The FINANCIAL — Expanding their renewable energy portfolios, three global companies – Google and subsidiaries of ITOCHU Corporation and Sumitomo Corporation (TYO-8053) – have joined GE (NYSE: GE) unit GE Energy Financial Services and developer and managing member Caithness Energy as owners of the world’s largest wind farm, the 845-megawatt Shepherds Flat wind project under construction near Arlington, Oregon.
Google, ITOCHU Corporation subsidiary Tyr Energy and Sumitomo Corporation subsidiary Sumitomo Corporation of America are investing approximately $500 million in the $2 billion project. Additional financial details of the transaction were not disclosed.
“The new investors contribute a wealth of energy expertise, innovation and strong financial profiles to the landmark Shepherds Flat wind farm project,” said Les Gelber, a partner at Caithness Energy.
The Shepherds Flat wind project stretches across 30 square miles of Gilliam and Morrow Counties in north-central Oregon. Once completed next year, the project will generate enough energy to supply more than 235,000 average US homes, and will avoid about 1.5 million tons of carbon dioxide per year, equivalent to the amount of carbon dioxide from approximately 260,000 passenger vehicles,according to GE.
"As originally envisioned, we are drawing on our ability to attract more private capital to the US wind market by adding partners to the Shepherds Flat project,” said Alex Urquhart, president and CEO of GE Energy Financial Services, which announced its investment in the Shepherds Flat project in December 2009. “Such projects boost energy security and supply, create jobs, and build on our partnerships with Google, ITOCHU and Sumitomo.”
“We’re excited to be investing with strong partners in the largest wind farm project in the world,” said Rick Needham, Director of Green Business Operations at Google. “This project is particularly attractive because it deploys advanced turbine technology while delivering clean, renewable energy. We hope that our support for Shepherds Flat encourages more investment in this sector, and accelerates the development of clean energy resources across the country.”
Construction is proceeding in three phases. All turbine foundations have been completed and electrical work and road construction are nearing completion on the first 265-megawatt phase; road and turbine foundation construction is more than half complete on the second 290-megawatt phase; and road construction and foundation construction are continuing on the third 290-megawatt phase. Turbine shipments to the site are expected to begin this spring. Construction involves not only the erection of 338 turbines, but development of 95 miles of roads and 167 miles of transmission lines. Caithness Energy has estimated that the project will inject $16 million annually of direct economic benefits into Oregon, and will employ 400 workers during construction and 35 during operation.
Said Tyr Energy's president and CEO, Karl Usami, "As a long-standing and long-term investor and participant in the North American power generation industry, we are particularly pleased and excited about investing in this state-of-the-art wind power facility and working with all our partners to bring clean and reliable energy to the market, and important green energy jobs to our economy."
“The investment in the Shepherds Flat wind farm reinforces our commitment to ensuring a cleaner environment for all of us and future generations,” said Masao Miyamoto, Head of Power and Telecom Business, Vice President of Sumitomo Corporation of America. “We continue to look for similar opportunities where we can leverage our experience and know-how as a long-term strategic investor and work with strong partners on high-quality renewable energy projects in the advanced development or construction phase.”
The project will be the first wind farm in the United States to use GE Energy’s 2.5xl wind turbines, which are larger than its other models and use permanent magnet generators—turbine technology that improves efficiency, reliability and grid connection, helping to lower wind energy costs. The 2.5xl wind turbines for the Shepherds Flat wind farm are assembled at GE’s site in Pensacola, Florida. In addition to supplying the wind turbines, GE will provide operational and maintenance services to the project.
Under three 20-year power purchase agreements, the Shepherds Flat wind farm will supply renewable energy to Southern California Edison, an Edison International (NYSE:EIX) company, helping California meet its renewable energy goals.
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