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Enlight Enters Kosovo Wind Power Market

/9th May 2018, IGlobes Online, Israel Business News/ Enlight Renewable Energy Solutions Ltd. (TASE:ENLT) reported to the Tel Aviv Stock Exchange (TASE) that it had signed an agreement to acquire the rights in a wind energy project in Kosovo in the advanced development stages. The plant's planned capacity is 105 megawatts.

Enlight is owned by Eurocom Communications, part of the Shaul Elovitch's crumbling empire, together with several prominent investment management concerns: Psagot Investment House Ltd., The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5), Harel Insurance Investments and Financial Services Ltd. (TASE: HARL), and Sphera Funds Management.

Under the agreement, Enlight will gradually acquire ownership of all of the shares in the company owning the rights in the project, after a number of milestones have been achieved. The sellers will be paid an immediate advance of €1 million for 50% of the shares, subject to several suspending conditions. Later, when financing is closed, and subject to obtaining regulatory approval, the sellers will receive a payment to be calculated according to a formula agreed by the parties. On the date when commercial operation of the project commences, scheduled in 2020, Enlight will give the sellers the balance according to an adjustment formula, and will fully own the project company.

The project, which is expected to include 27 wind turbines, has already obtained most of the rights to the land, the environmental permits, and the important authorizations for completing development, including conditional authorization for entitlement to a quota and rate. Final approval is expected this year.

The project, whose projected cost is €140-180 million, is part of Kosovo's fee arrangement for wind facilities meeting regulatory milestones by specific dates set in advance by the regulator. The arrangement entitles the facility to a fee of €85 per megawatt for electricity for the grid for 12 years. After the fee period, the electricity will be sold under market conditions. The wind farm's estimated lifespan is 30 years.

Enlight believes that the project will generate €25 million in annual revenue during the 12-year fee period and NIS 15 million in annual revenue afterwards. Enlight is in initial negotiations to obtain financing for the project, and believes that the leverage of senior debt will amount to 60-80% of the total construction cost. Enlight adds that the electricity sector in Kosovo is managed automatically. Its electricity grid is connected to the main European electricity network, which includes a synchronized network in 25 countries. Kosovo has published regulatory targets of generating 400 megawatts from renewable energy sources, including 150 megawatts from wind energy.

Enlight's share price responded to the news by rising 1%, and has gained 40% over the past year. The company's market cap is NIS 914 million.

Enlight CEO Gilad Yavetz said today, "The new agreement leverages the company's core capabilities in development and optimization of wind energy projects. This is the company's third project in the Balkan region. It will benefit from the advantages, capabilities, and know-how accumulated by the company in the course of its intense activity in this region. The company is acquiring the rights from parties with a great deal of international experience in planning and constructing wind projects, and will work in cooperation in the coming period in order to bring the project to the finish line, while creating synergy between the two parties' development, construction, and financing capabilities."

More information about Enlight activities at wind power market of Kosovo you may read here: Enlight buys rights to Kosovo wind farm project

More information about Kosovo wind power market you may read here: Western Balkans Wind Power Market: Outlook 2017÷2026

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Serbia has considerable renewable energy resources characterized by seasonal complementarity of solar and wind energy potentials. The calculated wind power in the windiest parts of Serbia is comparable to the wind power of some of the windiest parts of Europe, situated in countries which are, not surprisingly, also the most active investors into wind energy facilities. The Koshava-wind region, characteristic of the Danube river valley between the towns Slankamen and Golubac, and Smederevska Palanka and Zrenjanin, has been identified as the windiest part of Serbia. There are also some mountainous regions with considerable wind energy potential.

When the Alibunar and Cibuk 1 wind farms whirr into action in 2019, Serbia’s as-yet-untapped renewable energy potential will become its power—literally. IFC is helping make this move possible, lending €19.1 million to Belgian renewable-energy firm Elicio for the construction of the 42-megawatt (MW) Alibunar wind farm. This will help reduce Serbia’s carbon emissions by more than 120,000 tons per year.

IFC is also providing a €107.7 million lending package to a joint venture developing a 158-MW wind farm, the largest in the Western Balkans. The €300 million Cibuk 1 wind farm is a partnership between Abu Dhabi Future Company Masdar, from the United Arab Emirates, and Cibuk Wind Holding, a subsidiary of U.S.-based developer Continental Wind Partners. The project will reduce an estimated 370,000 tons of carbon dioxide per year.

IFC’s support for renewable energy—via investments such as these, and the years-long advisory work with the Serbian government that laid the foundation for these investments—reflects our commitment to improving access to electricity. Together, these two wind farms will offer an electricity supply to more than 1.9 million residents in the northern province of Vojvodina. The amount of carbon emissions avoided by both projects is equivalent to taking more than 100,000 vehicles off the road.

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