Business Review - Wind Capital Group

NTR Increases Investment
During the year, NTR invested additional capital into Wind Capital Group (WCG), increasing its shareholding from 62% to 97% and supporting the completion of Post Rock project financing. NTR’s increased shareholding in Wind Capital Group strengthens our position in the company at a time when it is bringing projects on line and looking forward to a number of exciting prospects.

Lost Creek Performs Well

In its first full year of operation, the 150 MW Lost Creek wind farm in Missouri exceeded its targets, generating $33.1 million in revenue. It achieved world-class turbine availability of 98.7% and overall production was 60% ahead of expected output.

Post Rock Nears Completion

This year, the Wind Capital Group team brought the 201 MW Post Rock project in central Kansas forward from signing a power purchase agreement to securing financing, and from there to construction.

In January, WCG announced that it had closed on financing, with a group of international leaders in project finance lending providing over $376 million in debt facilities to support the construction and operation of the project. The financing included a $293 million construction loan, $63 million in term loan financing, and a $20 million letter of credit facility. NTR provided additional project equity, a portion of which will be released when the project is operational.

Post Rock construction commenced in January and is currently on schedule and meeting onsite health and safety targets. All 134 turbines are now installed and in the process of being commissioned. The project is on target to achieve commercial operation by the end of 2012.

Pipeline Progresses

Early in the fiscal year, Wind Capital secured a power purchase agreement (PPA) for the 150 MW Osage project in Oklahoma, which will be ready for construction in 2013.

Wind Capital is continuing to establish its presence in the Southeast, notably achieving permitting success for its Sugarland Wind Project in Palm Beach County, Florida. The 200 MW Sugarland project is currently under development in a rural portion of Palm Beach County primarily used for agriculture. In March 2012, Wind Capital Group was awarded a “Conditional Use Permit”, marking a significant milestone in the development of what is likely to be Florida’s first wind power generation project. Other promising projects are under development in North Carolina, Alabama and Mississippi.

US Wind Market Outlook

post rock project With the Production Tax Credit (PTC) due to expire at the end of 2012, and no extension or renewal in place as yet, US wind developers have had to scale back development and put some plans on hold. The wind industry is optimistic that the PTC will be extended through legislation, but exactly when – and whether for one or two years – remains to be seen. The uncertainty in the market may slow down development, but Wind Capital is now less dependent on development and more focused on operating its existing wind assets, which will continue to be productive and generate revenues. If the extension does go through, existing projects that can be built in 2013 will be in great demand, particularly those with PPA’s in place, such as Osage.

Despite the current uncertainty for the wind industry in the United States, Wind Capital Group is well positioned as a platform for NTR’s renewable activities in the U.S. market.

Project Highlights

project highlights

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