The deal allows SkyPower to tap into HSH Nordbank's extensive financing experience and expertise, says CEO Kerry Adler. "Given the rapid pace at which the Canadian utilities are adopting wind energy into their generation mix, having a strategic partner like HSHN was viewed by SkyPower as critical to the execution of the company's distinctive business strategy."
SkyPower has no installed capacity, but boasts a pipeline of 24 wind and four solar projects in Canada with a total capacity of more than 7000 MW. Its most high profile wind power development is the 201 MW Terrawinds project in Quebec's Rivière-du-Loup region, which has a 21 year power purchase agreement with Hydro-Quebec Production. But the project has experienced a bumpy ride in getting the vital local zoning approvals needed to proceed.
In fact, in mid-July, SkyPower announced it had ceased work on Terrawinds because the municipality would not modify its interim control regulations for wind development, adopted in February, to provide the necessary setbacks and variances to allow the company to construct the park "in a timely and economically viable fashion." But by the end of the month, after a meeting with local and provincial government officials held at the request of Quebec Natural Resources Minister Pierre Corbeil, the project was back on again. At that meeting, the parties agreed to work together to forge an agreement on turbine placement.
Shortly after, the company announced its project development subsidiary, Terrawinds Resources, had obtained initial debt financing of C$26 million from HSH Nordbank to fund payments due in 2006 under its wind turbine supply agreement with GE Energy. It also entered into a non-binding term sheet with HSH Nordbank for debt financing of up to C$300 million to fund the balance of the construction costs and repay the turbine supply loan.