Polaris Infrastructure Announces Closing of Acquisition in the Dominican Republic

TORONTO, ON / ACCESSWIRE / June 28, 2022 / All amounts in USD unless otherwise stated) - Polaris Infrastructure Inc. (TSX:PIF) ("Polaris" or the "Company"), announced today that it has closed the previously announced acquisition of an operational solar project in the Dominican Republic.

The Dominican Republic - Solar

Polaris has completed the acquisition from a Canadian based renewable energy developer, Potentia Renewables Inc., a 32 MWdc operational solar project named Canoa 1 (the "Project") located in the Barahona Province, Dominican Republic. The Project reached COD in March 2020 and has a 20 year power purchase agreement ("PPA") in place with Edesur Dominicana SA (EDESUR), a local Dominican distributor.

The key terms and attributes of the acquisition are as follows:

• Polaris purchased all of the issued and outstanding common shares of Emerald Solar Energy SRL which owns 100% of the Project and the licenses and permits, in exchange for $20.3 million in cash, including closing adjustments;
• Polaris now owns 100% of the Project which includes the Canoa 2 expansion as described below;
• Polaris assumed non-recourse debt at the project level of $35.3 million;
• The Project has a PPA denominated in US$ with an estimated price for 2022 of $128.10 per Mwhr. Such PPA has an inflator of 1.22% per annum until the price reaches $142.80 per Mwhr at which point the price remains fixed until the end of the PPA in 2040.

The Project has an extendable 30-year lease agreement with the original developer and is located on a portion of a land parcel totalling ~1.4km2. The Canoa 1 project represents approximately 30% of the total land parcel. The definitive Concession allows for the capacity installed to be doubled from the current operating capacity of 32.6 MWdc to approximately 65 MWdc.

A second PPA for Canoa 2 with the local distributor would be required and these discussions are actively continuing. To the extent a PPA for Canoa 2 is reached, Polaris will look to commence construction shortly thereafter.

"We are very pleased to have closed on this acquisition" stated Marc Murnaghan, Chief Executive Officer of Polaris Infrastructure, "The combination of operational and development assets is the mix of assets we have been looking for and aligns with our strategic objectives. Now that the acquisition is closed, our jurisdictions will have increase to four and our plants in operation will increase to five with operational solar added to the generation mix. As well, we do expect to close on our previously announced Ecuadorian transaction in Q3-22. This is all aligned with the goal of diversification by asset class and generation mix while maintaining 100% of revenues derived in US dollars. In addition, we view the Dominican Republic as a very attractive market for Polaris to grow and develop further renewable projects."