Cloudberry Annual report 2021 Financial statements 134 The total amount of contractual obligations related to the projects Hån wind farm and Skåråna, is EUR 32.5m and NOK 62m respectively, of which EUR 14m and NOK 57m is already invested and reflected in the table above. The obligation related to Ramsliåna and Tinnkraft is total investment of NOK 36m and NOK 36m respectively. The investments are expected to be financed with 50% debt from the existing debt facility in SpareBank 1 SR-Bank ASA. See note 24 Provisions, guarantees and contractual obligations. The carrying amount of an PPE asset comprises its purchase price or construction cost, any costs directly attributable to bringing the asset into operation, initial estimate of decommissioning obligation (asset retirement costs) and, if any, borrowing costs incurred in the construction period. Each significant component of an item is depreciated separately on a straight-line basis over the estimated useful life of the component. When determining the useful life, Cloudberry considers the useful life of the assets and the commissioning period given the power plant. Asset retirement obligation capitalised Provision for asset retirement costs have been made for Røyrmyra Wind farm. The timing is expected at the end of the concession period which also coincide with the expected useful life of the wind asset. The amount is included in the initial cost and is depreciated over the expected useful life on a straight-line basis. Asset retirement obligations have not been made for Cloudberry’s current hydro plants. The concessions for the hydro power plants do not have an expiry date, and the useful life of the equipment is estimated to be longer than the lease periods. It is currently assessed that because the power plants would continue to be revenue generating power producing plants, after the end of the lease periods, it is assumed that either the landowners (if the exercise their option to acquire the equipment), or the Company (which have the right to prolong the lease period if option to acquire the equipment is not exercised) will continue the use of the plants and therefore not decommission the equipment. The lease expiry dates are many years ahead (40-60 years) and the assessment will be updated over the useful life of the power plants and may change so that an asset retirement obligation will be made later, when material. Power plant assets are pledged as security for long term debt, see note 23. Projects under construction Hån wind farm The construction of Hån wind farm started on 2 August 2021. The construction work is on schedule and within budget. The project is located in Årjäng municipality, Sweden, and is planned with an installed capacity of 21 MW. The wind turbine consists of five Vestas V150 4.2 MW with a total height of 200 meters. They are expected to provide an annual production of 74 GWh. The power will be delivered to the Norwegian power grid (NO1, Oslo price area) at Marker transformer station. See also: https://www.cloudberry.no/sv/project/ han-vindpark
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