Downing Renewables & Infrastructure Trust plc (DORE) has agreed to buy two operational portfolios of hydropower plants located in central Sweden for €25 million.
The firm has acquired a 12GWh portfolio of hydropower plants from ÄSI Kraft AB located in the SE3 electricity pricing zone for approximately €6 million and a 36GWh portfolio located in the SE2 zone for approximately €19 million from AB Edsbyn Elverk.
The acquisitions have been largely funded through drawdown on its Downing Hydro AB (DHAB) Swedish hydropower portfolio debt facility signed in November 2021. The acquisitions are expected to close this week.
The first portfolio comprises five hydropower plants located on three different rivers in central Sweden, while the second portfolio includes four run-of-river hydropower plants situated on a single river in and around the Swedish town Edsbyn in central Sweden.
The acquisitions increase DORE’s total number of managed Swedish hydropower plants to 17, with a total annual average production of 157GWh. The hydropower plants acquired will be integrated into the existing portfolio of hydropower plants in Sweden owned by Downing Hydro AB and will support DORE's strategy, which focuses on diversification by geography, technology, revenue and project stage, designed to increase the stability of revenues and the consistency of income to shareholders.
"We are pleased to expand our hydropower portfolio in Sweden,” commented Tom Williams, Partner, Head of Energy and Infrastructure at Downing LLP. “These attractive acquisitions will increase DORE's hydropower production by just under 50% and add three more directly controlled storage reservoirs in SE3 and benefit from further seasonal storage reservoirs in SE2. They will also allow DORE to benefit from the economies of scale that come with further growth. Hydropower is often forgotten as a source of renewable power, but it will be key part of the energy transition as it is possible to hold energy back in the reservoirs and sell when supply from renewable sources elsewhere is low. This helps reduce price volatility and maximises the value of the energy stored for end users and our investors."