Windy Point/Flats Wind Projects Continue Expansion
San Diego, CA – Renewable energy pioneer Cannon Power Group announced today that it has closed the financing for a 60-megawatt expansion of its landmark Windy Point/Windy Flats wind projects, which will increase the size of the combined projects to 400 megawatts.
Cannon closed the $178 million financing deal with Siemens Financial Services, Inc. allowing recapitalization of a portion of an existing credit facility and further expansion of the second phase of the project. This second phase, which will now total 262 megawatts, is scheduled for completion by the end of 2009. Most of the turbines used at Windy Point/Windy Flats are Siemens 2.3 megawatt turbines.“Besides increasing the size of our projects, we’ve also just completed the first leg of the projects’ second phase,” said Gary Hardke, president and managing director of Cannon Power Group. “This is another significant milestone for Cannon and our Windy Point/Windy Flats projects.” With this incremental expansion, the total investment in the Windy Point/Windy Flats projects will exceed over one billion dollars, Hardke indicated.Located on 26 contiguous miles of ridgeline along the Columbia River in Klickitat County, Washington, Windy Point/Windy Flats is one of the largest wind projects in the United States. When a planned third phase totaling 100 megawatts is complete, the entire project will generate 500 megawatts of wind power — enough clean electricity to power more than 250,000 households per year.”We are very pleased that Cannon Power Group has chosen Siemens again to supply wind turbines for its wind farm expansion project, adding to our already significant presence in the Pacific Northwest,” stated Jan Kjaersgaard, head of Siemens Energy’s Wind Power Americas business. “Windy Point/Windy Flats is now home to the largest number of Siemens turbines in the U.S.”More than half the power generated by Windy Point/Windy Flats will be purchased by the Southern California Public Power Authority (SCPPA), a joint powers agency comprising of eleven municipal utilities and one irrigation district. That wind energy will displace more than 400 metric tons of carbon dioxide annually – roughly one million driven miles.The agreement between Cannon and SCPPA gives the SCPPA the option to purchase the wind project after five years. As part of the transaction, SCPPA will be selling bonds to “pre-pay” a 20-year block of power.“Windy Flats is one of the most significant pre-pay power purchase agreement transactions concluded this year, with capital costs being covered in part by Treasury grant funding under the Stimulus Act and prepayment proceeds from SCPPA which will be used to take out construction financing,” said Tom Trimble, partner at Hunton and Williams, who represented Cannon in its negotiations with SCPPA. “With the addition of 60 megawatts at Windy Flats, that brings the total megawatts of the combined projects to 400 megawatts which is a tremendous achievement in only 18 months and in spite of the current financing environment,” Trimble said.The first 137 megawatt phase of Windy Point/Windy Flats was completed in May 2009 and sold in July 2009 for $385 million to the Tuolumne Wind Project Authority, a California joint powers agency formed by the Turlock Irrigation District and the Walnut Energy Center Authority.Since the projects began in mid-2008, more than 300 jobs have been created drawing mostly from within Klickitat County. Landowners will receive over $3 million annually in rent payments for use of their land to site the turbines. Local annual property taxes will also be increased by $3 million.In addition, Cannon structured the project to ensure no turbines would impact the viewshed of the Columbia Scenic Gorge Area.The project is also funding one of the largest habitat conservation programs in the Pacific Northwest, providing over $1 million for the preservation of sensitive wildlife habitat.
“One of the most important things we’ve learned developing renewable energy projects around the world is the importance of collaboration with local stakeholders, listening to the needs of a community and responding to them,” said Gerry Monkhouse, Cannon’s chairman. “Being a good corporate citizen is the foundation of a successful business model but, more importantly, it’s the right thing to do.”