Good Energy Group PLC, which supplies and generates 100% renewable electricity, carbon neutral gas and feed in tariff administration services to over 239,000 UK homes and businesses, is pleased to announce the following operational update.
Sale of operational 5MW solar site in Dorset
Following a competitive tender process the Board has agreed to terms for the sale of its operational 5MW Oaklands solar farm to Eneco UK Limited (“Eneco”) for £5.78m as well as an option to purchase power from the site. As part of the sale, Good Energy will retain asset management services for the site.
Working with the Eversheds LLP legal team contracts have been exchanged and the transaction is expected to complete on or around 3 January 2017. The total sale value will be paid in cash on completion with the net profit from the sale expected to be in the range of £340k to £390k. The profits resulting from the sale will be recognised in Good Energy’s results for the year ended 31 December 2017.
The sale of Oaklands evidences further delivery of Good Energy’s ongoing strategy to actively manage its generation portfolio to realise maximum value through developing renewable assets and securing access to long term power.
Funds from this sale will be used to support the construction of further solar sites before the 31 March 2017 renewable obligation certificate (“ROC”) subsidy deadline.
Like all suppliers Good Energy has experienced exceptional volatility in the short term power trading market from late October to late November.
While the Company operates a prudent risk management process and hedging policy to mitigate trading risk, this volatility has led to more challenging trading over that period. Notwithstanding this, the Board still expects the Company to meet the lower end of market expectations, assuming the more favourable trading conditions experienced to date in December continue until the end of the month.
Juliet Davenport, OBE, Founder and CEO of Good Energy said:
“Good Energy developed, constructed and has been operating the Oaklands site since January 2016, showcasing the capabilities of our generation team.
The sale to Eneco gives us optionality over the power from Oaklands and continues our strategy of selling sites and reinvesting to develop renewable assets, helping the UK to become more energy self-sufficient.
This is our first project with Eneco and we look forward to working with them as we manage this great site.
While the short term trading conditions have been tough from late October through to late November we have seen a return to more normal trading conditions in December.”