In an era of big corporations, one developer has gone decidedly small. One turbine at a time, Foundation Windpower has crisscrossed California and installed over 22 MW’s worth of wind machines.
The company seeks out large businesses with high energy costs, such as a Safeway grocery distribution center in Tracy or a similar Walmart facility in Red Bluff. Foundation Windpower then applies its own algorithm to decide if a site is worth pursuing. If everything adds up, it offers a deal the customer can’t refuse: lower energy costs from a renewable product, at no upfront cost to the customer.
“We will not bid a project unless we can offer a discount to existing and projected utility rates,” says John Pimentel, president of the company. Using projected utility rates, and based on the wind resource at the site, Foundation Windpower estimates an average savings that can range from a few hundred thousand dollars to over $6 million for customers in a 20-year agreement.
The company’s algorithm considers multiple data points on wind speed, wind direction, and wind characteristics as well as the customer’s existing utility rate schedule and traditional power usage patterns. Once the situation is quantified, analyzed, and understood, it’s time to finalize a long term power purchase agreement which commits the customer to purchase the electricity generated by the wind turbine. Foundation Windpower then organizes everything from permitting to construction, and then operations and maintenance. The Menlo Park, Calif.-based company has completed 11 turbine installations and has two in the works. It uses GE and Mitsubishi turbines that range in size from 1- to 1.6-MW.
“It is a lot of work for a small company, but each of our teammates are sincerely committed to working in a company that makes the world a better place,” said Pimentel. Someday, the business is expected to generate modest and stable profits after repaying construction debt, senior debt, and tax equity investors who were necessary to deliver the project. “To the extent our efforts result in a small long term annuity stream for our families, this business will someday reach a second bottom line. Meanwhile, we keep overhead extremely low and our interests aligned with our customers and private investors,” Pimentel added.
One essential element of Foundation Windpower’s plan is the strong relationships it has cultivated with channel partners. Its lender, tax equity partner, and two turbine suppliers have extensive backgrounds in their respective industries. And the company’s construction partners altogether have built over 6,000 wind-turbine installations.
Foundation Windpower developed these relationships the old fashioned way, they earned them. “We told our partners what we were going to do, and then we did it. We built trust by spending time with our partners and always shooting straight with them,” said Pimentel.
To demonstrate their commitment, the co-founders of Foundation Windpower, Pimentel and CEO Matt Wilson, proffered personal guarantees to their lenders and tax equity partners totaling some $60 million. “Our partners understood these personal guarantees would keep our team highly focused on executing these projects and repaying or debts,” said Pimentel.
Filed Under: Projects