Yieldco NextEra Energy Partners acquires 229 MWs of wind in dropdown

Written By: Stratton Report
February 22, 2016

Next Era

On February 22, yieldco NextEra Energy Partners, LP announced that it will acquire the 229 MW Seiling I & II Wind Energy Centers from a subsidiary of its sponsor, NextEra Energy Resources, LLC. The wind projects, when completed, will give NextEra Energy Partners’ a portfolio of contracted renewable energy projects of 2,500 MW.

NextEra Energy Partners will pay a total consideration of approximately $323 million, plus the assumption of approximately $200 million in tax equity financing.

The yieldco expects the acquisition to contribute adjusted EBITDA of approximately $73 million to $83 million and CAFD of approximately $30 million to $35 million. The acquisition is expected to contribute to a 3.7 percent increase in the first-quarter distribution to an annualized rate of $1.275 per common unit and support NextEra Energy Partners’ current expectations of 12 to 15 percent per year growth in distributions through 2020 off a $1.23 annualized rate baseline.

NextEra Energy Partners, LP, is issuing common units to fund part of the transaction, and drawing on a revolving credit facility for the balance.

Jim Robo, chairman and chief executive officer remarked:

“We are pleased to announce the acquisition of these two high-quality wind energy centers, both of which are fully contracted with long-term power purchase contracts in place with strong creditworthy counterparties. This acquisition represents yet another example of the strength of the pipeline of organic growth opportunities that our sponsor, NextEra Energy Resources, provides and positions us to advance our growth strategy and deliver unitholder distributions consistent with the expectations we’ve outlined.”