Foresight Solar Fund Limited Autumn Statement - Electricity Generator Levy (4244H)
November 24 2022 - 2:00AM
UK Regulatory
TIDMFSFL
RNS Number : 4244H
Foresight Solar Fund Limited
24 November 2022
24 November 2022
Foresight Solar Fund Limited ("Foresight Solar" or the
"Company")
Autumn Statement Update - Electricity Generator Levy
Foresight Solar Fund Limited, a fund investing in a diversified
portfolio of ground-based solar PV and battery storage assets in
the UK and internationally, announces the potential impact of the
Electricity Generator Levy relative to the Company's unaudited NAV
as of 30 September 2022 (GBP771.2 million, 126.4 pence per
share).
On 17 November 2022 the Chancellor of the Exchequer announced,
as part of the Autumn Statement, the introduction of a new Levy on
excess profits realised by UK electricity generators, the
Electricity Generator Levy. The Levy is proposed to take effect for
the period from 1 January 2023 until 31 March 2028 at a rate of 45%
of Exceptional Generation Receipts, which are calculated as revenue
from power sales above a benchmark price of GBP75/MWh. A GBP10
million per year allowance will apply, such that Exceptional
Generation Receipts below this threshold will be exempt.
The Company's UK solar assets are expected to fall within the
scope of the proposed Levy. The Company's UK battery storage assets
are not expected to fall within the scope of the proposed Levy. In
respect of the UK solar assets which are within scope, revenues
earned under Feed in Tariffs ('FiT'), Renewable Obligation
Certificates ('ROCs') or Contracts for Differences ('CfDs') will be
exempt from the proposed Levy.
The Directors have reviewed the details of the proposed
Electricity Generator Levy and assessed the potential impact the
Levy (ignoring any other potential adjustments) would have on the
Company's 30 September 2022 NAV.
The Company's NAV calculated as of 30 September 2022
incorporated discounts applied to the blended Q3 2022 power curves
for the period FY 2023 to FY 2027 inclusive, reflective of the
uncertainty surrounding the likely form of Government intervention
in the UK energy markets. In assessing the potential net impact of
the Electricity Generator Levy on the 30 September NAV, the Company
has:
1) Reversed the power curve discounts applied to the periods
FY2023-FY2027 (increasing the September NAV by 7.8 pence
per share); and,
2) Applied the proposed Levy on forecast UK solar generation
revenues (reducing the September NAV by 8.6 pence per
share).
The net impact of these changes alone would be to reduce the 30
September 2022 NAV by 0.8 pence per share.
The Autumn Statement provides greater clarity as to the
Government's approach to energy policy with regards to UK renewable
electricity generators. The Government has announced its intention
to publicise draft legislation for the proposed Electricity
Generator Levy in mid-December 2022. The Company will reflect the
expected impact of the Levy (along with any other appropriate
adjustments) in the 31 December 2022 NAV update.
For further information, please contact:
Foresight Group
Sophie Sutherland
(InstitutionalIR@ForesightGroup.eu)
Jefferies International Limited +44(0)20 7029 8000
Neil Winward
Gaudi Le Roux
Citigate Dewe Rogerson +44(0)20 7638 9571
Toby Moore
Lucy Gibbs
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END
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