NRG Yield approved for buy of California wind farm interests

The Federal Energy Regulatory Commission on Aug. 11 approved the purchase by NRG Yield (NYSE: NYLD), the new “yieldco” affiliate of NRG Energy (NYSE: NRG), of power plant interests now held by subsidiaries of Terra-Gen Power LLC.

On June 10, NRG Yield and NRG Yield Operating LLC, together with project companies Alta Wind I LLC, Alta Wind II LLC, Alta Wind III LLC, Alta Wind IV LLC, Alta Wind V LLC, Alta Wind X LLC, and Alta Wind XI LLC, filed a joint application. They asked for authorization of the indirect acquisition of 100% of the membership interests in the project companies by NRG Yield and NRG Yield Operating.

Terra-Gen is a renewable energy company focused on developing, owning, and operating utility-scale wind, geothermal, and solar generation. Terra-Gen owns about 1,960 MW of renewable generating facilities across six states and 37 projects. Terra-Gen is owned by private equity investment funds managed by ArcLight Capital Partner LLC, which own 61% of Terra-Gen, and Global Infrastructure Management LLC, which owns the remaining 39%.

The Terra-Gen-controlled sellers – TG Finance, NTC AWAM Holdings LLC, CHIPS Alta Wind X and CHIPS Alta Wind XI – will no longer hold any ownership interests in the project companies following the proposed transaction.

Alta Wind I-V and X-XI own and operate 947 MW of wind capacity at the Alta Wind Energy Center at the Tehachapi Pass in California. The entire output of the facilities owned by Alta Wind I-V is committed to Southern California Edison under long-term contracts, with remaining terms in excess of 20 years. Beginning on or before Jan. 1, 2016, the entire output of the generation facilities owned by Alta Wind X and XI will also be committed to Southern California Edison under long-term contracts.

NRG Yield announced in June that it had agreed to acquire the Alta Wind complex in California from Terra-Gen Power for $870m plus the assumption of $1.6bn of non-recourse project financings and subject to customary working capital adjustments.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.