Octopus Renewables Infrastructure Trust (ORIT) has inked a significant Power Purchase Agreement (PPA) with Sky UK, marking a pivotal milestone for the Crossdykes wind farm nestled in Lanarkshire, Scotland, as it advances towards sustainable energy collaboration.
Under the terms of the agreement, Sky UK, a prominent media and telecoms corporation, will procure the majority of the electricity generated by the 46-megawatt (MW) array, solidifying its commitment to renewable energy procurement.
ORIT's acquisition of a 51% stake in Crossdykes in 2022, alongside Octopus Renewables Infrastructure SCSp, which acquired the remaining 49%, laid the groundwork for this landmark PPA. The agreement facilitates the sale of 69% of the wind farm's output to Sky at a CPI-linked fixed price over a decade-long period, set to commence in April 2025.
The deal promises to augment ORIT's revenue profile, increasing the percentage of forecasted fixed revenue over the next two years and index-linked revenue over the subsequent decade, enhancing financial stability and certainty for the portfolio.
Phil Austin, Chairman of ORIT, expressed satisfaction with the agreement, stating, “We are pleased to enter this agreement with Sky, which is a UK household name and a strong partner as part of the Nasdaq-listed Comcast Corporation.” Austin underscored the strategic significance of the PPA in bolstering ORIT's revenue stability and aligning with its long-term investment strategy.
Renewable energy supply agreements with industry leaders like Sky are pivotal in driving collective efforts to decarbonize businesses and advance sustainability goals, Austin emphasized. The contract reflects the collaborative efforts of ORIT's Investment Manager's energy markets team in executing a strategy focused on delivering fixed revenue and inflation linkage, ensuring portfolio resilience and sustainability.
The Crossdykes wind farm, projected to generate approximately 144 gigawatt-hours (GWh) of electricity annually, holds promise in powering the equivalent of around 50,000 homes while mitigating around 50,000 tonnes of carbon dioxide emissions each year, equivalent to planting 250,000 trees.
