Southern Power, a subsidiary of Southern Company, expands its renewable energy portfolios by acquiring the 200MW Tranquillity Solar Power Project in California from Recurrent Energy, a subsidiary of Canadian Solar. Tranquillity Solar Power Project is currently under construction by Recurrent Energy. Signal Energy Constructors serves as the EPC provider.
Under the terms of the agreement, Southern Power will acquire approximately 51% of the solar generation project. Canadian Solar will retain 49% ownership and contribute its share of the investment required to complete the construction of the project, which the company has fully financed through a construction and back-leveraged loan facility with a syndicate of six banks.
The Tranquillity Solar Project represents Southern Power and Recurrent Energy’s first partnership. Covering an area of 1,900 acres in Fresno County and utilizing more than 800,000 polycrystalline PV solar modules mounted on tracking tables, the plant is scheduled to reach commercial operation in the fourth quarter of 2016 and is expected to generate enough clean energy to power approximately 55,000 homes.
The electricity and associated renewable energy credits (RECs) generated by the facility will be sold to Southern California Edison under a 15-year power purchase agreement.
"Southern Power's investment in the Tranquillity project is another example of solar power's move into the utility's diverse generation mix and further shows the Recurrent Energy team's ability to partner with energy industry leaders," said Canadian Solar Inc. Chairman and CEO Dr. Shawn Qu. “The project is also an attractive opportunity for investors which will provide long-term stable cash flows.”
Southern Power has announced, acquired or is constructing more than 1,300 MW of renewable facilities with 19 solar, wind and biomass projects.This facility adds further diversity and reliability to the Southern Company system's generation mix of nuclear, 21st century coal, natural gas, renewables and energy efficiency. In addition, the transaction fits Southern Power's business strategy of growing its wholesale business through the acquisition and construction of generating assets substantially covered by long-term contracts.