Quinbrook Infrastructure Partners, a global investment manager, has signed two long-term offtake agreements accounting for 100% of the solar power generated at Cleve Hill Solar Park.
Cleve Hill, a 373MW solar + 150MW battery storage project, and the largest consented development in the UK, is due to start operations in early 2025. The project was granted development consent in 2020 and was the first of its kind to be approved as a Nationally Significant Infrastructure Project (NSIP).
Quinbrook has signed two separate agreements for the development. The first, accounting for 65% of the expected solar generation from Cleve Hill, is a 15-year power purchase agreement (PPA) with retailer Tesco, the largest solar corporate PPA executed in the UK to date.
Oil and gas company Shell has signed a ten-year route to market agreement to manage the remaining 35% of the development’s solar generation, which was secured by Quinbrook under a 15-year Contract for Difference (CfD) in July 2022.
Both offtake agreements provide long-term index-linked revenues for Cleve Hill, hedging against inflation and offering revenue certainty for investors. The deals are, according to Quinbrook managing director and UK regional lead Keith Gains, “testament to this landmark renewables project”.
Up to 10% of Tesco’s UK electricity demand will be met through the PPA, a “significant step” in the retailer’s journey to carbon neutrality by 2035, said Ken Murphy, group chief executive of Tesco.
He added: “With its ability to provide vital energy storage infrastructure, it’s a key part of the renewable energy strategy in the UK, and further evidence of our commitment to tackle climate change and source green electricity from innovative projects like this.”
Sharing that sentiment, head of power and systematic trading for Shell Energy Europe Rupen Tanna, said: “Combined solar and battery storage projects such as this have a vital role to play in driving forward the UK’s transition to a flexible and low-carbon energy future.”
The storage element of the project is particularly of note after an unsuccessful attempt by the local planning committee for Swale Borough Council to refuse consent for the addition of the battery energy storage system (BESS).
Commenting on the deals, Solar Energy UK chief executive Chris Hewett said: “Today’s news is a milestone for the UK’s fast-growing solar industry. The deal with Tesco is by far the largest corporate power purchase agreement the sector has ever seen, underlying the value proposition of large-scale solar power. We can expect to see more deals such as these in the coming years, as the industry scales up to reach 50GW of generation capacity by 2030.”