SDCL Energy Efficiency Income Trust is investing $177m (€140m) to buy a US commercial district energy business from a Stonepeak Infrastructure Partners fund.
The UK-listed investment company has agreed to buy RED-Rochester from an unnamed fund managed by an affiliate of Stonepeak.
SDCL said it will fund the acquisition from existing cash reserves and revolving credit facilities, which includes the capital raised in the equity fundraising in February.
RED has 117MW of steam turbine generators plus boilers, chillers and other equipment that provide exclusive utility services to commercial and industrial customers within the 1,200 acre Eastman Business Park, located in Rochester, New York.
Since 2016, RED has delivered more than 40 energy efficiency projects across its operations. Additionally, the investment manager has identified a further pipeline of potentially accretive energy efficiency initiatives that it believes can deliver additional cost and carbon savings.
Jonathan Maxwell CEO and founder of SDCL’s investment manager Sustainable Development Capital, said: We expect the project to make positive contributions to SDCL’s earnings and cash flow.
“At the same time, the project offers the potential for growth over the medium to long term through the addition of new customers and the implementation of accretive energy efficiency measures.”
To read the digital edition of the latest IPE Real Assets magazine click here.
