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Pattern Energy Acquires Panhandle 1 Wind Project in Texas Increases Operating Capacity by 16% as it Reaches Completion

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Pattern Energy Acquires Panhandle 1 Wind Project in Texas Increases Operating Capacity by 16% as it Reaches Completion






Pattern Energy Group Inc. (Nasdaq:PEGI) (TSX:PEG) today announced it has closed on its commitment to acquire 172 megawatts (MW) of owned interest in the 218 MW Panhandle 1 wind project from Pattern Energy Group LP for a total cash consideration of US$124.4 million. The balance of the project has been acquired from Pattern Development by three institutional tax equity investors.




Acquisition Highlights




  — Full 218 MW has completed construction and is fully operational

  — Portfolio now comprises nine operating wind facilities and two

     construction projects

  — Second completed acquisition since the Initial Public Offering (IPO) in a

     series of anticipated transactions with Pattern Development

  — Project utilizes General Electric 1.85 MW turbines and is secured with a

     long-term contract for 77% of its output

  — Located in one of the strongest wind resources in the country

  — Cash purchase price represents a 9-10x multiple on run-rate CAFD [1]

     contribution from the project





“This acquisition adds 16% to our operating capacity and marks our third project to successfully reach completion this year,” said Mike Garland, President and CEO of Pattern Energy. “It is the second project

we have acquired from Pattern Development that has gone into operation since our IPO – again demonstrating the value of that strategic partnership – and we anticipate their extensive pipeline will create more opportunities that will help us meet or exceed our growth plans.”




Panhandle 1 is located in Carson County, Texas, and consists of 118 General Electric 1.85 MW wind turbines. The facility is utilizing Texas’ new Competitive Renewable Energy Zone (CREZ) transmission

infrastructure, which connects to the state’s main power grid operator, Electric Reliability Council of Texas (ERCOT).




“Panhandle 1 is located on one of the best wind sites in the U.S. with a strong wind resource and excellent access to transmission,” added Garland. “The strength and reliability of the wind, coupled with an unleveraged finance structure, will result in stable, steady cash flows from the project.”




The Panhandle 1 project created more than 275 construction jobs and 11 permanent operations and maintenance positions. According to statistics from the U.S. Energy Information Agency, it will generate clean, renewable electricity for up to 60,000 Texas homes each year without using any of the region’s limited water supplies.




Approximately 77% of the expected output of Panhandle 1 is contracted under a 13-year energy price hedge, with an A-/Baa2 credit-rated affiliate of Citibank, with the balance sold at ERCOT’s spot market





About Pattern Energy




Pattern Energy Group Inc. is an independent power company listed on the NASDAQ and Toronto Stock Exchange. Pattern Energy has a portfolio of eleven wind power projects, including one project it has agreed to acquire, with a total owned interest of 1,472 MW, in the United States, Canada and Chile that use proven, best-in-class technology. Pattern Energy’s wind facilities generate stable long-term cash flows in attractive markets and provide a solid foundation for the continued growth of the business.


Posted July 2, 2014

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