Toronto, Ontario–(Newsfile Corp. – January 9th, 2023) – UGE International ltd. (TSXV: UGE) (OTCQB: UGEIF) (the “Company” or “UGE”), a leader in the commercial and community solar sector, announces milestones and business updates for the fourth quarter ending December 31, 2022.
2022 Backlog Goal Exceeded, Inflation Reduction Act Increases Backlog Value
In the fourth quarter, UGE’s project backlog (stages 3.1-5) increased over 13% quarter-over-quarter and now totals 260MW, surpassing the Company’s 2022 backlog goal of 250MW by a healthy margin. The Company’s pre-development pipeline (stages 1 and 2) now exceeds 2.3 gigawatts. During the quarter, UGE entered another state market – Ilinois – with a 6.5MW ground-mount community solar project in Ford County added to the backlog. Illinois’ community solar program, Illinois Shines, resumed accepting community solar projects to its adjustable incentive block program in November of 2022. Illinois will be a market of strategic focus for the Company in 2023, with several other projects in the state already nearing stage 3.1.
The Company has continued to update its financial assumptions based on the Q3 2022 passage of the Inflation Reduction Act (IRA), with all evidence indicating a meaningful increase in the value of the Company’s backlog. Although guidance is still being finalized, at present the Company expects over 50% of its backlog projects to be in ‘Energy Communities’ and 40% to be in low-income communities. Both designations can further increase the applicable Investment Tax Credit (ITC) by 10%, meaning that many of UGE’s projects should receive ITCs well in advance of the 30% baseline figure, with some potentially receiving up to a 50% ITC. The low-income communities adder has an annual cap, and it is unclear how that allocation will be made amongst eligible projects. UGE is also expecting domestic supply chains to expand in the coming years, putting the 10% domestic adder within reach, as well.
Projects totaling 18+ Megawatts Prepared for 2023 Construction
Two projects in Maine totaling 4MW received interconnection approval during the fourth quarter, and two projects in Maryland totaling 5.4MW were formally accepted into the state’s Community Solar Pilot Program. Site preparation and design have been completed for an additional three projects in Maine totaling 6.9MW and are awaiting interconnection approval. Two more projects in Maine – UGE’s first brownfield development and Maine’s largest rooftop solar project – will begin construction early this year.
Human Resources Added to Match Business Growth
To match the significant growth in business during the year, UGE added 36 new team members in 2022, increasing the size of the company by 37%. This growth occurred across all functions, from origination and development through deployment and asset management.
During the fourth quarter, UGE welcomed a fifth member to its executive team. Andrew Hines serves as UGE’s inaugural Chief Commercial Officer and will lead the Company in developing and connecting projects with off-takers interested in using cleaner, cheaper sources of electricity. Bringing 13 years of experience in the renewable energy sector, Andrew spent over a decade as the Co-Founder and CCO of CleanMax, Asia’s foremost provider of clean energy solutions for corporate customers, and is now based in Toronto.
Largest Private Placement Green Bond Closed, Round VI Retail Bond Now Available
As announced in its November 28, 2022 press release, the Company closed its largest private placement of green bonds during the quarter. With aggregate proceeds of C$7.37M, the offering was led by Canaccord Genuity Corp., on behalf of a syndicate of agents including iA Private Wealth Inc. and PI Financial Corp. Net proceeds from the offering will be for the development of UGE’s solar and energy storage projects.
UGE is pleased to announce that the rate of return for its series VI retail green bond has been increased from 8% to 9%, reflecting the current interest rate environment, and a new close date of February 24th, 2023 has been set. All other terms are unchanged.
UGE develops, owns, and operates commercial and community solar projects in the US and strategic markets abroad. Our distributed energy solutions deliver cheaper, cleaner energy to businesses and consumers with no upfront cost. With over 500MW of global experience, we work daily to power a more sustainable world.
Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond the control of the Company. Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Forward looking statements include, but are not limited to, the anticipated use of proceeds, and the listing of the Green Debentures on the TSX Venture Exchange. The Company assumes no obligation to update forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.