Lightsource bp has secured a proxy generation power purchase agreement (pgPPA) with the Capital Solutions unit of Allianz Global Corporate & Specialty (AGCS), in partnership with Nephila Climate. The pgPPA is for electricity generated by Lightsource bp’s 153 megawatt Briar Creek solar farm, located in Navarro County, Texas.
A pgPPA is an innovative renewable energy contract structure intended to manage weather related risk. A pgPPA is similar to a virtual PPA, except it settles energy on a proxy generation index rather than the metered generation. Proxy generation is an hourly index that specifies the volume of energy that a project would have produced if it had been operated as specified by the developer or owner. REsurety, Inc. provided analysis in support of the transaction and will serve as the calculation agent for the life of the contract.
“AGCS is excited to collaborate with Lightsource bp on this novel renewable energy hedge structure and risk management tool,” said Vijay Suchdev, Managing Director at AGCS. “We are committed to working with our partners to achieve their sustainability goals and to supporting the long-term global growth of renewable energy.”
The Briar Creek solar farm, located about 40 miles south of Dallas, is expected to start commercial operation at the end of 2021.
“This deal is a great example of the evolution of renewable energy products here in the US,” said Kevin Smith, CEO of Lightsource bp in the Americas. “Innovative power contract structures such as virtual and proxy generation PPA’s are valuable tools we can leverage to meet the needs of our corporate partners, manage risk, and continue to finance and build new solar projects for our low carbon future.”
“Nephila Climate is pleased to be playing a part in the realization of the Briar Creek solar farm, and Lightsource bp’s mission to deliver affordable and sustainable solar power in the US and around the world,” said Ariane West, Director of Structured Finance, Nephila Climate. “Risk transfer solutions designed to meet the needs of the renewable energy market are essential to support investment and financing of infrastructure on the scale needed to achieve zero carbon targets. We are proud to be working with market leading partners to create those solutions.”
The solar project will also deliver local economic benefits beyond clean and economical electricity for the Dallas Fort Worth area. The project:
- Is expected to generate $19.7 million in property tax revenue to Navarro County over its life, benefitting local schools and other community public services
- Will create about 250 jobs during construction, with local labor and service requirements included in construction contracts
- Brings $152 million of private capital investment in new, local energy infrastructure for Texas
About Lightsource bp
Lightsource bp is a global leader in the development and management of solar energy projects, and a 50:50 joint venture with bp. Our purpose is to deliver affordable and sustainable solar power for businesses and communities around the world. Our team is comprised of 500 industry specialists, working across 14 countries. We provide a full service to our customers, from initial site selection, financing and permitting through to long-term management of solar projects. Lightsource bp in the US is headquartered in San Francisco with development offices in Denver, Philadelphia, Atlanta and Houston. Since the company announced its strategic expansion into North America in late 2017, the team has developed a pipeline of more than 8 gigawatts of large-scale solar projects at various stages of development across the United States with about 2 gigawatts of contracted assets representing almost $2 billion in near term projects. For more information visit lightsourcebp.com, follow us on Twitter @lightsourceBP and Instagram @lightsourcebp or view our LinkedIn page. For media inquiries, please contact Mary Grikas at firstname.lastname@example.org.
About Allianz Global Corporate & Specialty
Allianz Global Corporate & Specialty (AGCS) is a leading global corporate insurance carrier and a key business unit of Allianz Group. We provide risk consultancy, Property-Casualty insurance solutions and alternative risk transfer for a wide spectrum of commercial, corporate and specialty risks across 10 dedicated lines of business. Our customers are as diverse as business can be, ranging from Fortune Global 500 companies to small businesses, and private individuals. Among them are not only the world’s largest consumer brands, tech companies and the global aviation and shipping industry, but also wineries, satellite operators and Hollywood film productions. They all look to AGCS for smart answers to their largest and most complex risks in a dynamic, multinational business environment and trust us to deliver an outstanding claims experience.
Worldwide, AGCS operates with its own teams in 31 countries and through the Allianz Group network and partners in over 200 countries and territories, employing over 4,450 people. As one of the largest Property-Casualty units of Allianz Group, we are backed by strong financial ratings. In 2019, AGCS generated a total of €9.1 billion gross premium globally. www.agcs.allianz.com
About Nephila Climate
Nephila Capital Ltd is a leading investment manager specializing in (re)insurance and weather risk. Nephila Climate is a dedicated weather and climate risk transfer and ESG-driven business linked to climate resilience and sustainability. Nephila offers a broad range of investment products focusing on instruments such as insurance-linked securities, catastrophe bonds, insurance swaps, and private transactions. Nephila Capital Ltd has approximately $10.2 billion in assets under management of as of December 1, 2020 and has been managing institutional assets in this space since it was founded in 1998. The firm is headquartered in Bermuda, with offices in San Francisco, CA, Nashville, TN and London. There are currently over 260 employees with expertise in finance, seismic engineering, catastrophe and climate modeling, risk management and traditional underwriting. Further information can be found at nephilaclimate.com or nephila.com
REsurety, Inc. is the leading provider of valuation analytics and risk management services to buyers and sellers of renewable energy. With deep expertise at the intersection of weather and power markets, REsurety has built unrivaled databases and analytical systems that enable a more precise understanding of the value and risk of intermittent power generation. Having supported nearly 7,000 MW of transactions since 2015, REsurety is rapidly changing the way renewable energy is bought and sold across the globe. For more information, visit www.resurety.com.
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