Nippon Renewable Energy has received equity commitments of JPY26.1bn ($250m) from a consortium of private investment firms including Partners Group, Equis Funds, Babson Capital, LGsuper and Qantas Superannuation.
Raised through a joint investment platform Japan Solar, the proceeds from the investment will be used to fund Japanese solar generation facilities managed and operated by Nippon, which currently owns and will develop a pipeline of 300MW PV plants over the next two years.
The $250m investment will only finance 157.5MW of solar capacity extending into 2015, while a further fundraising is expected to be undertaken later this year to finance Nippon’s pipeline, a Partners Group spokeswoman told Pensions & Investments.
The pipeline includes four projects totalling 47.5MW in Oita, Hyogo, Hiroshima and Aomori prefectures, followed by a further 110MW of projects throughout 2014.
Having completed financing and construction documentation, the company will start construction on the projects shortly with electricity generation at the first one set to begin in the second half of 2014.
Each facility will benefit from 20-year power purchase agreements under the Japanese Ministry of Economy, Trade and Industry’s feed-in tariff (FiT) programme, which is aimed at providing renewable energy producers with stable cash flows and promoting investment in the sector.
Through its relationship with Japan Solar, Nippon has sufficient capital resources to move forward with projects on an all-equity basis if the need should arise.
Commenting on the development, Partners Group Private Infrastructure Asia-Pacific managing director and head Benjamin Haan said the firm is investing in the rapidly developing Japanese renewable energy market and supporting the Nippon management in filling the large power generation gap in Japan.
"We are confident of additional investment opportunities in the near term that will offer our clients the opportunity to further contribute to sustainable energy development in Japan," said Haan.
Image: Nippon Renewable Energy to develop 300MW of PV plants for the next two years. Photo: courtesy of freedigitalphotos.