Tilt bids for Victorian supply contract using proposed A$600M Dundonnel wind farm
By Paul McBeth
Feb. 14 (BusinessDesk) - Tilt Renewables is bidding for a 15-year power contract with the Victorian state government and would use both new equity and debt to build an A$600 million, 80-turbine wind farm to supply the renewably-sourced electricity.
The Auckland-based company, which was carved out of Trustpower in 2016, applied for a portion of the Victorian Renewable Energy Auction Scheme(VREAS) which is seeking suppliers for 650 megawatts of new capacity. The outcome is expected to be known in July, and if successful construction will begin later this year with a view to generating power in 2020, Tilt said in a statement.
"Participation in the VREAS presents an opportunity for Tilt Renewables to secure a 15-year contract from the Victorian Government which will provide price certainty for a portion of Dundonnell’s generation output which will underpin the investment decision to proceed with the project," chief financial officer Steve Symons said. "Dundonnell is a high-quality development opportunity and Tilt Renewables believes that it has submitted a strong bid into what is expected to be a highly competitive process."
The company has been focused on building the 54-megawatt hour Salt Creek Wind Farm by July and has signed a supply contract with Meridian Energy to supply its Australian Powershop retail business. Tilt's development activity has prioritised the 300 MWh Dundonnell Wind Farm which was due for an investment decision in mid-2018.
Tilt has secured a fully committed debt package from National Australia Bank and the Bank of Tokyo-Mitsubishi UFJ to cover half the construction cost and expects to raise the other A$300 million through new equity. Cornerstone shareholder Infratil has agreed to fully underwrite an equity raising for Dundonnel.
"Dundonnell is a major development project in Tilt Renewables’ portfolio, and one which Infratil supports," Infratil said in a separate statement.
Tilt shares were unchanged at $1.93, while Infratil stock gained 1.8 percent to $3.135.