Project expected to provide approximately $23 million in annual cash available for
distribution
SAN FRANCISCO, April 26, 2017 /CNW/ -- Pattern Energy Group Inc.
(NASDAQ and TSX: PEGI) ("Pattern Energy") today announced it has
acquired interests in the two wind projects that comprise the 324
megawatt ("MW") Broadview Wind power facilities ("Broadview") and associated independent 35-mile
345 kV Western Interconnect transmission line ("Western
Interconnect") from Pattern Energy Group LP ("Pattern Development
1.0") for $269 million, consisting of
cash consideration of $215 million
and an assumed project loan of $54
million. Broadview, which
is located 30 miles north of Clovis, New
Mexico, commenced commercial operations in late March.
Highlights
- Broadview and Western
Interconnect have completed construction and commenced commercial
operation
- All of Pattern Energy's 18 wind power facilities are now fully
operational, with total operational owned capacity of 2,644 MW
- Pattern Energy acquired Broadview and Western Interconnect for
$269 million, which consisted of cash
consideration of $215 million and an
assumed project loan of $54 million
secured by Western Interconnect
- The cash consideration was funded from available corporate
liquidity
- Pattern Energy expects Broadview and Western Interconnect to generate
cash available for distribution ("CAFD") of approximately
$18 million in 2018, increasing each
year by approximately $2.5 million
per year generating an average of $23
million per year in CAFD over the five-year period starting
in 2018, which results in a CAFD multiple of 9.3x, after taking
into consideration the Western Interconnect loan
"This extraordinary project brings inexpensive renewable power
from eastern New Mexico, one of
the highest wind areas in the west, using dedicated transmission
capacity from several transmission systems into California. Broadview's production complements production
from California's domestic
renewable resources helping California transition to a carbon-free,
low-cost, renewable grid," said Mike
Garland, President and CEO of Pattern Energy. "We are
especially excited to bring this project on line because Pattern
Development is actively developing several significant
opportunities in New Mexico and
the southwest U.S. as part of the region's increasing demand for
low-cost, renewable energy. These new opportunities will be subject
to our ROFO as part of our relationship with Pattern
Development."
Pattern Energy has acquired from Pattern Development 1.0 an 84%
initial cash flow interest in Broadview and a 99% ownership interest in
Western Interconnect. Institutional equity investors have acquired
from Pattern Development 1.0 a 16% initial cash flow interest in,
and a 99% initial taxable income allocation from, Broadview. Following the acquisition, based on
its initial cash flow share, Pattern Energy retains an owned
interest of 272 MW in Broadview.
Pattern Energy's commitment to own and operate the facility was a
core component of securing high-quality institutional equity
investors for the project financing.
Pattern Energy acquired Broadview and Western Interconnect for
$269 million, including cash
consideration of $215 million and an
assumed project loan of $54 million
secured by Western Interconnect. The cash consideration was funded
from available corporate liquidity. The Western Interconnect loan
commitment was originally secured at the time of the agreement to
acquire Broadview in June 2016. The interest on the debt is 90%
swapped over the 19-year amortization term. The debt has a
maturity of 10 years.
Broadview will begin receiving
both pay-as-you-go ("PAYGO") contributions from Broadview's tax equity investors and certain
New Mexico production tax credits
starting in 2018. Based on the expected timing of these cash flows
and assuming normal wind conditions, Pattern Energy expects the
CAFD contribution, after deduction of Western Interconnect
financing costs, to be $18 million in
2018 and to increase approximately $2.5
million per year thereafter through 2022. This results in a
five-year average CAFD of $23
million per year and a 9.3x CAFD multiple, based on the cash
consideration of $215 million paid to
acquire Broadview and Western
Interconnect.
Broadview consists of 141
Siemens 2.3 MW wind turbines and has the capacity to generate 324
MW of energy, the power equivalent to the annual energy usage of
approximately 180,000 California
homes. Broadview is limited to 297
MW of injection capacity at Broadview's transmission interconnection
point.
Broadview has entered into two
20-year power purchase agreements ("PPAs") with Southern California
Edison ("SCE"), which has a BBB+/A2 credit rating, for sale of 100
percent of the output, up to a total of 297 MW, which has been
factored into Broadview's
economics.
Broadview interconnects to the
Western Interconnect transmission project, a 345 kV transmission
line, approximately 35 miles in length. To wheel the output from
Broadview to the California
Independent System Operator system where it is delivered to SCE,
Broadview has entered into
long-term, firm, point-to-point transmission service agreements to
move the output through the Western Interconnect, Public Service of
New Mexico and Arizona Public
Service transmission systems.
About Pattern Energy
Pattern Energy Group Inc.
(Pattern Energy) is an independent power company listed on The
NASDAQ Global Select Market and Toronto Stock Exchange. Pattern
Energy has a portfolio of 18 wind power facilities with a total
owned interest of 2,644 MW in the United
States, Canada and
Chile that use proven,
best-in-class technology. Pattern Energy's wind power facilities
generate stable long-term cash flows in attractive markets and
provide a solid foundation for the continued growth of the
business. For more information, visit www.patternenergy.com.
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements contained in this press
release constitute "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995 and
"forward-looking information" within the meaning of Canadian
securities laws, including statements regarding the annual CAFD
generated by Broadview, the CAFD
multiple of Broadview, the new
opportunities Pattern Development is developing in New Mexico and the southwest U.S., the
generation capacity of Broadview,
and power equivalent annual energy usage of California homes such capacity represents.
These forward-looking statements represent Pattern Energy's
expectations or beliefs concerning future events, and it is
possible that the results described in this press release will not
be achieved. These forward-looking statements are subject to risks,
uncertainties and other factors, many of which are outside of
Pattern Energy's control, which could cause actual results to
differ materially from the results discussed in the forward-looking
statements.
Any forward-looking statement speaks only as of the date on
which it is made, and, except as required by law, Pattern Energy
does not undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise. New factors emerge from time to time,
and it is not possible for Pattern Energy to predict all such
factors. When considering these forward-looking statements, you
should keep in mind the risk factors and other cautionary
statements in Pattern Energy's annual report on Form 10-K and any
quarterly reports on Form 10-Q. The risk factors and other factors
noted therein could cause actual events or Pattern Energy's actual
results to differ materially from those contained in any
forward-looking statement.
These forward-looking measures of annual CAFD, CAFD multiple,
anticipated 2018 CAFD and five-year average CAFD run rate are
non-GAAP measures that cannot be reconciled to net cash provided by
operating activities as the most directly comparable GAAP financial
measure without unreasonable effort primarily because of the
uncertainties involved in estimating forward looking changes in
working capital balances which are added to earnings to arrive at
cash provided by operations and subtracted therefrom to arrive at
CAFD.
Contacts:
Media
Relations
Matt
Dallas
917-363-1333
matt.dallas@patternenergy.com
|
Investor
Relations
Ross
Marshall
416-526-1563
ross.marshall@loderockadvisors.com
|
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visit:http://www.prnewswire.com/news-releases/pattern-energy-acquires-324-mw-broadview-wind-in-new-mexico-as-it-begins-operations-300446709.html
SOURCE Pattern Energy Group Inc.