JPM Capital to sell wind farm interests to Hannon Armstrong

JPM Capital Corp. (JPMCC) and HA Wind IV LLC applied Dec. 9 at the Federal Energy Regulatory Commission for authorization of a proposed transaction in which JPMCC will transfer its non-managing, direct or indirect, equity interests in six public utilities to one company (called “Newco”) to be owned jointly by JPMCC and HA Wind IV.

This new company will be an indirect, newly-formed subsidiary of JPMCC and Hannon Armstrong Sustainable Infrastructure Capital Inc. The six public utilities are FPL Energy Mower County LLC, FPL Energy Oliver Wind I LLC, FPL Energy Oliver Wind II LLC, Logan Wind Energy LLC, Peetz Table Wind Energy LLC and Peetz Logan Interconnect LLC (PL Interconnect). Each of these companies other than PL Interconnect is engaged in the generation of wind-powered energy. PL Interconnect is engaged in transmission of electric energy generated only by Logan and Table Wind.

The applicants asked the commission grant expedited review and approve this application by no later than Jan. 12, 2017.

JPMCC is an indirect, wholly-owned subsidiary of JPMorgan Chase & Co., an international financial services company.

HA Wind IV is part of Hannon Armstrong Capital LLC (HA Capital LLC). HA Capital LLC is a wholly owned subsidiary of Hannon Armstrong Sustainable Infrastructure LP (Hannon LP). Hannon LP is owned 99% by Hannon Armstrong, and 1% by various individuals and investment funds. Hannon Armstrong acts as general partner and majority limited partner in Hannon LP.

Hannon Armstrong holds indirect ownership interests in five public utilities (Oasis Power Partners LLC, Blue Canyon Windpower II LLC, High Trail Wind Farm LLC, Flat Rock Windpower LLC and Flat Rock Windpower II LLC), and also Madison Windpowe LLC, which is a QF, in addition to four wind-powered project companies located in the ERCOT region of Texas and not subject to the commission’s jurisdiction.

Additionally, Hannon Armstrong holds indirect ownership interests in three public utilities (Elk River Windfarm LLC, Shiloh I Wind Project LLC and Trimont Wind 1 LLC).

  • Elk River is an owner of a wind facility with a generating capacity of 150 MW (nameplate), located in Butler County, Kansas.
  • Shiloh I is an owner of a wind facility with a generating capacity of 150 MW (nameplate), located in Solano County, California.
  • Trimont is an owner of a wind facility with a capacity of 100.5 MW (nameplate), located in Jackson and Martin counties, Minnesota.

Also, Hannon Armstrong holds indirect ownership interests in Buckeye Wind Energy LLC, an owner of a wind facility with a generating capacity of 200.48 MW (nameplate), located near Ellis County, Kansas.

Plus, Hannon Armstrong holds indirect ownership interests in Gunsight Mountain Wind Energy LLC, an owner of a wind facility with a generating capacity of 120 MW (nameplate), located in the ERCOT region of Texas and not subject to the commission’s jurisdiction under Section 203 of the Federak Power Act.

Hannon Armstrong also holds indirect ownership interests in one small wind power production facility that is a QF. This 6.8 MW facility is located in Platte County, Nebraska. It is owned by Creston Ridge LLC.

Hannon Armstrong also holds indirect ownership interests in four small solar facilities, each certified as a QF, with an aggregate gross power production capacity of 4,242 kW. Three of these facilities are in Puerto Rico. The fourth facility is in Texas.

As for the facilities subject to this application:

  • Mower owns and operates a 98.9 MW wind facility located in Mower County, Minnesota, which is located in the MISO BAA. Mower is authorized by the commission to sell power at market-based rates. The output of the Mower facility is committed under long-term contract with a non-affiliate.
  • Oliver I owns and operates a 50.6 MW wind facility located in Oliver County, North Dakota, which is located in the MISO BAA. Oliver I is authorized by the commission to sell power at market-based rates. All of Oliver I’s capacity is fully committed pursuant to a long-term contract with a non-affiliate.
  • Oliver II owns and operates a 48 MW wind facility located in Oliver County, North Dakota, which is in the MISO BAA. Oliver II is authorized by the commission to sell power at market-based rates. All of Oliver II’s capacity is committed under long-term contract with a non-affiliate.
  • Logan owns and operates an approximately 201 MW wind facility located in Logan County, Colorado, in the Public Service Co. of Colorado (PSCO) region. Logan is authorized by the commission to sell power at market-based rates. All of Logan’s capacity is fully committed pursuant to a longterm contract with a non-affiliate.
  • Table Wind owns and operates a 200 MW wind facility located in Logan County, Colorado, and its Class A membership interests are indirectly wholly-owned by NextEra Energy. All power is transmitted over transmission facilities owned by its affiliate, PL Interconnect, to a substation owned by PSCO, and all power is sold to PSCO under a long-term contract. Table Wind is authorized by the commission to sell power at market-based rates.
  • PL Interconnect owns and operates an approximately 78.2 mile, 230 kV radial transmission line and related facilities located in northeastern Colorado that connect three affiliated wind generation projects to PSCO’s transmission system at the Pawnee substation.

Under this proposed transaction, JPMCC will transfer all of its direct interests in Northern Frontier Wind, and thereby its indirect interests in the project companies, to Newco. The project company interests all are passive, non-managing interests that do not provide JPMCC—and, consequently, will not provide Newco — with the right to control the project companies. Newco will be jointly owned by JPMCC and HA Wind IV, each of which will be co-managing members of Newco. JPMCC and HA Wind IV will, through Newco, have only those limited consent/veto rights with respect to the project companies under the interests that JPMCC currently holds.

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.