Wind farm can shelter up to €150,000
For the second successive year, the Limerick-based firm HLB McKeogh Gallagher Ryan is advising the promoters of the Tullabrack Windfarm, in County Clare, on its EIIS private placing investment opportunity.
It will appeal to higher-rate taxpayers seeking a vehicle to efficiently shelter a portion of their taxable income using EIIS relief.
Under tax legislation, funds are required to be committed for a minimum of four years after the shares are issued, but this period can be longer at the discretion of the company.
In this instance, the Tullabrack investment is for a five-year period as it gives the company sufficient time to build up the cash reserves to buy out the EIIS investors.
Ireland has a target of generating 40 per cent of electricity consumption from renewable resources by 2020, the majority of which will be generated by onshore wind.
Not surprisingly, wind energy generation continues to be well-supported by lending institutions in Ireland.
Completed wind farms continue to be sold at strong prices.
The EIIS funds will be used to part-fund the construction of the 13.8-megawatt wind farm at Tullabrack, a townland close to Kilrush, at a projected cost of around €20 million.
The projected date for commissioning of the wind turbines is mid 2016. The main civil works are complete, only the erection of the turbines remains to be done.
All leases for site and connection routes are finalised and the grid connection process is at an advanced stage. The wind survey report is by leading consultants Garrad Hassan and Partners, while the power purchase agreement is finalised.
The promoters are wind sector experts with a strong business track record and more than 15 years’ experience in the sector.
They have successfully raised EIIS and BES funds in the past. They have indicated that the financial viability of this project is stronger than average – as evidenced by relatively low grid connection costs and optimal site conditions – which should maximise wind yields.
One of the promoters has successfully exited a previous BES investment at the full cap.
The first-round private placing was oversubscribed and this year the 2015 second- round private placing has a closing date of 30 November, as the promoters expect it to be fully subscribed.
This article appeared in the print issue of the Sunday Business Post on 22 November 2015.