Innergex Renewable Energy Inc. closed a $72 million non-recourse construction and term project financing for the Northwest Stave River run-of-river hydroelectric project located in British Columbia, Canada.
The 17.5 MW Northwest Stave River hydroelectric project is located on Crown land, about 35 km north of Mission, British Columbia. Construction began in 2011 and commercial operation is expected to begin in the fourth quarter of 2013. Northwest Stave's average annual production is estimated to reach 61,900 MWh, enough to power about 6,000 average Canadian households.
All of the electricity it will produce will be covered by a 40-year fixed-price power purchase agreement with BC Hydro, which was obtained under that province's 2008 clean power call request for proposals and which provides for an annual adjustment to the selling price based on a portion of the consumer price index. The proceeds of the financing will be used to fund about 80 percent of the total project costs.
The $72 million construction loan will carry a fixed interest rate of 5.3 percent; upon the start of the project's commercial operation, it will convert into a 40-year term loan and the principal will begin to be amortized over a 35-year period, starting in the sixth year.
The financing has been arranged by Industrial Alliance Insurance and Financial Services Inc. as agent and lead lender, and includes Stonebridge Infrastructure Debt Fund I L.P. as lender.