Innergex Renewable Energy has secured a $534 million construction loan and term financing and $49 million letter of credit facility for its 329.8MW Boswell Springs wind project in Wyoming.
The term financing included a $203 million 10-year non-recourse term loan from BNP Paribas, Credit-Agricole CIB, Export Development Canada, and MUFG Bank, acting as joint lead arrangers. The project is expected to begin operation by the end of 2024.
An additional tax equity investment for the project is expected to close during Q3 2023.
"We are very pleased with the terms of this financing as it demonstrates the strong market confidence in Innergex’s technical and financial abilities to develop high-quality and well-structured assets that generate attractive cash flows,” said Michel Letellier, Innergex's president and chief executive.
"In addition, the passage of the Inflation Reduction Act (IRA) brings more competitiveness to the renewable energy sector than ever before by providing bonus credits for certain clean energy projects. In the case of Boswell Springs, we were pleased to learn that the project is eligible for the Energy Community PTC Bonus, and we decided to seize the opportunity to finance the bonus credits to substantially improve the investment economics, over and above associated cost increases.”
The IRA may allow the Boswell Springs project to qualify for 120% of production tax credits, PTCs, with an additional 10% energy community PTC due to the project's location in an "energy community." This additional tax benefit is still being evaluated.
If closed the tax benefits could contribute more than $42 million annually for ten years in addition to the $22 million in cash flow from the wind power.
Innergex has finalized procurement of wind turbine generators from GE Vernova, and the permitting process is completed. Additionally, EPC contracts were signed by Mortenson as plant contractor and AEI as contractor for transmission line.
Total construction costs are estimated to be $576 million, with $103 million of which is being funded by Innergex's own revolving credit facilities.
The project has a 30-year, 320MW PPA with Berkshire Hathaway's subsidiary PacifiCorp, an electric utility in Utah, Wyoming, and southeastern Idaho. The PPA was signed in August of 2022 (PFR, 8/16/22).