Joint venture to meet solar energy demand

As concerns over the critical phase into which conventional energy looms the economies around the globe, a new venture is expecting to grow up to the expectations of the renewable energy market. The joint venture initiated by Solar Millennium and MAN Ferrostaal Inc. is a move towards capitalising on the growing demand for “other” sources of energy generation.

Solar Millennium AG, Erlangen, has restructured in the US to react to the rapidly growing demand for solar thermal power generation. Moving forward, all activities in the US market will be consolidated into one new joint venture, Solar Trust of America, LLC (STA). Solar Millennium owns a total of 70 per cent in this JV via affiliated companies.

The remaining 30 per cent are held by MAN Ferrostaal Inc., Cleveland (Ohio), an affiliate of MAN Ferrostaal AG, Essen. Solar Millennium has contributed its former US project development company, Solar Millennium LLC, of Berkeley, California, into the JV as the U.S. solar development arm of STA.

Solar Millennium LLC already has long-term power purchase agreements (PPAs) for up to three parabolic trough power plants with a capacity of 242 MW each in California and is currently working with Nevada Energy to develop projects in the Amargosa desert. There are also other projects planned. STA will actively pursue project development in key Southwestern states, utilising its business units' Project Development, Financing, Engineering, Power Plant Construction and Investment expertise.

STA will cover the entire value chain for solar thermal power plants in the U.S. To finance the growth plans of STA, various options for equity capitalisation in the US are currently being examined.

Christian Beltle, CEO of Solar Millennium AG: "We already work closely with MAN Ferrostaal in Europe, North Africa and the Middle East. By consolidating our activities and expanding our collaboration with MAN Ferrostaal we are strengthening our position in the U.S. market. At the same time we are putting the speedy and reliable implementation of our projects on a firm footing. Solar Trust of America will assume a major role in the development and construction of solar thermal power plants in the U.S. and build the first solar power plants of this size and capacity."

According to Uwe T. Schmidt, Chairman and Chief Executive Officer of STA, "The expansion of the previous activities around power plant construction opens up new sales potential. We offer our customers the entire range of services in the development, financing, technology, construction and operation of solar thermal power plants from a single provider. Adequate capitalisation should make it possible to simultaneously develop and realise several large projects with investment volumes of more than one billion US dollars each." To finance solar thermal power plants, the company might also turn to public grants and loan guarantees as well as to the possibilities of tax credits.

Josef Eichhammer, President and Chief Operating Officer of STA: "With our project development team at Solar Millennium LLC and our partners we have considerable experience in developing solar thermal power plants and have already concluded the first agreements for the realisation of such plants with a total capacity of up to 726 MW. Our new corporate structure will enhance our expertise and will position us well to achieve our growth targets. Overall, we will build on Solar Millennium‘s successes in Spain and with 250 MW - class plants we will set a further milestone in the development of innovative solar power plants."