Algonquin Power & Utilities Corp. (TSX: AQN) said Sept. 4 that it has an agreement to acquire the construction-stage, 200-MW Odell wind farm project in Minnesota.
The Odell project is located in Cottonwood, Jackson, Martin, and Watonwan counties in Minnesota and is being constructed on approximately 23,000 acres of land leased from a land owner group. The project will utilize proven turbine technology comprised of 100 Vestas V110-2.0 wind turbines and is scheduled to be commissioned in the fourth quarter of 2015.
Algonquin didn’t name the party it is buying this asset from. Geronimo Energy LLC is listed as the project backer in various regulatory filings for the Odell facility.
Odell has a 20-year power purchase agreement with a subsidiary of Xcel Energy (NYSE: XEL) and is estimated to generate 816.6 GW-hrs annually. Project construction costs are estimated to be approximately US$313.5m.
The Odell project qualifies for U.S. renewable energy production tax credits and it is expected that tax equity investors will provide approximately US$190.8m of equity financing toward project costs. The balance of the permanent financing will be arranged through Algonquin’s power generation subsidiary’s investment grade bond platform.
“There is significant demand for renewable energy in the U.S. and the investment in Odell is one of several near term opportunities that we see for accretive growth. The project further strengthens and diversifies our renewable energy generation portfolio with a 20 year power purchase agreement and a strong wind regime in a new geographic region,” said Algonquin Chief Executive Officer Ian Robertson.
Algonquin Power & Utilities owns and operates a diversified portfolio of regulated and non-regulated utilities in North America. The regulated utility business provides water, electricity and natural gas utility services to 485,000 customers through a portfolio of regulated generation, transmission and distribution utility systems. The non-regulated electric generation subsidiary owns or has interests in renewable energy and thermal energy facilities representing more than 1,100 MW of installed capacity.