NextEra Energy Partners LP (NEP) has signed agreements to acquire two renewable energy products from subsidiary companies.
NEP will acquire the 250 MW Palo Duro wind farm, which is currently under construction in Texas. The project is expected to begin commercial operation in the fourth quarter of this year. Palo Duro will sell all of its output under a 20-year power purchase agreement (PPA).
Furthermore, NEP will acquire the 20 MW Shafter solar project, which is included in the company's right-of-first-offer portfolio. Located in Kern County, Calif., the project is expected to begin construction in November, with commercial operation slated for the second quarter of 2015. Shafter will sell all of its output under a 20-year PPA.
NEP says it expects to acquire both projects in the first quarter of 2015 for total consideration of approximately $291 million, plus the assumption of approximately $250 million in tax equity financing, which is expected to close in December 2014 for Palo Duro, and subject to working capital adjustments. NEP plans to finance the acquisitions through cash on hand, cash retained from operations and the utilization its revolving credit facility.
‘There remains significant potential for new renewables development in North America, which could provide more opportunities for growth for NextEra Energy Partners over the long term,’ says Jim Robo, chairman and CEO of NEP.
