EnerCap Plans $466 Million for Heat and Power as Renewables Wane

EnerCap Capital Partners, a Czech Republic-based private equity company, plans to invest in combined heat and power plants in central and eastern Europe as policy changes in the region make renewables less attractive.

EnerCap plans a new fund to raise as much as 350 million euros ($466 million) for the technology, Shane Woodroffe, a partner at the Prague-based company, said by phone. EnerCap may also sell assets in its 98 million-euro renewables fund with wind farms in Poland, Romania and the Czech Republic “in one piece, or in two or three pieces,” he said.

EnerCap decided to focus on gas and biomass-fired CHP projects rather than on renewable power because of “current uncertainties” about government support for wind and solar in countries such as Romania and Poland, Woodroffe said. Those nations are seeking to reduce financial support for clean power to stem costs to consumers.

The company has secured a pipeline of CHP projects in the region, it said in a separate statement. CHP plants conserve energy by using the heat created as a byproduct of making electricity.

Woodroffe spoke as EnerCap made the final investment from its existing EnerCap Power Fund in the first 42-megawatt phase of a wind park in western Croatia slated to be the nation’s biggest when its second 12-megawatt stage is added.

Project Finance

The Obrovac wind farm’s first phase will cost 66.7 million euros, Woodroffe said. EnerCap won 50.6 million euros in loans from UniCredit SpA and Erste Group Bank AG to finance the project, it said yesterday in a statement.

The debt comprises a 15-year loan from UniCredit Bank Austria and Erste, as well as a VAT facility from UniCredit’s Zagrebacka Banka unit. The park, which also has a guarantee from Denmark’s export credit agency Eksport Kredit Fonden, is about 20 kilometers (12 miles) from the port of Zadar.

The first phase with 14 turbines made by Vestas Wind Systems A/S of Denmark will start operating next year, according to EnerCap. The EnerCap Power Fund has invested in six projects including Obrovac totaling 320 megawatts in Poland, Romania and the Czech Republic, according to the company.

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