Arava Power's Project SUNRAY Begins Commercial Operation

Israeli Developer of Utility-Scale Photovoltaics Now Online with First U.S Project

HERTZELIYA, Israel and UVALDE, Texas, Sept. 10, 2024 /PRNewswire/ -- Israel based Arava Power announced today that SUNRAY, a solar photovoltaic project with an installed capacity of 270 megawatts, has officially started its commercial operation in Uvalde County, Texas.

The project marks Arava's first foray into the U.S., which was developed with Israel's leading oil and gas retailer Paz Group and funded in partnership with Israeli insurance company Menora Mivtachim at a total cost of $330 million.

Project SUNRAY spans an area of approximately 1,200 acres and is leased for a cumulative period of 50 years. It includes over 500,000 solar panels and is expected to produce 515 gigawatt-hours of electricity per year. The result will prevent the emission of 225,000 metric tons of carbon dioxide and provide clean electricity to 43,000 homes in the San Antonio area each year. The SUNRAY project sells 50% of the generated electricity under a 12-year power purchase agreement, and the remaining half is sold on the merchant electricity market in Texas.

"Project SUNRAY is the result of great partners and collaboration with tremendous institutions from the United States, Israel and globally. For Arava Power Company, this isn't just about breaking new ground in the United States —it's about demonstrating the power of our platform from development through asset management over our history and across geographies," said David Rosenblatt, Co-Founder of Arava Power. "Arava Power's first project in the United States is a testament to our commitment to quality work and represents the growth we are undertaking." Rosenblatt co-founded Arava Power in 2008 with Ed Hofland.

Arava Power and Paz Group began developing the SUNRAY project in 2021, after acquiring it from OCI Energy. They completed financial closing in 2023 and as of last month, finished the construction work and received approval for commercial operation.

"We succeeded in developing our first U.S. project under extremely challenging market conditions," added Ilan Zidkony, CEO of Arava Power "Over the past few years, our team had to contend with regulatory upheavals, an almost unprecedented inflationary environment, and a complex financing landscape. Our company is proud of this achievement and are grateful for the confidence of top-tier partners and financiers. The commercial operation of SUNRAY is a key milestone in Arava Power's U.S. vision, with a portfolio of projects in various stages of development totaling 1.3 gigawatts across the U.S."

The project raised $215 million in construction financing fully underwritten by Nomura Securities International, Inc. ("Nomura") and $70 million in senior debt, provided by a consortium led by Nomura and including Bank Ha'poalim and BHI (the U.S. arm of Ha'poalim). Morgan Stanley serves as the Tax Equity partner in the project and together with an additional investor made an investment of approximately $150 million.

"Nomura is pleased to support Arava and Paz Group as they enter the US market and assist in working towards achieving a carbon-free grid," said Vinod Mukani, Global Head of Nomura Infrastructure and Power Business ("IPB"). "Enabling capital formation for these infrastructure assets, along with supporting developers like Arava and Paz Group through multiple parts of the transaction lifecycle from inception to term conversion, is a core part of Nomura's strategy. We are excited to see this project move forward."

Alain Halimi, Managing Director, Nomura's IPB commented, "Nomura is pleased once again to support Arava Power, Paz and Menora for the swift construction and term conversion of the SUNRAY project in Texas. We are privileged to play a leadership role in this important and groundbreaking financing for the project."

For more information, and to connect with an Arava executive to discuss this project, please contact us at [email protected].

About Arava Power
Founded in 2008 and headquartered in Hertzeliya, Israel, Arava Power is a utility-scale renewables Developer-IPP that pioneered the Israeli utility-scale PV market. Arava Power built Ketura Sun, Israel's first commercial solar field in 2011. The company's expertise and years of experience have allowed it to build one of the most profitable portfolios in the industry, maintaining and improving performance through excellence in development, technological innovation and advanced asset management operations. Today, Arava Power holds a multi-GW development portfolio in Israel and the U.S, across utility scale PV and BESS, Agrivoltaics and Distributed Energy Systems.

Additional Quotes from Israeli Partners:
Lior Mentzer, Director, Bank Ha'poalim: "Congratulations to Arava Power, Paz Group and Menora Mivtachim for launching a successful project in Texas and for their entry into the US market. Bank Ha'poalim considers this project to be an important step for our strategy in investing and financing green energy projects in the United States."

Nir Moroz, Deputy to the CEO and Director of Investments at Menorah Mivtachim: "Menora has been active for a long time in the world of green investments, and we continue to invest additional financial resources as part of the transition from traditional to renewable energy. Our involvement in SUNRAY further illustrates our strategy to invest in energy production, especially in the field of renewable energy."

SOURCE Arava Power