Sequoia will use the money to advance further projects in development in Manitoba as well as neighbouring Saskatchewan and North Dakota. It also wants to expand to become a leading developer across the entire region.
CEO Ron Diduch says the company has a well-developed understanding of the wind resource within the huge area covered by the regional transmission company, the Midwest Independent System Operator (MISO), which includes Manitoba, Saskatchewan, and seven US states. "Just as the wind blows across borders, wind developers have to look beyond the lines on a map," he says. "The expansion to North Dakota and other US northern Midwest states is a natural action for Sequoia."
Good Energies, says managing director Jean-Louis Brenninkmeyer, looked at a number of investment opportunities in the Manitoba market and decided Sequoia, with its community-centred approach and potential for expansion on both sides of the international border, was the best fit with the ethical bias of his company's investment strategy (page 37).
Sequoia has ten projects in the MISO region at various stages of development with a total capacity of 1200 MW. One of the most advanced is a 150-200 MW wind farm in North Dakota, where Sequoia has been active for the last three years. It is in the final stages of interconnection design and environmental permitting. "We would like to see the project come on line in 2009," says Diduch.
Although a number of major US developers have begun exploring opportunities in Canada, Sequoia is at the forefront of Canadian companies moving into the US market. One of the complications they face is how to make use of wind's all-important production tax credit (PTC), worth $0.02/kWh for entities with a US tax bill to offset. Diduch says Sequoia, which created Sequoia US Inc to hold its US projects, will do what other independent developers in that market do. "We will manage the PTC through a monetisation structure which will utilise a US-based tax investor."