At the 26th annual Canadian Wind Energy Association (CANWEA) Conference in September 2009, Macquarie Senior Vice President Rob Roberti chaired a panel on financing wind projects in the current economic climate.

Panellists agreed that wind will continue to play an important role in Ontario’s electricity supply mix and that it represents an attractive investment.

“Wind power has strong growth potential, especially here in Canada where there are excellent and largely untapped wind resources,” said Mr. Roberti. “In addition, with long-term power purchase agreements, such as we have at our Erie Shores Wind Farm, wind power facilities are not subject to economic swings or commodity price movements.”

Panellists highlighted the “portfolio effect” of wind power, agreeing that the addition of wind power --- which relies on a zero-cost resource --- to a portfolio can help to reduce the overall cost and risk of the portfolio. Wind power also presents attractive economics relative to investments in other forms of power generation, particularly when the environmental impacts of other energy sources are considered.

Panellists also agreed that while the current market climate can make it more challenging for developers to secure financing, quality wind power projects remain of interest to lenders given the long-life nature of the asset, low operating costs and underlying contractual nature of the cash flow.

Mr. Roberti added, “There have been significant improvements in modelling techniques over the past few years, so estimates of the quality of the wind resource and capacity are increasingly accurate. At the same time, turbine technology is continuing to evolve, which makes wind power facilities more and more efficient.”

Did you know?

According to CanWEA, Canada currently has installed wind capacity of approximately 2,845 MW. In 2009, there is expected to be 790 MW of new installed capacity. Erie Shores Wind Farm currently represents about 3.5% of Canada’s wind power capacity.

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