Business
RE Royalties Enters into Additional CAD $0.8 Million Loan Agreement with Switch Power for Energy Storage Projects in Ontario
All amounts in Canadian dollars unless otherwise stated VANCOUVER, BC / ACCESSWIRE / Oct...
About this update from Re Royalties Ltd.
[{"type":"text","content":"RE Royalties Enters into Additional CAD $0.8 Million Loan Agreement with Switch Power for Energy Storage Projects in OntarioAll amounts in Canadian dollars unless otherwise statedVANCOUVER, BC / ACCESSWIRE / October 5, 2021 / RE Royalties Ltd. (TSXV:RE) (\"RE Royalties\" or the \"Company\"), a global leader in renewable energy royalty-based financing, has entered into a second loan agreement with Switch Power Ontario Battery Operations Corp. (\"Switch OpCo\"), a wholly owned subsidiary of Switch Power Corporation (\"Switch Power\"), for $786,750 (the \"Second Acquisition Loan\") to finance the purchase of a portfolio of ten battery energy storage development projects located in Ontario (the \"Development Projects\").The Development Projects will have a capacity of 21 MW, and Switch OpCo will receive revenue from several sources, with the majority coming from Energy Services Agreements (\"ESAs\") with the building owners. Under the ESAs Switch OpCo may receive a percentage of the cost savings generated by the batteries, primarily through reducing the charges under the Independent Electricity System Operator's Global Adjustment program.The Development Projects will be deployed with large real-estate, asset management, and industrial customers. It is estimated the portfolio will offset nearly 1,170 tonnes of CO2 per year, equivalent to taking over 250 gas-powered cars off the road. These energy storage systems will accelerate Ontario's transition to a decentralized, decarbonized, and resilient electricity grid. For customers, they will help reduce their carbon footprint while lowering costs and unlocking new cost savings through electricity use optimization. The Development Projects are expected to be operational between the summer of 2022 and the summer of 2023.The Second Acquisition Loan will have a term of 23 months and bear an interest rate of 10% per annum, compounded monthly, and payable at the end of the term. The Company will also receive a sliding scale royalty of between 3.5% to 5% on gross revenues generated by the Development Projects, once funded and constructed, for the life of the ESAs for a 10-15 year initial term with options to extend.This loan is RE Royalties' second transaction with Switch Power following on the $2.3 Million loan and royalty transaction completed in early September for four operating projects to...