TransAlta Renewables has signed an agreement to buy two wind projects in the northeastern part of the US.
The two construction-ready projects consist of a 90MW project in Pennsylvania and a 29MW project located in New Hampshire.
The Pennsylvania project has a 15-year power purchase agreement while the New Hampshire project has two 20-year PPAs.
The combined cost of the projects is projected to be $240m, of which around 70% will be funded this year while the remaining will be done next year.
The two projects will become commercially operational in the second half of 2019.
TransAlta Renewables president John Kousinioris said: “This acquisition demonstrates our commitment to grow and diversify our cash flows through the addition of long-term contracted assets with high quality counterparties, and expands our presence in the United States.”
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By GlobalDataThe acquisition and construction costs will be funded by TransAlta Renewables through its existing liquidity and tax equity.
The deal aligns with its renewable strategy, which focuses on acquiring contracted renewable power generation assets that provide stable cash flow through long-term power purchase agreements.
This acquisition is expected to boost value for shareholders in the long-term besides enabling geographic and asset diversification for the company.
This acquisition comes following its financial results, which showed Comparable EBITDA and Cash Available for Distribution (CAFD) increasing year-over-year for the full year ending 31 December.
Its full year Comparable EBITDA increased by $17m over last year to touch at $424m, mainly due to the commissioning of the South Hedland power station. However, its Comparable EBITDA for the quarter saw a decline of $3m from the fourth quarter of 2016 to reach at $118m.
For the full year, CAFD increased by $39m to $284m compared to $245m of 2016. Fourth quarter CAFD saw an increase of $19m year-over-year to $88m, primarily because of the additional cash flow from South Hedland.
