SunEdison, Inc. today announced they have signed a definitive agreement with Dominion, establishing a joint venture (JV) for Four Brothers, a 420MW DC, or 320MW AC, solar project in Utah, developed by SunEdison. The project is now under construction and fully financed with an expected commercial operation date of mid-2016. The Four Brothers project is contracted under long-term power purchase agreements for 20 years with PacifiCorp.
Under the terms of the JV, Dominion will invest approximately $500 million to acquire 50 percent of the cash equity and 99 percent of the tax equity in Four Brothers, including funding of construction. SunEdison will contribute the remaining portion of the capital required to complete the project, which it has fully financed through a $150 million four-year term loan with Deutsche Bank. The total $650 million financing package fully funds the project for completion and long-term ownership.
Four Brothers generates approximately $40 million dollars of unlevered cash available for distribution (CAFD) to Dominion and SunEdison. SunEdison's 50 percent interest in the Four Brothers project is on the Call Right Projects List for TerraForm Power, Inc.
"We are very pleased to establish a great strategic partnership with Dominion, one of the nation's largest and most innovative producers of energy in jointly owning the Four Brother project," said Paul Gaynor, executive vice president of SunEdison EMEA & Americas. "From a financial perspective, the Dominion partnership demonstrates the quality of our project and provides SunEdison and TerraForm Power with a complete solution for the construction and permanent financing of this 420 MW solar facility. This solar project will also bring clean, affordable electricity to Utah residents and businesses while providing attractive returns for its owners. This partnership represents a major investment in the Utah economy, and creates both local jobs and steady income for the state from property and other taxes."
The Four Brothers project is expected to produce enough electricity to power more than 90,000 homes. As an added benefit, the construction of the solar power project is expected to create an estimated 500 construction jobs within the rural communities of Beaver and Iron Counties and produce $66 million in direct property and income taxes over 20 years.