Israel’s Ashtrom Renewable Energy, a renewable energy developer and subsidiary of Ashtrom Group, has signed a green financing totaling $270M with a group of five banks viz. BHI, the US operation of Bank Hapoalim Group, Bayerische Landesbank, ING Capital, Rabobank and Societe Generale.
In addition, Ashtrom Renewable Energy signed a Tax Credit Transfer Agreement (TCTA) to sell the production tax credit (PTC) to be produced by the project over a ten-year period to a highly rated (Aa3 Moody’s) U.S. institutional entity. The total value of the PTC is estimated at $300 million.
As per reports, the Tierra Bonita project is located on a ~2,400 acres site in Pecos County, Texas, with a planned capacity of ~400MWdc (306 MWac). It is currently under construction and commercial operation is expected by Q4 2024. It is one of the very first solar projects in the U.S. to complete a Tax Credit Transfer Agreement for solar PTCs under the new Inflation Reduction Act (IRA), and complete financing under a project finance structure.. The financing for the project was structured as a Green Loan in alignment with Green Loan Principles and with ING as the Green Loan Structuring Agent.
“The financial closing of the Tierra Bonita project marks a significant milestone for Ashtrom Renewable Energy, demonstrating confidence in our strong capabilities to execute the
development, planning, financing and construction of our first large-scale solar project in the U.S., with a total investment of approximately $435 million,” said Yitsik Mermelstein, CEO at Ashtrom Renewable Energy.
“In addition, we have also entered into a pioneering agreement to sell the project tax credits to a leading U.S.-based institutional entity for an estimated value of $300 million. This follows our PPA agreement from last year to sell ~60% of the project’s electricity to the CPS Energy (Aa2 Moody’s) the municipal utility of San Antonio for a 20-year term.” he said.