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Mo. regulators set hearing for Empire plan to acquire 600 MW of wind


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Mo. regulators set hearing for Empire plan to acquire 600 MW of wind

Missouri regulators have set a public hearing for late January 2019 to consider Empire District Electric Co.'s plan to add 600 MW of wind energy capacity to its power generation portfolio.

Empire, owned by Algonquin Power & Utilities Corp., won approval from the Missouri Public Service Commission in July 2017 to add the wind capacity, saying it would provide savings to customers totaling $295 million over 30 years.

Since then, Empire has been working with wind developers on plans that will result in the utility's acquisition of the projects. The company has two related requests at the PSC for certificates of convenience and necessity that, if approved, would authorize its acquisition of holding companies that own the wind projects. The commission will hold a public hearing on Jan. 23, 2019, in Joplin, Mo., with evidentiary hearings scheduled for April 8-11, 2019.

In one of the requests, filed in October, Empire sought approval for two purchase and sale agreements, one for a 150-MW facility called Kings Point, to be located in Barton, Dade, Jasper and Lawrence counties in Missouri, and a second 150-MW facility, called North Fork, in Jasper and Barton counties.

Empire is partnering with a Tenaska Energy Inc. affiliate, Tenaska Missouri Matrix Wind Holdings LLC, and an entity called Steelhead Missouri Matrix Wind Holdings LLC on both projects. Once the purchase and sale agreements close, Empire will acquire 100% of Class B shares and a tax equity partner, Wells Fargo, will acquire all Class A shares in the holding companies for the two projects. That will result in the two holding companies becoming subsidiaries of Empire. After about 10 years, Empire will have the right to purchase the tax equity partner's ownership interest in the holding companies.

Steelhead was not further identified in the application except as "a wind project developer that has incurred cost for wind turbine components in 2016," which would qualify the projects as fully eligible for U.S. production tax credits (Missouri PSC File No. EA-2019-0010).

Wind turbine manufacturer Vestas Wind Systems A/S' North American development business is known as Steelhead Americas.

In Empire's second request, submitted Nov. 18, the company is proposing a similar purchase and sale agreement arrangement for the approximately 300-MW Neosho Ridge Wind Project, to be built in Neosho County, Kan. Empire's development partner is Neosho Ridge Wind JV LLC, a venture between Apex Clean Energy Inc. and an entity called Steelhead Wind 2 LLC, which is to provide equipment that qualifies the project for production tax credits. In this case as well, Empire will be financing the project with Wells Fargo as its tax equity partner (Missouri PSC File No. EA-2019-0118).

The wind projects are expected to be in service by the end of 2020.