19 Oct 2016 07:00
Plutus PowerGen Plc / Ticker: PPG / Index: AIM
19 October 2016
Plutus PowerGen plc ('PPG' or 'the Company')
LOI to Develop Gas Powered Energy Generation Portfolio in the UK
Plutus PowerGen plc, the AIM listed power company focused on the development, construction and operation of flexible power projects in the UK, is pleased to announce that it has signed a Letter of Intent with a specialist UK based energy company to work together to develop a 100MW gas-powered energy generation portfolio. The agreement, which is subject to contract, will expand the Company's power supply capabilities and is in line with its strategy to become a dedicated merchant supplier and producer of energy for the UK market.
Following completion of the transaction, it is anticipated that five 20MW gas powered sites will be constructed to supply flexible on demand power to the UK grid. These sites will be developed in tandem with the 200MW diesel power generation portfolio currently being advanced by PPG. It is expected that construction will be funded through debt and (minority) equity, which would enable site development without being dilutive to PPG shareholders.
PPG is committed to exploiting its existing pipeline which is comprised of land capable of hosting approximately 700MW of renewable fuel-powered flexible power generation capacity. This contemporaneous action to move into gas powered energy generation will diversify PPG's offering, provide an additional revenue stream and further de-risk its business model.
PPG Chairman Charles Tatnall said, "This agreement to build a gas powered portfolio represents a highly positive step towards achieving our stated objective of becoming a leading flexible energy supplier in the UK. Our entry into gas powered generation diversifies our offering, provides us with an additional revenue stream and solidifies our market position as an alleviator of the rising UK power supply issues. We are excited about the potential impact this deal has on our business and look forward to providing updates on developments at the appropriate time."
**ENDS**
For further information, please visit www.plutuspowergen.com, or contact:
Charles Tatnall | Plutus PowerGen Plc | Tel: +44 (0) 20 3705 8350 |
Phil Stephens | Plutus PowerGen Plc | Tel: +44 (0) 20 3705 8352 |
Ewan Leggat | SP Angel Corporate Finance LLP | Tel: +44 (0) 20 3470 0470 |
Laura Harrison | SP Angel Corporate Finance LLP | Tel: +44 (0) 20 3470 0470 |
Elisabeth Cowell | St Brides Partners Limited | Tel: +44 (0) 20 7236 1177 |
Hugo de Salis | St Brides Partners Limited | Tel: +44 (0) 20 7236 1177 |
Notes to Editors
Plutus PowerGen plc is an AIM listed company focused on the development, construction and operation of flexible stand-by power generation sites in the UK. At present, the market dynamics for flexible power generation are positive as a result of the continued downward pressure on capacity available to National Grid to balance supply and demand, leading to their announcements about possible power shortages over the next few years.
Flexible Power generators such as PPG offer a viable and timely solution to the power capacity shortfall in the UK. To this end, PPG is initially focusing on delivering 200MW of capacity by the end of 2017 and currently has a project pipeline of potential development sites with 700MW of power generation capacity.
PPG has a straightforward multi-revenue stream model with large and stable counter-parties and is using project/EIS funding through SPVs to finance construction of the generation assets. This structure has the benefit of limiting dilution to plc shareholders as the assets are financed and built.