FERC okays transfer of wind project to NextEra Energy Partners

The Federal Energy Regulatory Commission on Dec. 30 approved the transfer by NextEra Energy (NYSE: NEE) of a nearly-completed wind project to its “yieldco” affiliate.

On Nov. 26, Palo Duro Wind Energy LLC (Palo Duro I) and Palo Duro Wind Interconnection Services LLC requested commission authorization for the indirect acquisition by NextEra Energy Operating Partners LP (OpCo) of 100% of the Class A Membership Interests in Palo Duro I from a wholly-owned subsidiary of NextEra Energy Resources LLC.

Each of the applicants is currently an indirect wholly-owned subsidiary of ESI Energy LLC. ESI Energy is a wholly-owned direct subsidiary of NextEra Energy Resources, which in turn is a wholly-owned indirect subsidiary of NextEra Energy.

Palo Duro I owns and operates a wind facility with an approximate 263 MW aggregate capacity located in Beaver County, Oklahoma, and Ochiltree and Hansford counties, Texas, within the Southwest Power Pool (SPP) market. The Palo Duro I Facility is interconnected with Oklahoma Gas & Electric (OGE) and is in the process of beginning commercial operation. PaloDuro I has entered into a long-term power sales agreement with Southwestern Public Service for 100% of the electric output of the Palo Duro I Facility.

Palo Duro Interconnection is owned by Palo Duro I and Palo Duro Wind Energy II LLC, another ESI Energy subsidiary that is developing a 36-MW wind facility near the Palo Duro I Facility. Palo Duro Interconnection owns interconnection facilities that serve or will serve the Palo Duro I and Palo Duro II facilities.

OpCo, the indirect acquirer of the Class A Membership Interests in Palo Duro I, indirectly owns about 990 MW of wind facilities in various geographic markets throughout the U.S. and Canada. The limited partnership interests in OpCo are owned by NextEra Energy Partners LP (NYSE: NEP) and by NextEra Energy Equity Partners LP. NextEra Energy Partners is a yieldco that has been structured to monetize the value of certain of NextEra Energy Resources’ wind and solar facilities. Approximately 17% of the limited partnership interests in NextEra Energy Partners are currently traded on the New York Stock Exchange. The remaining approximately 83% of the limited partnership interests in NextEra Energy Partners are currently held by NextEra Equity. NextEra Equity is an indirect wholly-owned subsidiary of NextEra Energy Resources.

Incidentally, FERC on Dec. 9 approved the sale by NextEra Energy Resources of Class B non-controlling interests in Palo Duro I and other wind projects to financial entities. 

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.