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January 10, 2019updated 11 Jan 2019 1:23am

Pattern Energy divests 90MW of K2 Wind power facility in Ontario

Pattern Energy has closed the C$216m ($160m) divestment of its 90MW minority-owned interest in the K2 Wind power facility in Ontario, Canada, to a consortium of investors led by Axium Infrastructure. 

Pattern Energy has closed the C$216m ($160m) divestment of its 90MW minority-owned interest in the K2 Wind power facility in Ontario, Canada, to a consortium of investors led by Axium Infrastructure.

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Wind Power Market seeing increased risk and disruption

The wind power market has grown at a CAGR of 14% between 2010 and 2021 to reach 830 GW by end of 2021. This has largely been possible due to favourable government policies that have provided incentives to the sector. This has led to an increase in the share of wind in the capacity mix, going from a miniscule 4% in 2010 to 10% in 2021. This is further set to rise to 15% by 2030. However, the recent commodity price increase has hit the sector hard, increasing risks for wind turbine manufacturers and project developers, and the Russia-Ukraine crisis has caused further price increase and supply chain disruption. In light of this, GlobalData has identified which countries are expected to add the majority of wind power capacity out to 2030. Get ahead and download this whitepaper for more details on the current state of the Wind Power Market.
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K2 is a 270MW windpower facility in the township of Ashfield-Colborne-Wawanosh.

The deal was announced in November 2018 and completed on 31 December.

Pattern Energy CEO Mike Garland said: “The sale of K2 at a 15.0x ten-year average CAFD multiple demonstrates the intrinsic value of our windpower assets and highlights our ability to selectively recycle assets in order to redeploy capital into more accretive opportunities.

“We have now sold two assets, El Arrayán and K2, at significant premiums to the multiple at which we trade in the markets. We will continue as operator of K2 after the sale. Pattern Energy is the largest operator of windpower facilities in Canada with more than 1,500MW under operation across the country.”

Pattern Energy will report a pretax gain of around $71m on the divestment.

“We have now sold two assets, El Arrayán and K2, at significant premiums to the multiple at which we trade in the markets.”

In November 2018, Pattern Energy acquired a 35MW owned interest in the Stillwater Wind (Stillwater) facility from Pattern Energy Group 2 LP (Pattern Development 2.0) for $23m.

Pattern Energy acquired 51% of the class B interests in Stillwater, while Public Sector Pension Investment Board purchased 49% of the class B interests in the facility. Pattern Energy will operate the facility.

Stillwater began commercial operations in late-October. The facility is in Stillwater County, Montana.

Stillwater has a 25-year power purchase agreement for its total energy produced.

The facility uses 31 Siemens Gamesa wind turbines comprising five 2.3MW turbines with 108m rotors and 26 2.625MW turbines with 120m rotors.

The 80MW facility produces enough power for the annual requirements of approximately 23,000 Montana homes.

Pattern Energy has a portfolio of 24 wind and solar power facilities with a total ownership interest of 2,806MW across the US, Canada, and Japan.

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Wind Power Market seeing increased risk and disruption

The wind power market has grown at a CAGR of 14% between 2010 and 2021 to reach 830 GW by end of 2021. This has largely been possible due to favourable government policies that have provided incentives to the sector. This has led to an increase in the share of wind in the capacity mix, going from a miniscule 4% in 2010 to 10% in 2021. This is further set to rise to 15% by 2030. However, the recent commodity price increase has hit the sector hard, increasing risks for wind turbine manufacturers and project developers, and the Russia-Ukraine crisis has caused further price increase and supply chain disruption. In light of this, GlobalData has identified which countries are expected to add the majority of wind power capacity out to 2030. Get ahead and download this whitepaper for more details on the current state of the Wind Power Market.
by GlobalData
Enter your details here to receive your free Report.

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