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Management Contract Awarded for Two Further 20MW Projects
Plutus PowerGen plc, the AIM listed power company focused on the development, construction and operation of flexible stand-by electricity generation in the UK, has announced that it has been awarded two further management contracts for the construction and operation of 20MW flexible stand-by electricity plants, by SelectGen Limited and Reliance Generation Limited being two major customers of Rockpool Investments LLP.
Rockpool has invested £4.1 million of equity into each company, which brings the total invested by Rockpool investors into companies to be managed by PPG to £33.2 million.
This agreement brings the total number of management contracts granted to PPG to nine, equivalent to 180MW. Under the agreements, PPG will be paid £150,000 per annum by each company for these services in addition to an equity stake of 45% in the capital of each company. Both SelectGen Limited and Reliance Generation Limited were funded by Rockpool prior to 30 November 2015 when Enterprise Investment Scheme relief was withdrawn from companies whose activities involve the provision of reserve power capacity and generation. Rockpool previously allocated £3.2 million of equity to each customer. Considering the increase in the equity component allocated, less asset financing will be required to bring the projects sourced for these two companies into operation.
Phil Stephens, CEO of PPG said, “These management contracts provide us with additional revenues of £300,000 per annum in addition to a 45% stake in two further projects. With the equity component for nine 20MW projects now funded through EIS, ahead of the change in policy for this type of funding, we have a solid project portfolio in varying stages of development to support our growth as we focus on securing flexible electricity projects where we hold a significantly larger equity stake in line with our ongoing strategy. We expect 2016 to be characterised by strong progress and activity. In the short term shareholders can expect updates on funding arrangements for new projects, as well as regarding the progress being made on the ground at the three sites for which we have received planning consent. Importantly, our projects are in strong demand due to the continued constrained supply dynamics facing the UK energy sector.”
