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Wind park hedges its finances; Noble asks to proceed despite money issue

Executives from Noble Environmental Power said that they can raise the $275 million the project costs but that they have been hampered by tumultuous financial markets, according to testimony filed Tuesday. The company asked the state Site Evaluation Committee to allow it to proceed on the condition it proves its financing plan before construction begins. ...An investment banker testifying for the state Tuesday wrote that he did not believe Granite Reliable nor Noble have a plan to finance the park. The company has not shown how it will find lenders and investors.

While a state attorney filed testimony that a proposed wind energy park has no financing plan, the park's owner offered to accept conditional permission to build.

Executives from Noble Environmental Power said that they can raise the $275 million the project costs but that they have been hampered by tumultuous financial markets, according to testimony filed Tuesday. The company asked the state Site Evaluation Committee to allow it to proceed on the condition it proves its financing plan before construction begins.

Granite Reliable Power, majority-owned by Noble, proposes to build 33 turbines along ridgelines in unincorporated Dixville and Millsfield. The project would generate up to 99 megawatts, enough to power 33,000 homes, and would absorb the remaining capacity of the Coos County loop transmission line.

An investment banker testifying for the state Tuesday wrote that he did not believe Granite Reliable nor Noble have a plan to finance the park. The company has not shown how it will find lenders and investors, nor has it said which utility company will buy the electricity produced by the turbines, wrote James Sundstrom, a Manhattan banker who has worked in financing... more [truncated due to possible copyright]  

While a state attorney filed testimony that a proposed wind energy park has no financing plan, the park's owner offered to accept conditional permission to build.

Executives from Noble Environmental Power said that they can raise the $275 million the project costs but that they have been hampered by tumultuous financial markets, according to testimony filed Tuesday. The company asked the state Site Evaluation Committee to allow it to proceed on the condition it proves its financing plan before construction begins.

Granite Reliable Power, majority-owned by Noble, proposes to build 33 turbines along ridgelines in unincorporated Dixville and Millsfield. The project would generate up to 99 megawatts, enough to power 33,000 homes, and would absorb the remaining capacity of the Coos County loop transmission line.

An investment banker testifying for the state Tuesday wrote that he did not believe Granite Reliable nor Noble have a plan to finance the park. The company has not shown how it will find lenders and investors, nor has it said which utility company will buy the electricity produced by the turbines, wrote James Sundstrom, a Manhattan banker who has worked in financing energy projects.

Noble reported $240 million in assets at the end of 2007. Founded in 2004, it operates 726 megawatts of energy generation at seven wind projects in New York and Texas. The company attempted without success to complete an initial public offering in summer and fall 2008, a time when very few companies went public.

In their testimony, Noble's chief financial officer, Christopher Lowe, and the senior vice president for project finance, Jeffrey Wood, wrote that the "extraordinary strains" of current financial markets make it difficult to raise money for even the most robust project.
They said they understood concerns about permitting a project without proven financing but requested the committee allow them until the start of construction to demonstrate long-term financing commitments.

Noble is in talks with several New England utilities about long-term commitments to buy the park's electricity and has spoken with potential investors, they wrote.

But without permission from the state to build the park, they said, already-cautious investors would be even less likely to commit to a major project.

"This is an evolving situation and any expectation that project financing would be quick or easy is probably misguided," Lowe and Wood wrote.

The American Recovery and Reinvestment Act appears to bolster the availability of capital. The new law would grant significant tax credits to alternative energy developers or allow them to receive a cash grant equal to 30 percent of investment at the time operation begins, Sundstrom wrote.

The Noble executive said the company will wait until financial markets have stabilized to approach lenders and investors, a strategy Sundstrom said did not reassure him.

"It cannot be predicted when 'normal financing markets' will return or what they will look like," he wrote.

"We expect still more darkness in the tunnel with respect to illiquid bank lending and capital markets."

He testified that Noble could face additional challenges from a high cost of construction, difficult operating conditions and the availability of energy capacity from existing lower cost plants.

A hearing for the project is scheduled for 10 a.m. March 9 at the Public Utilities Commission office at 21 S. Fruit St. in Concord.


Source: http://www.concordmonitor.c...

FEB 26 2009
https://www.windaction.org/posts/19639-wind-park-hedges-its-finances-noble-asks-to-proceed-despite-money-issue
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