Horizon Wind Energy, the U.S. unit of Portuguese clean energy company EDP Renováveis (EDPR), has secured $101.9 million of institutional equity financing from JPM Capital to support the development of its 100.5-megawatt Rail Splitter wind farm in central Illinois.
The transaction is interesting because it is structured around the stimulus-funded direct cash grant program implemented by the Department of Energy and the Treasury Department to support the construction of clean energy assets.
In exchange for the financing, JPM Capital, of Frisco, Texas, will get a stake in Rail Splitter as well as access to the cash grants that the farm is expected to receive in lieu of tax credits. In short, JPM not only secures a lump of cash backed by the U.S. government — you don’t do better than that in terms of guarantees — but also earns a share of the revenues generated over time from Rail Splitter power sales.
Rail Splitter was installed in June and is located north of Springfield, the state capital.
On Tuesday, Treasury and the DOE released — see for the press release — the first batch of these much anticipated grants, some $502 million out of an expected $3 billion. The big winner was Spain’s Iberdrola, which got some $236 million for wind farms in Texas, Oregon and Minnesota and an additional $59 million for a Pennsylvania wind project. Horizon got $47.7 million for its 97-megawatt Wheat Field wind farm in Oregon.