Shikun VeBinui expands in the US: acquired 49% of energy storage facility for NIS 190 million

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by Ifi Reporter Category:Financial May 2, 2021


Shikun VeBinui, controlled by Nati Saidoff, continues to expand its activities in the renewable energy market in the United States. Shikun VeBinui acquired 49% of a 400-megawatt energy storage facility under construction north of Los Angeles for NIS 190 million. By the Swiss investment fund Capital Dynamics, which specializes in investing in renewable energy assets.
The project was purchased from Strata Solar and is located in the city of Oxnard, located 40 km north of Los Angeles. It was established at a total cost of NIS 750 million, financed in equal parts by equity and bank financing for 10 years. A watt that will operate for at least four hours, the operation and maintenance of the facility will be done by Ayalon Musk's Tesla company, on a 20-year contract.
The storage facility is not related to a renewable energy project. It is located near the junction of the power grid so that it can provide services to the grid. The energy storage facility will generate revenue from three sources: an availability payment that provides a third of its expected revenue; Ancillary services that the facility provides to the electricity grid such as frequency stabilization and load absorption; A third of the revenue will come from the sale of electricity, taking advantage of differences between day and night rates.
Shikun VeBinui, managed by Tamir Cohen, expects a double-digit return from the project and is expected to leverage the project so that after the risks of construction and operation of the facility have decreased, the bank debt will finance 70% of its construction costs. "Shikun VeBinui believes this is a strategic deal because there is significance to a rapid penetration of the U.S. energy storage market, which is growing at a rate of 30% -40% per year."
This is not the first time that Shikun VeBinui has been involved in a renewable energy business with the Capital Dynamics Fund. In October 2020, Shikun VeBinui acquired 50% of Capital's photovoltaic power plant Beacon Solar, northeast of Los Angeles, from a capacity of 108 megawatts. The balance of the holdings in the station is owned by a tax partner who is entitled to all the benefits inherent in the losses that the station produces in its first years, due to provisions for depreciation.
The station, which is part of a 250-megawatt solar-powered complex, began operating in 2017 and provides its full production capacity under a 25-year fixed-price agreement with the Los Angeles Electric Company. The cost of the investment in the project was NIS 900 million, and the remaining debt in the project is NIS 600 million.
The deal was executed at a high yield of 8% -9% thanks to the exploitation of the corona crisis and the desire of the property owner, Capital Dynamics, to realize the property quickly and through direct negotiations with you and not through a tender. The Swiss fund specializes in renewable energy, Of this, $ 6.5 billion is in renewable energy. The transaction was carried out by the US division of Shikun VeBinui, which is managed by Alon Raveh.

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