Misae is Copenhagen Infrastructure Partners’ first large-scale solar investment, generating enough clean energy to power nearly 60,000 houses a year. It has served as a role model for even bigger investments in Texas and could pave the way for further projects elsewhere.
When Floran Küster first saw the Misea solar project in Texas, he couldn’t quite comprehend its size.
I only saw half the site and already felt it was enormous. But then we did the tour with the construction manager who was handpicked for the job, and I saw the other side. It just went on and on and on. Before I visited, I just couldn’t imagine the size of it
Misae, CIP’s first large-scale solar investment, is a 240 MW project located approximately six miles east of the city of Childress, Texas on 1,674 Acres of land equivalent of approx. 1200 football fields. It started commercial operations in the fourth quarter of 2019 and generates enough clean energy to power nearly 60,000 houses per year.
Texas is an ideal location because it has plentiful sunshine and land without inhabitants. When Küster visited, the site was too big to tour by foot. Instead, they rode in a truck, and it still took a couple of hours.
Misae, the smaller Sage development in Utah and the Mitchell portfolio in North Carolina are the first large-scale solar projects in Copenhagen Infrastructure Partners’ renewable energy portfolio. These projects are investments of the Copenhagen Infrastructure II (CI-II) and Copenhagen Infrastructure III (CI-III) funds.
As such, Misae is an important milestone demonstrating CIP’s capacity to originate, develop, structure and finance utility-scale energy infrastructure projects across multiple asset classes and technologies. The solar projects will provide long-term, stable, and predictable cash flows with an attractive risk/ return profile for investors and complement the existing portfolio of investments in onshore and offshore wind and other renewable technologies.
Construction of Misae, near Childress in northern Texas, started in 2018 and work progressed rapidly to enable production from 2019. To reduce the risk, the CI-III fund sold 49% of Misae to IKEA owner Ingka Group in 2020.
The project has entered into a power price hedge with a financial institution, one of the first of such hedges to be signed for a solar project and has secured third-party tax equity funding.
The sheer size of the development is just what we imagine from Texas, where everything is outsized. That includes our construction manager, a real character, a classic Texan, and very qualified for the job
We did the site tour in his huge truck, and he knew how to work with and identify with Texan people – something I could never have managed to do myself. He was doing 15 kilometres in walk-downs and was really committed to the job and the construction workers. In our business, you must be aware of and respect cultural differences and ensure you have different individuals who fit with the local community
One driving factor behind Misae was the realisation that while there was plenty of wind power in Texas, the state was not harnessing its abundant solar power. There is significant demand from air conditioning when the sun is shining, but then there is usually little wind, so there is a significant undersupply. That means a solar power development can benefit from significantly higher prices at peak demand.
Before the investment in Misae, CIP had first undertaken the Sage development in Utah and the Mitchell project in North Carolina, which were both smaller scale and provided plenty of experience that was applied in the bigger Misae, which used the same contractors.
As for Misae, the learnings keep coming. The pattern of higher prices when the sun is shining and there is no wind has been confirmed, but CIP needs to understand how that will develop over the longer term and with the advancement of technologies like batteries and hydrogen.
Based on what we have achieved at Misae, CIP has been able to take on two further large-scale solar projects in Texas, Greasewood and Fighting Jays. And on top of that, success in Texas opens up further market opportunities, like Canada and Australia, which have a similar market structure, overall resources and land availability
Across the world CIP is engaged in green energy and infrastructure projects. Here are a few of them.