Capital Power secures long-term contract for its 99 megawatt New Frontier Wind project
EDMONTON, Alberta – Capital Power Corporation (Capital Power or the Company) (TSX: CPX) today announced that development of the New Frontier Wind project (New Frontier Wind) is proceeding immediately. New Frontier Wind is a 99 megawatt (MW) facility located in McHenry County, North Dakota. The Company is in the final stages of selecting a turbine supplier and the project cost is expected to be approximately $182 million (US$145 million). Commercial operation of the facility is expected to commence in December of 2018.
Capital Power will operate New Frontier Wind under a 12-year fixed price contract with an investment grade U.S. financial institution covering 87% of the facility’s output. Under the contract, which was executed on August 29, 2017, Capital Power will swap the market revenue from a fixed volume of New Frontier Wind’s generation for a fixed price payment over a 12-year term. The agreement will secure long-term predictable revenues, allowing New Frontier Wind to secure renewable energy tax equity financing and provide Capital Power the opportunity to complete its second wind development project in the growing U.S. renewables market.
“New Frontier Wind further advances our strategy of adding shareholder value by growing contracted cashflows by executing on the Company’s development activities,” said Brian Vaasjo, President and CEO Capital Power.
Forward-looking information or statements included in this press release are provided to inform the Company’s shareholders and potential investors about management’s assessment of Capital Power’s future plans and operations. This information may not be appropriate for other purposes. The forward-looking information in this press release is generally identified by words such as will, anticipate, believe, plan, intend, target, and expect or similar words that suggest future outcomes.
Material forward-looking information in this press release includes disclosures regarding: (i) expectations pertaining to the construction start and completion dates for New Frontier Wind (ii) expectations pertaining to the project costs for New Frontier Wind and (iii) expectations pertaining to the Company securing renewable energy tax equity financing for New Frontier Wind.
These statements are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate. The material factors and assumptions used to develop these forward-looking statements relate to: (i) electricity and other energy prices, (ii) anticipated facility performance, (iii) business prospects and opportunities including expected growth and capital projects, (iv) status of and impact of policy, legislation and regulations, and (v) effective tax rates.
Whether actual results, performance or achievements will conform to the Company’s expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results and experience to differ materially from the Company’s expectations. Such material risks and uncertainties are: (i) changes in electricity prices in markets in which the Company operates, (ii) changes in energy commodity market prices and use of derivatives, (iii) regulatory and political environments including changes to environmental, financial reporting, market structure and tax legislation, (iv) facility availability and performance including maintenance of equipment, (v) ability to fund current and future capital and working capital needs, (vi) acquisitions and developments including timing and costs of regulatory approvals and construction, (vii) changes in market prices and availability of fuel, and (viii) changes in general economic and competitive conditions. See Risks and Risk Management in the Company’s Management’s Discussion and Analysis for the year ended December 31, 2016, prepared as of February 17, 2017, for further discussion of these and other risks.
Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the specified approval date. The Company does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.
About Capital Power
Capital Power (TSX: CPX) is a growth-oriented North American power producer headquartered in Edmonton, Alberta. The company develops, acquires, operates and optimizes power generation from a variety of energy sources. Capital Power owns approximately 4,500 megawatts of power generation capacity at 24 facilities and is pursuing contracted generation capacity throughout North America.