Indiana wind farm among AEP projects being divested
Ohio-based American Electric Power (Nasdaq: AEP) has inked an agreement to sell its unregulated, contracted renewables portfolio, which includes its stake in a wind farm in Benton County. The utility says the deal is valued at $1.5 billion.
AEP is selling the portfolio, which totals 1,365 megawatts of renewable energy projects, to IRG Acquisition Holdings, a partnership owned by Chicago-based sustainable energy solutions developer Invenergy, Canadian global investment group CDPQ, and funds managed by Blackstone Infrastructure.
The portfolio includes 14 projects, representing 1,200 MW of wind and 165 MW of solar in 11 states.
The Fowler Ridge II wind farm in Fowler, Ind. is among the projects. AEP is selling its 50% stake in the wind farm, which began operation in 2009 and is operated by BP. It is the only Indiana project involved in the sale.
AEP said Thursday it expects to net about $1.2 billion in cash after taxes, transaction fees and other customary adjustments.
“We’re committed to de-risking the company and prioritizing investments in our core regulated businesses,” AEP President and CEO Julie Sloat said in a news release. “The proceeds from the sale will be directed to the significant pipeline of opportunities we have to enhance service for customers across our footprint and advance our clean energy transition.”
The sale remains subject to regulatory approval and clearance from the Committee on Foreign Investment in the United States.
AEP expects the deal to close in the second quarter.
Meanwhile, the utility’s subsidiary, AEP Energy Partners, announced Thursday it has inked a power purchase agreement with Lightsource bp to acquire energy generated from the Honeysuckle Solar project in New Carlisle that is currently under construction.
When complete, Lightsource said Honeysuckle Solar will generate 188 MW of power, which is enough clean energy to power 27,000 homes annually.
Lightsource said the project will create about 200 direct construction jobs and provide an estimated $30 million to the local economy over the life of the project.
“This power purchase agreement is a great example of how energy buyers with sustainability goals such as AEP Energy Partners can work with us to spur the buildout of new solar projects that will improve the health and energy security of communities across America while helping strengthen local economies, “Lighsource CEO of the Americas Kevin Smith said in written remarks. “As the owner and operator of the Honeysuckle solar farm, we look forward to bringing economic and environmental benefits to the region, along with fostering community partnerships.”
Commercial operation at Honeysuckle Solar is expected to begin in 2024.