V SEPA GREEN POWER PARTNERSHIP9 Aligning Green Power Partners with New Renewable Energy Projects Pilot Project Summary Project Name: Carroll Area Wind Farm Developer Name: Carroll Area Wind Farm, a joint venture of OwnEnergy, Inc. and nine Iowa families Contact: Steve Krebs, steve.krebsffiownenergy.net Renewable Energy Type: wind Total Planned Megawatt Size: 20.70 Project Location: Carroll County, Iowa Is the project permitted?: Yes If no, what is the permit status?: What is the status of the project's site? The developer has leased 100% of the proposed wind project footprint. Site leases run for a 20 year period from signing and are followed by an unlimited number of 5 year extensions as desired by the project company. Have land leases been filed with the county? The majority of lease and easements have filed with the County. The remainder will be filed within the next month. What is the status of interconnection, and have system impact and facility studies been completed? (Distribution or transmission level projects are both eligible): The project company has entered into an interconnection agreement with MidAmerican Energy, the applicable distribution utility. Security has been posted. The project intends to interconnect to MidAmerican Energy's Templeton 69kV substation, located 1 mile to the south of the project. ------- Does the transmission owner (TO) or independent system operator (ISO) have a process to study the project's impact on the local or regional grid and the subsequent cost to interconnect?: The project initially submitted an interconnection request to MidAmerican Energy and received a feasibility study in 2007, prior to MidAmerican joining the Midwest ISO in 2009. The project submitted a system impact study request in early 2008 and the SIS results on 7/15/2008. Thereafter, MidAmerican Energy joined the Midwest ISO but retained control over its 69kV network. As such, MidAmerican Energy generated a facilities study on 6/30/2011. By mid-2012 the developer and MidAmerican Energy we negotiating a Generation Interconnection Agreement and as such when control over the 69kV network passed to the Midwest ISO later that year the project was allowed to continue negotiations directly with MidAmerican Energy. The resulting GIA closely mirrors the central provisions of a Midwest ISO GIA although MISO is not party to the actual GIA. Environmental Impact Statement status: The project does not require a major federal action under NEPA and so no EIS or EA has been prepared. The project developer has worked diligently with the Iowa DNR and US FWS as well as the Iowa State Historical Society, Iowa DEP, and the Army Corp of Engineers to ensure the project avoids, minimizes, and mitigates environment impacts to the extent practicable. Is any element of the project - technology or other - experimental or pilot-phase?: The project will be the first project to incorporate a tax equity financing while utilizing the Iowa state production tax credit ("Iowa PTC"). Only one other wind project of at least 20 MW has utilized the Iowa PTC (and none since 2005). To ensure the certification of the Iowa state production tax credits, the ownership structure of the Project includes 10 limited liability companies each incorporated in the state of Iowa and jointly owned by local partners as well as OwnEnergy. The local partners control 51% of the voting equity of the project, so the project is a true community project. Otherwise, the project is using commercial-grade, utility-scale wind turbines manufactured in accordance with international standards. What is the long- and short-term operations program of the project? Does the renewable energy technology manufacturer have a technical support team locally available?: The developer anticipates using Siemens 2.3MW 108m rotor turbines at the project. Siemens manufactures the blades for these turbines in Fort Madison, IA. The developer also anticipates contracting with Siemens to provide the operations and maintenance support for these turbines for a period of up to 5 years. Thereafter, the project owner will likely contract with a 3rd party provider of such services. For wind projects, has a meteorological tower been installed, and when was the tower installed/how much data has been collected?: One 60 meter met data has been in place since April 2008. ------- Who has analyzed the data and what is that person's experience with respect to projects that have actually been financed?: Data has been analyzed by V Bar and Garrad Hassan as well as OwnEnergy's proprietary TED resource evaluation system. That team performed the wind resource evaluation work for the Patton (Pennsylvania), Cowboy Wind Farm (Oklahoma) and Bobcat Bluff (Texas) projects that reached commercial operations in 2012. Can the turbine manufacturer be financed through "traditional" tax equity and debt in the U.S.?: Yes. Siemens is a leading supplier to the US wind industry, with a proven track record of performance internationally. Provide a short summary of how the project views project finance and structure/ownership: As noted above, the project seeks to utilize the Iowa production tax credit ("Iowa PTC") and enter into a tax equity "flip" financing transaction. Successfully using the Iowa incentive, would allow the project to achieve a lower cost of capital and sell its power more competitively. The project intends to monetize the Iowa PTCs OwnEnergy would consider selling its interest in the project to an equity investor that could utilize directly the Iowa PTC, which would be more efficient than monetizing the incentive through a third party. At this time, the Local Partners intend to retain their interest in the project. What are your ideal types of prospective institutions/partners?: OwnEnergy believes that the Carroll Area Wind Farm promises more than a source of clean energy. In particular, its size, location and participation of local individuals in combination with OwnEnergy's development approach provide many more possibilities for the right partners for whom sustainability is a critical focus. Community wind projects typically create more jobs and retain more economic effects within the local community than absentee project ownership. OwnEnergy expects this project to make a similar contribution. OwnEnergy's business model envisions the development of mid-sized wind projects with a local partner as an equity owner. In the Carroll Area project, 9 local families will own a combined 51% voting interest and 27% equity ownership, with OwnEnergy contributing its development and management expertise and most of the development capital. With its contribution, OwnEnergy seeks to empower clean energy entrepreneurs in rural America. An ideal partner in the project would share OwnEnergy's interest in sustainable development and the goals of its business model. OwnEnergy would welcome a utility or non-utility buyer of the energy and environmental attributes produced by the project. OwnEnergy has successfully structured power purchase agreements with commercial and industrial offtakers. Most recently, OwnEnergy implemented an offtake arrangement with Oklahoma State University ("OSU"), whereby the project company sold all of its production to Oklahoma Gas & Electric ("OGE"), which turned around and sole all of the energy and environmental attributes to OSU. ------- This innovative structure produced over $7mm in royalties to landowners over 25 years, about $lmm in economic benefits to community development partners, $10mm in property tax payments over 25 years, 150 construction jobs and 3 permanent O&M jobs. OSU received naming rights to the project, which was christened "Cowboy Wind Farm" in honor of the school's mascot. In addition, OSU avoids power price and natural gas volatility and expects to save over $10mm in energy costs over the life of the arrangement, achieves its sustainability goals of powering 2/3 of its Stillwater campus with wind power, furthers its land grant college mission. OGE retains a high profile anchor customer in OSU with a locked in gross margin, supports the education of its future workforce and enhanced its reputation in thought leadership in renewable energy.1 As discussed, the Carroll Area wind project and partnering with OwnEnergy have tremendous potential. OwnEnergy would be pleased to discuss with all interested parties how the development and commercialization of the Carroll Area wind project could proceed. 1 To learn more about Cowboy Wind Farm and please see (1) a video of the development of the project at: http://www.ownenergy.net/media-center/videos/blackwell-winds-change. and (2) a case study presented at Windpower 2013 "On The Road to Additionality: A Developer's Approach to Paving the Way for more Commercial and Industrial Offtakers" at http://www.ownenergy.net/events/speaking-engagement/2013/05/06/windpower-conference- exhibition-2013. ------- |