Octopus Renewables Infrastructure Trust (ORIT) has signed a new five-year term loan facility worth £100 million.
The facility comprises equal commitments from existing investors Santander, National Australia Bank and Allied Irish Banks and is secured against ORIT’s UK onshore wind and solar assets.
ORIT is managed by Octopus Energy Generation, part of the Octopus Energy Group. It invests in renewable energy assets in Europe, Australia and the UK.
The new £100 million facility will be used to pay down a portion of the existing, more expensive revolving credit facility (RCF) debt, on which ORIT has drawn £151.2 million so far; the net proceeds from the new loan facility will reduce the amount drawn from the RCF to about £53 million.
The company secured an all-in hedged interest rate of 5.3% which will see a material decrease in costs from the existing RCF which has an all-in rate of about 6.5%.
ORIT is also in the process of extending the tenor of the RCF and reducing its commitment size from £270.8 million to decrease commitment fees and further reduce costs.
Chair of ORIT Phil Austin said: “This new facility demonstrates ORIT’s ongoing commitment to reducing overall debt costs, enabled by the attractive terms secured by the investment manager against the high level of fixed revenue from these UK assets. The Company continues to examine further measures it can take to reduce costs and drive value for shareholders.”
ORIT’s UK assets
According to the investment fund, its UK assets that the loan facility was secured against benefit from a high fixed revenue level.
In April last year, ORIT secured a power purchase agreement (PPA) with Sky UK for the Crossdykes wind farm in Scotland, which ORIT acquired 51% of in 2022. The PPA increased the percentage of ORIT’s forecast revenue, fixed over the two years to 31 December 2025, from 81% to 82% and the percentage of forecast revenue, index-linked over the 10 years to 31 December 2033, from 51% to 53%.
In October, ORIT completed the acquisition of a 42MW Irish solar plant near Dublin, which, along with four other operational solar power plants in the area acquired during 2024, brought ORIT’s solar complex to 241MW.
ORIT claims that its five-site solar complex is the largest in Ireland and will meet around 2.5% of the Irish national solar target of 8GW by 2030. The acquisitions were in part financed by an £87 million 20-year debt facility provided by Allied Irish Banks and La Banque Postale, the former of which has signed onto the latest loan facility.
