Ontario's feed-in tariff prompts 4.4 GW wind acquisition?

Calgary, Alberta-based Canadian Hydro Developers (TYSX:KHD) said today it is acquiring rights to a prospective 4,400 megawatt offshore wind farm in Ontario from Wasatch Wind.

When completed, it’s expected to be the largest offshore facility in the world, with the potential to power more than two million homes.

Financial details of the agreement with Park City, Utah-based Wasatch Wind were not disclosed. Wasatch is a wind energy developer and wind tower systems designer and supplier.

The site is about five to 30 kilometers (3.1 to 18.6 miles) offshore in one of the Great Lakes that borders Ontario, and close to transmission interconnection. The exact location was not disclosed.

Canadian Hydro said it expects the facility to be built in stages, with the first 400 MW to 500 MW to be completed in the fourth quarter of 2014. The company operates wind, hydro and biomass facilities throughout Canada.

It’s not clear whether the acquisition was prompted by a feed-in tariff enacted last week under Ontario's Green Energy Act. The tariff grants renewable energy companies a fixed price that's above market rates for electricity they generate.

The act was first unveiled in March, calling for up to $5 billion in spending over several decades to encourage the growth of renewable energy and create 50,000 jobs in the next three years (see Ontario casts green shadow on U.S.).

Energy from the prospective project would be eligible for a feed-in tariff at a price of $190 per megawatt hour over 20 years, subject to consumer price index inflation, according to Canadian Hydro.

In July, Canadian Hydro received an unsuccessful, hostile takeover bid from TransAlta (see TransAlta’s takeover looks like it’s a no go and TransAlta makes hostile $589M takeover bid for Canadian Hydro Developers).

Canadian Hydro said earlier this month it has since received a number of other offers and that TransAlta no longer has the leading proposal.

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