American Electric Power says its competitive renewable energy subsidiary, AEP Clean Energy Resources, has completed the purchase of Sempra Renewables LLC and its 724 MW of operating wind generation and battery assets for approximately $1.05 billion.
The deal was originally announced in February.
The purchase includes all or part of seven wind farms and one battery installation in seven states. Five of the wind farms are jointly owned with BP Wind Energy. BP Wind Energy will retain its ownership share of those projects. Twenty employees will join AEP Clean Energy Resources from Sempra Renewables.
“The addition of these high-quality renewable assets and the experience of our new employees will support our long-term strategy to diversify our generation fleet,” says Nicholas K. Akins, AEP chairman, president and CEO. “We’ve targeted a total of $2.2 billion in capital investment in competitive, contracted renewables by 2023.”
The seven operating wind farms, located in Colorado, Hawaii, Indiana, Kansas, Michigan, Minnesota and Pennsylvania, have an average capacity factor of 37%. They all have long-term power purchase agreements for 100% of the energy produced with investment-grade investor-owned utilities, municipal utilities and electric cooperatives. The project PPAs have an average remaining life of 16 years. AEP operating units AEP Ohio, Indiana Michigan Power and Southwestern Electric Power Company have PPAs with two of the wind farms.
AEP Renewables also recently signed a separate agreement to purchase a 75% interest (227 MW) in the Santa Rita East Wind Project currently under construction west of San Angelo, Texas. AEP Renewables will acquire its share of the project upon completion, which is expected in June.
With this acquisition, AEP’s competitive renewable generation portfolio has grown to 1,075 MW of renewable generation in 11 states. It will increase to 1,302 megawatts upon completion of the Santa Rita project.
