in 2006.

The company is planning to acquire more renewable energy assets in the near future and adding it to its current portfolio of 450 megawatts.

Located in the region of Landes, in the south-west of France, the Gabardan project will be the largest photovoltaic plant in Europe. The operation and maintenance of the entire facility will be managed by EDF EN.

Currently, the project is in construction and is expected to become fully operational by the end of 2010. It has been financed with a non-recourse loan facility provided by Commerzbank and ASN Bank.

Gabardan is expected to produce enough power each year to cover the annual consumption of around 5,000 households.

Last month, DIF acquired three wind projects – an onshore wind farm with a capacity of 8 megawatts in Germany, a 9.2-megawatt wind project and a 20-megawatt wind project in France.

DIF Infrastructure II is an equity fund established to invest in European infrastructure assets targeting primarily PPP/PFI concessions and renewable energy projects. Established in 2005, the company currently manages a portfolio of €500 million of PPP/PFI and renewable energy assets.