Fortum, RDIF add two wind power plants in Kalmykia to renewables portfolio

Interfax, 30.06.2021

MOSCOW. June 30 (Interfax) - A joint venture between the Russian Direct Investment Fund (RDIF) and Fortum has acquired the Salynskaya and Tselinskaya wind power plants with total capacity of 200 MW in the Republic of Kalmykia.

"The investments further expand the portfolio of the JV," the companies said in joint press release.

The wind power plants in the Republic of Kalmykia were built by the Wind Energy Development Fund in full compliance with localization requirements and began supplying electricity to the wholesale electricity and capacity market (WECM) on December 1 2020. The power plants' revenues are guaranteed under long-term capacity supply agreements (CSA), which ensure the returns for investors.

Thanks to investments in WPP's in Kalmykia, the total capacity of the projects of the RDIF and Fortum joint venture has exceeded 600 MW. In December 2020, wind power plants in the Ulyanovsk and Rostov regions with a capacity of 350 MW were added to the joint venture portfolio. In March 2021 the partners announced the construction of the largest solar power plant (SPP) in Russia with a capacity of 116 MW in Kalmykia.

The board of directors at PJSC Fortum (MOEX: TGKJ) in June approved an option to acquire without a cash or other consideration 100% of Fourth Wind Farm LLC, which belonged solely to the Wind Energy LLC joint venture between Fortum and Rusnano and which included the the Salynskaya and Tselinskaya wind power plants.

Fortum and RDIF agreed back in 2019 to work together to find attractive opportunities for cooperation in the Russian renewable and thermal energy market. RDIF later received a 49% stake in one of Fortum's subsidiaries, Fortum New Generation-4, which implements projects in power generation and heat transmission via heating supply networks.

The RDIF in December 2019 announced that it would acquire finished and commissioned wind farms in the Ulyanovsk and Rostov Regions with a capacity of over 350 MW as part of a joint venture with Fortum. Fortum later issued a series of announcements, which indicated that FNG 4 would sell 100% of the shares of WEDF Second Wind Farms LLC and WEDF Third Wind Farms LLC, which own wind farms in the Rostov Region, to Fortum.

At the same time, in December 2020, Fortum's board of directors approved the buyout of WEDF Second Wind Farms LLC and WEDF Third Wind Farms LLC for no more than 21 billion rubles from Wind Power Asset Management LLC, which is the management company of WEDF)

In Russia Fortum owns 98.23% of PJSC Fortum, formerly TGK-10, and about 30% in PJSC TGK-1 (MOEX: TGKA) (principal shareholder - Gazprom Energoholding). Fortum also owns 73.4% of Uniper, which in Russia owns 83.73% of Unipro (MOEX: UPRO).

Fortum, jointly with Rusnano, is a member of the Wind Energy Development Fund, which has a portfolio of wind energy projects amounting to almost 2 GW. In addition, Fortum received the right to build 115.6 MW of solar generation.