United States

United States

AEP to acquire 724MW US wind portfolio

American Electric Power (AEP) has agreed to acquire US developer Sempra Renewables and its 724MW portfolio of operational wind and battery assets.

The portfolio includes the 100MW Apple Blossom wind farm (above) in Michigan
The portfolio includes the 100MW Apple Blossom wind farm (above) in Michigan

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Sempra Renewables is a subsidiary of Sempra Energy, and jointly owns all or part of seven wind farms and one battery storage project in seven US states.

It has approximately 1GW of development projects, including some ‘safe harbour’ equipment — meaning the projects are deemed to have started construction and so are eligible for support under the US’s production tax credit (PTC) scheme — according to AEP.

AEP will acquire the portfolio for approximately $1.056 billion, it stated, including $551 million in cash, assumption of $343 million in existing project debt and $162 million in tax equity obligation.

It expects to close the transaction in the second quarter of 2019, subject to regulatory approvals.

AEP chairman Nicholas Akins said the investment would achieve a "significant portion" of its goal of $2.2 billion of capital investment in renewable energy by 2023.

The utility added with the acquisition of Sempra Renewables’ portfolio and a recent, separate agreement to purchase a 75% stake in the 300MW Santa Rita project (net 227MW) in Texas, its operational wind power portfolio will grow to a net capacity of 1,302MW.

AEP had announced plans in February 2018 to add nearly 5.3GW of wind capacity to its portfolio by 2030.

The utility expects to fall short of this target, however, forecasting 4.45GW of operational wind capacity by this date.

Its efforts to meet this target suffered a setback when the utility scrapped plans to build the 2GW Wind Catcher site after Texas’ Public Utility Commission rejected it in July 2018.

The operational wind portfolio to be acquired from Sempra Renewables features:

  • The 124MW Cedar Creek II project in Colorado, jointly owned with BP Wind Energy;
  • The 11MW Auwahi project in Hawaii, jointly owned with BP, as well as 6MW battery storage project at Auwahi;
  • The 100MW Fowler Ridge II project in Indiana, jointly owned with BP Wind Energy;
  • The 235MW Flat Ridge II project in Kansas, jointly owned with BP Wind Energy;
  • The 78MW Black Oak Getty project in Michigan, 100% owned;
  • The 100MW Apple Blossom project in Minnesota, 100% owned;
  • The 70MW Mehoopany project in Pennsylvania, jointly owned with BP Wind Energy.

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