DNV provided due diligence to infrastructure investor Actis to identify and evaluate possible technical and related commercial risks for a portfolio of wind assets being developed by HERGO Japan Energy.
DNV, the global independent energy expert and assurance provider, has advised Actis GP LLP, a leading global sustainable infrastructure investor, on the inaugural acquisition of their new Japan-focused renewables infrastructure fund.
Actis has since acquired HERGO Japan Energy’s wider renewables portfolio as the acquirer’s first investment and seed asset for Nozomi Energy, a new USD 500 million Japan-focused renewables investment platform launched in May 2023 by Actis.
The focus of DNV’s due diligence approach for Actis was to identify possible technical and related commercial risks that may result in a power generation project being unable to return the expected revenue over its operational lifetime.
DNV’s cross-regional project team worked closely with Actis on qualitative and quantitative assessments of the technical risk. DNV assessed the impact of any issues identified from the site visit and project documents and provided recommendations to Actis to mitigate the associated risks. DNV also provided an independent energy production assessment for the two HERGO Japan onshore wind farms based on measurement data from on-site meteorological mast and vertical LiDARs.
”Actis has a strong, long standing relationship with DNV and has deep respect for the diligent, fact based approach taken to Energy Yield Assessments. It was very positive to have access to that capability, combined with deep local insight, as we enter a relatively new market for Actis,” said Liam Smith, Director, Energy Operations, Actis.
Assessing wind resources
DNV applied its worldwide reference methodology to determine the energy potential of the sites for Actis to base its investment decision and identify associated technical risks. The approach is tailored to each site as projects are dependent on the type of wind data available for analysis, and on the required accuracy – high, standard, or low uncertainty – of the assessment.
The accuracy required shaped the choice of analytical tools and approaches for wind data gathering, long-term assessment, vertical extrapolation, flow modelling, and assessing aerodynamic interactions and energy loss factors.
“We were delighted to be asked to provide due diligence to Actis before the launch of its ambitious Nozomi Energy plans that can help Japan capitalise on the country’s huge potential to use onshore and offshore wind power to supports its energy transition,” said Brice Le Gallo, Vice President and Regional Director APAC, Energy Systems at DNV. “The work for Actis is another example of how our energy experts in Japan and worldwide can collaborate to share our longstanding and wide experience to assist the further development of renewable energy projects in Japan.”
“It was our great pleasure to support Actis in this strategic investment with our technical due diligence services. We were proud to complete the assessments in a very challenging time frame while ensuring DNV’s quality standard for the services. We are eager to support Japan’s achievement of the net zero emission target by 2050 through our involvement in more transactions like this,” added Yukinobu Uchida, Market Area Manager Renewables, Japan, Energy Systems at DNV.