RES Americas closes largest deal selling Cedar Point Wind Project
Enbridge Inc. announced June 29 that it has entered into an agreement with Renewable Energy Systems Americas Inc. (RES Americas) under which a U.S. affiliate of Enbridge Inc. will own and operate the 250-megawatt (MW) Cedar Point Wind Energy Project. Enbridge's investment in the project will be approximately US$500 million and the Broomfield, Colorado-based RES Americas will construct it under a fixed-price engineering, procurement and construction (EPC) contract to Enbridge.
The Cedar Point Wind Energy Project, developed by RES Americas, is located approximately 80 miles east of Denver. Construction of the project will begin shortly with substantial completion expected in late 2011. The project will deliver electricity to the Public Service Company of Colorado (PSCo), an Xcel Energy company, electricity transmission grid under a 20-year, fixed-price power purchase agreement with PSCo.
"Renewable energy aligns very well with our objective to profitably grow our energy infrastructure business," said Al Monaco, Executive Vice President, Major Projects and Green Energy, Enbridge Inc. "Our green energy investments provide attractive returns and establish a new source of earnings growth that complements existing growth in our liquids and natural gas transportation businesses. The investment in Cedar Point bolsters our already strong portfolio of green energy projects and establishes a beach head for future investment into the growing U.S. green energy market. We expect to continue to grow our renewable portfolio, particularly in states like Colorado that support green energy development. The project is expected to be accretive to earnings per share in the first full year of operation in 2012."
"In addition to boosting our bottom line, green energy is a key component in our plan to achieve a neutral environmental footprint as we grow our operations," said Mr. Monaco. "In 2009 we committed to generating a kilowatt hour of renewable energy for every kilowatt hour of energy that our operations consume, and we are making good progress on that objective. We are also very pleased to once again work with RES Americas."
The Cedar Point Wind Energy Project brings Enbridge's interests in renewable energy projects to eight facilities, including interests in wind and solar projects, a hybrid fuel cell and waste heat recovery facilities. The 250-MW Cedar Point project brings the total generating capacity of the green energy projects in which Enbridge has interests to more than 800 MW – enough to meet the energy needs of about 260,000 homes.
The Cedar Point Wind Energy Project will comprise 139 Vestas 1.8 MW turbines, which will be connected to the PSCo grid by a 42-mile transmission line. RES Americas will construct the wind farm and transmission line under a fixed price, turnkey EPC agreement with Enbridge. Vestas will provide operations and maintenance services under a five-year, fixed price service, maintenance and warranty agreement.
A world-leading, fully-integrated renewable energy player in development, engineering, procurement, construction and operating services, RES Americas has developed and/or constructed approximately 10 percent of the installed U.S. wind energy capacity. The Cedar Point Wind Energy Project, the company's third project with Enbridge and first large project in Colorado, will bring RES Americas' constructed and under-construction portfolio to more than 4,800 MW.
"The Cedar Point Wind Energy Project upholds RES Americas' commitment to provide clean renewable energy and jobs to the state of Colorado," said Richard Ashby, CFO of RES Americas. "Working with Enbridge and PSCo, RES Americas is excited to contribute to the state’s goals of providing economic benefits to the community and helping ensure a secure energy future."
Development of the Cedar Point Wind Energy Project aligns not only with Enbridge's goals, but with those of the state of Colorado as well. On March 22, 2010, Colorado Gov. Bill Ritter signed into law landmark legislation that gives the state the highest renewable energy standard in the Rocky Mountain West, requiring that 30 percent of the state's electricity be generated from renewable sources by 2020. "The Cedar Point Wind Energy Project will help provide Colorado's supply of clean, reliable power while bringing jobs and economic development to communities in our state, fulfilling our promise of a new energy economy," said Gov. Ritter
Enbridge and RES Americas expect the project will create up to 250 construction jobs and, through its ongoing operations, generate revenue for businesses in the region.
Cedar Point Wind Energy Project at a glance:
- Capacity peak: about 250 MW
- Turbines: 139 Vestas 1.8 MW turbines
- Annual yield: approximately 875,000 MWh (corresponding to the annual consumption of around 80,000 Colorado households)
- CO2 saving: about 710,000 tons per year