Electricity Generation

The Group operates a project development model in the electricity generation area. REACT Energy identifies suitable project sites and then advances projects through the planning and environmental permitting process as well as specifying the appropriate power technology.

The Group then sources the appropriate project finance through a mix of Senior Debt and Equity partners to facilitate the build out and commissioning of the project. REACT Energy’s typical target is to retain an equity stake of at least 50% in each project post development and commissioning. The Group targets individual project internal rate of returns in excess of 15%.

The project development model enables REACT Energy to make substantial returns on its initial investment in the early stage development costs and planning and permitting costs in projects.

The Group’s target is to generate a return in excess of 3 times its original investment in any individual project. The typical investment horizon from concept to construction ready/finance ready is 3 years.

The Group will continue to develop and exploit its existing wind portfolio on the island of Ireland to provide jurisdictional and technology diversification and take advantage of opportunity.

The Directors believe that long term Power Purchase Agreements (“PPA”) with Blue Chip counterparties and qualification for Renewable Obligation Certificates (“ROC’s”) add significant value to the Electricity Generation Business Model.

The Renewables Obligation (RO) is the primary support scheme for renewable electricity generation in the UK, and places an obligation on electricity suppliers to source an increasing proportion of their electricity from renewable sources. The Renewable Obligation Certificate (ROC) is a Certificate issued under the Renewables Obligation to an accredited electricity generator for eligible renewable electricity generated within the UK. The Renewables Obligation is underwritten by the UK Government.

Heat Generation

Biomass Heat Generation plants typically range from 150KW to 1MW thermal capacity. They use wood as a sustainable fuel source, and utilise proven, mature technology. The addressable market for the Biomass Heat only solution includes over 600 schools and universities, over 10,000 private hospitals and care homes, and over 5,000 country house hotels in the UK.

The Directors believe that long term Heat Supply Agreements (“HSA”) with Blue Chip counterparties and qualification for the Renewable Heat Incentive (“RHI”) add significant value to the Heat Generation Business Model.

The Renewable Heat Incentive (RHI) Provides financial assistance to producers of renewable heat and is underwritten by the UK Government.