Conditions Precedent Lifted in Power Purchase Agreement Between Landsvirkjun and PCC BakkiSilicon

REYKJAVIK, Iceland

Landsvirkjun, the National Power Company of Iceland, announced earlier this month that all conditions precedent have been lifted with regard to the power purchase agreement (PPA) signed last March by the company and PCC BakkiSilicon hf. (PCC). Landsvirkjun will thereby provide electricity to power a metallurgical grade silicon metal plant to be built by PCC in Bakki near Husavik on Iceland’s northeast coast.

Under the PPA, Landsvirkjun will provide electricity to power PCC’s plant, which is scheduled to commence operations in 2017 and will require 58 megawatts (MW) to produce up to 36 thousand tons of metallurgical grade silicon metal annually. The power will be derived entirely from renewable hydro and geothermal energy sources in Iceland.

All the conditions of the agreement have now been fulfilled including EFTA Surveillance Authority (ESA) approvals, issuance of permits, electricity transmission contracts and financing. PCC’s confirmed financing has also made guarantees enforceable. The PPA is now therefore fully valid and binding for both parties.

“The lifting of all conditions precedent pertaining to our PPA with PCC marks an important milestone in Landsvirkjun’s sales of power and confirms a new customer into our growing and more diverse customer base. Landsvirkjun has enjoyed close cooperation with PCC during the negotiation of the PPA and development of the project, and it is gratifying to now fully validate our agreement after a long process to get there.

“The PPA is important for the future development of industry in Bakki near Husavik. We strongly believe that silicon metal production has a bright future there where conditions are suitable for this type of operation and power is generated competitively from 100% renewable energy sources,” commented Dr. Hordur Arnarson, CEO of Landsvirkjun.

Landsvirkjun is one of Europe’s leading renewable energy companies and produces 73% of all electricity in Iceland. By signing this long-term PPA, Landsvirkjun continues to reaffirm the competitive business environment in Iceland. To learn more about renewable energy in Iceland, visit www.landsvirkjun.com.

About Landsvirkjun

Landsvirkjun is the National Power Company of Iceland and has generated renewable electricity from hydro, geothermal and onshore wind power sources for 50 years. Landsvirkjun is Iceland‘s largest generator of electricity, currently operating 16 renewable hydro and geothermal power stations. Landsvirkjun’s mission is to maximize value creation from energy sources entrusted to the company in a sustainable and efficient manner.

About PCC SE

PCC SE is a privately owned industrial holding and participation company based in Duisburg, Germany. The group operates in 17 countries with a total workforce of around 2,900 employees. The three main divisions – Chemicals, Logistics and Energy – generated a sales turnover of 648 million EUR for the fiscal year 2014. More about PCC SE on the internet www.pcc.eu

View source version on businesswire.com: http://www.businesswire.com/news/home/20150624005806/en/

Landsvirkjun
Magnus Thor Gylfason, +354 515 9000
Director Corporate Communications
magnusth@lv.is