SunPower Signs Definitive Sale Agreement for Italian Power Plants

Etrion Acquires 28-Megawatt Montalto di Castro Solar Park

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Aug 09, 2010, 03:05 ET

ROME, Aug. 9 /PRNewswire-FirstCall/ -- SunPower Corp. (Nasdaq: SPWRA, SPWRB) today announced that Etrion Corporation (TSX: ETX), an independent solar power producer, has signed a euro 48 million definitive sale and purchase agreement to acquire the equity in the first two phases of the Montalto di Castro solar photovoltaic (PV) power park, the largest in Italy.

The acquisition of the 20-megawatt (MW) first phase of the project for euro 36 million has been completed. The acquisition of the 8 MW second phase for euro 12 million remains subject to standard closing conditions and is expected to close by the end of the third quarter, 2010. SunPower will recognize the sale of the first phase of the project as a return of capital, and will recognize revenue on the sale of the second phase, including previously deferred EPC revenue, upon close of sale, which is expected by the end of the third quarter, 2010.

SunPower designed and built the 28 MW power plant in the Lazio region of Italy near Rome, and will provide ongoing operations and maintenance services. The first 20 MW were connected to the grid in November 2009, several weeks ahead of schedule. The 8 MW second phase was commissioned this month. An incremental 44 MW is planned to be completed and sold by the end of this year, bringing the total to 72 MW. The Montalto solar park's first and second phases are rated at 28 MW on an AC basis and 33 MW on a DC basis.

"The successful sale of the first phases of the Montalto solar park is an important milestone for SunPower," said SunPower President Howard Wenger. "The sale demonstrates our progress monetizing SunPower's European power plant pipeline of more than 1,200 MW that we acquired with the purchase of SunRay Energy in March 2010, and it helps validate our model of building and selling first-class solar power parks. Our expanding utility and power plant business provides us with strong revenue visibility in Europe, the Middle East and North America through 2014."

"Successful closure of this transaction is a tribute to the professional skills of our project sales team," said Yoram Amiga, CEO of SunRay Energy, a SunPower company. "Financiers recognize SunPower's superior quality, reliability and performance as we serve local communities with clean, renewable power. We intend to complete construction of an incremental 280 MW of Italian power plants by the end of 2011."

The Montalto di Castro park uses high-efficiency SunPower solar panels, the most efficient panels commercially available, installed on a SunPower® Tracker system. The Tracker follows the sun during the day and delivers up to 25 percent more energy than fixed-tilt systems, while significantly reducing land use requirements.

Worldwide, SunPower has more than 600 megawatts of solar power systems installed or under contract, including more than 225 megawatts of operational power plants in Europe.

About SunPower

Founded in 1985, SunPower Corp. (Nasdaq: SPWRA, SPWRB) designs, manufactures and delivers the planet's most powerful solar technology broadly available today. Residential, business, government and utility customers rely on the company's experience and proven results to maximize return on investment. With headquarters in San Jose, Calif., SunPower has offices in North America, Europe, Australia and Asia. For more information, visit www.sunpowercorp.com.

Editors' Note:

The capacity of power plants in this release is described in approximate megawatts on an alternating current (AC) basis unless otherwise noted. On a direct current (DC) basis, the first two phases of the Montalto di Castro solar park are approximately 24 MW and 9 MW respectively in capacity. They form part of a multi-phase solar park totaling approximately 85 MW (DC) in capacity.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that do not represent historical facts and may be based on underlying assumptions. The company uses words and phrases such as "will," "expects," "planned," "demonstrates," "provides," "intend," "pipeline" and "validates" to identify forward-looking statements in this press release, including forward-looking statements regarding: (a) expected closing of the acquisition of the 8 MW phase of the Montalto power plant; (b) timing and nature of revenue recognition; (c) construction and sales schedule for an additional 44 MWs in the Montalto solar park; (d) progress in monetizing solar power plant pipeline; (e) validation of model of building and selling solar power parks; (f) revenue visibility through 2014; (g) investor interest in the acquisition and financing of solar power parks; and (h) construction schedule for additional 280 MW Italian power plants. Such forward-looking statements are based on information available to the company as of the date of this release and involve a number of risks and uncertainties, some beyond the company's control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including risks and uncertainties such as: (i) construction difficulties or potential delays in the project implementation process; (ii) unanticipated delays or difficulties securing necessary permits, licenses or other governmental approvals or financing; (iii) the risk of continuation of supply of products and components from suppliers; (iv) unanticipated problems with deploying the system on the sites; (v) general business and economic conditions, including seasonality of the industry; (vi) growth trends in the solar power industry; (vii) the continuation of governmental and related economic incentives promoting the use of solar power; (viii) the improved availability of third-party financing arrangements; (ix) the significant investment required to construct power plants and the company's ability to sell or otherwise monetize solar power plants; and (x) other risks described in the company's Annual Report on Form 10-K for the year ended January 3, 2010, and other filings with the Securities and Exchange Commission. These forward-looking statements should not be relied upon as representing the company's views as of any subsequent date, and the company is under no obligation to, and expressly disclaims any responsibility to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.