Pattern Energy Group Inc. announced it will acquire interests in the 324-MW Broadview wind-power facility and associated independent 35-mile, 345-kV Western Interconnect transmission line from Pattern Energy Group for $269 million at commencement of commercial operations. Pattern Development has closed financing and is beginning construction on Broadview, which is located 30 miles north of Clovis, New Mexico.
Pattern Energy expects Broadview to generate cash available for distribution of approximately $28 million per year based on a five-year average run rate, before financing costs, which results in a pre-financing CAFD multiple of 9.6x for Pattern Energy’s owned capacity.
Pattern Energy has committed to acquiring an 84% initial cash flow interest in Broadview fromrom Pattern Development, and a 99% ownership interest in the Western Interconnect transmission line (for a total cash purchase price of $269 million), which will be funded at the commencement of commercial operations in less than a year.
Institutional equity investors have committed to acquire a 16% initial cash flow interest in, and a 99% initial taxable income allocation from, Broadview, which will also be funded following the commencement of commercial operations. Following the acquisition, and based on its initial cash flow share, Pattern Energy will retain 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 will fund the cash purchase price for its interest in the project, including the associated transmission line, at the commencement of commercial operations in less than a year with currently available corporate liquidity and up to $160 million of long-term project holding company debt financing commitments.
The Broadview power facility will consist 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 will be limited to 297 MW of injection capacity at the project’s transmission interconnection point.
Broadview has entered into two 20-year power purchase agreements with Southern California Edison, which has a BBB+/A2 credit rating, for sale of 100% of its output, up to a total of 297 MW, which has been factored into the project’s economics.
Broadview will interconnect to the new, privately-developed Western Interconnect transmission project, which will deliver the output to the California Independent System Operator. Western Interconnect is a 345-kV transmission line, approximately 35 miles in length, which will be 99% owned and operated by Pattern Energy. The combined cash available for distribution from the project and transmission line, before any financing costs, is expected to be approximately $28 million annually based on a five-year average run rate.
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