Pattern Energy Group has two wind projects in construction

Wind farm owner Pattern Energy Group said in an Aug. 5 quarterly financial report that in June, it acquired a 79% ownership interest in the 218-MW Panhandle 1 project in Texas from Pattern Development, following the completion of construction and commencement of commercial operations on June 25.

Also, the 182-MW Panhandle 2 project in Texas, where Pattern Energy Group holds a 147-MW stake, is in construction and due for commercial operation in the fourth quarter of this year.

In June, Pattern Energy Group increased its net ownership interest in the 115-MW El Arrayán project to 70% and its owned operating capacity by an additional 44 MW. The project was completed in early June and is now fully operational. Prior to the acquisition, Pattern Energy Group’s net ownership interest in the El Arrayán wind project was 31.5%.

The 149-MW Grand project in Ontario, where Pattern Energy Group owns a 67-MW stake, is also in construction and due for commercial operation in the last quarter of this year. The company said it has recently encountered potential cost increases and delays in the construction of Grand, and is in discussions with Samsung C&T Canada Ltd. (a subsidiary of Samsung C&T Corp.), the project construction provider, regarding this matter.

Pattern Energy Group an independent power company focused on owning and operating power projects with stable long-term cash flows in attractive markets with potential for continued growth of its business. It holds interests in eleven wind power projects located in the United States, Canada and Chile that use proven, best-in-class technology and have a total owned capacity of 1,472 MW, including the Panhandle 2 project, which it expects to acquire prior to the end of 2014.

These projects consist of nine operating projects and the two projects under construction that are both scheduled to commence commercial operations prior to the end of 2014. Each of the projects has contracted to sell all or a majority of its output pursuant to a long-term, fixed-price power sale agreement with a creditworthy counterparty.

Pattern Energy Group’s proportional MWh sold in the three months ended June 30, 2014, was 769,619 MWh, as compared to 496,763 proportional MWh sold in the three months ended June 30, 2013. This increase in proportional MWh sold during 2014 as compared to 2013 was primarily attributable to an increase in production at Ocotillo and Santa Isabel and also to the commencement of commercial operations at South Kent in March 2014.

The company’s average realized electricity price was approximately $95 per MWh in the three months ended June 30, 2014, as compared to approximately $85 per MWh in the three months ended June 30, 2013. The average realized electricity price in 2014 was higher than the comparable period in 2013 because the pricing terms under the South Kent and El Arrayán PPAs are each higher than the overall average realized price applicable in 2013.

“Wind conditions have improved at our project sites on average compared to recent quarters and, as a result, the electricity production at our fleet was close to its long-term average during the three months ended June 30, 2014,” the company noted. “Excluding our newly operational project, South Kent, the production was less than 2% below the expected long-term average during this period. South Kent experienced some startup issues that are common for new power projects which are being addressed by Siemens.”

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.