Greencoat Renewables inks 10-year PPA with Keppel DC REIT

(Sharecast News) - Greencoat Renewables announced the signing of a new 10-year power purchase agreement (PPA) with Keppel DC REIT on Thursday, for 100% of the electricity generated at its Ballincollig wind farm, which produces 31.5 GWh of renewable energy annually. The AIM-traded firm said the agreement, which would provide escalating revenues through to 2036, formed part of its broader re-contracting strategy aimed at enhancing cash flow stability as assets exit regulated tariff regimes.

It marked the second PPA Greencoat had signed with Keppel DC REIT, and came ahead of Ballincollig's transition from its current tariff arrangement next month.

The deal would support Keppel's renewable energy sourcing for its data centre operations.

Since initiating its re-contracting strategy in December 2023, Greencoat said it had executed six PPAs covering over 540 GWh of annual output, or roughly 20% of its five-year merchant energy forecast.

The agreements had an average duration of more than eight years, and would involve a diverse set of international counterparties, including major players in AI and heavy industry.

Greencoat said it expected to continue expanding its PPA portfolio as demand for clean energy remained strong across sectors.

"This agreement is a clear demonstration of our ability to execute our re-contracting strategy, securing long-term cash flows and supporting asset value," said Paul O'Donnell, partner at Schroders Greencoat LLP.

"This agreement also further strengthens our position as a trusted partner to leading power buyers, supporting their decarbonization efforts and advancing the energy transition.

"As one of Europe's leading listed owners and operators of renewable energy infrastructure assets, we see significant opportunity in the accelerating energy demand driven by data centre growth and the broader AI-led digital economy."

O'Donnell said data centres powered by renewable energy would be a "key industrial enabler" for the next phase of economic development.

"Greencoat Renewables is strategically positioned to deliver cost-effective, clean power - supporting the ambitions of our partners and contributing to sustainable economic growth."

At 1141 BST, shares in Greencoat Renewables were up 2.78% at 0.74p.

Reporting by Josh White for Sharecast.com.