Dive Brief:
- NRG Yield Inc. has bought the 947 megawatt Alta Wind Energy Center in California for $870 million from Terra-Gen Power, an affiliate of private-equity firms Global Infrastructure Partners and Arclight Capital Partners.
- NRG Yield will also assume $1.6 billion in project financings but expects annual earnings from the investment to be $220 million, including returns from some land leases in the wind project’s Tehachapi, California, region.
- The acquisition is being described as a move to cut the NRG Energy generation portfolio’s overall emissions profile in the wake of the just-announced EPA GHG regulations.
Dive Insight:
In addition to its 46 other renewables projects and one nuclear plant, NRG Energy owns 22 coal plants and 81 oil and gas plants. This deal brings the NRG Energy wind portfolio to 2,839 megawatts, the fifth biggest in North America.
NRG Yield is a newly formed arm of NRG Energy, created to turn the guaranteed cash flow from generation projects with utility-backed power purchase agreements into a steady return for investors who buy shares. Alta Wind’s PPAs with SCE have 21 years of returns remaining for phases I-V and 22 years, beginning in 2016, for phases X and XI.
NRG Solar has also made several investments in the Southern California region near Tehachapi.
