The sun sets over the Wildcat wind farm north of Elwood. E.ON Climate and Renewables has invested $400 million in building phase one of Wildcat 1 Wind Farm.
E.ON Climate & Renewables hopes a new set of investors will help it capitalize on a federal tax subsidy for the 200-megawatt Wildcat Wind Farm.
Last week, it said it had secured nearly $175 million in tax equity financing, via investors that include JPM Capital Corp. — a.k.a. J.P. Morgan — and Wells Fargo Wind Holdings LLC.
In exchange for their stake in the project, the companies bought the farm’s federal wind energy tax credits — 2.2-cents per kilowatt generated — which otherwise would have gone unused, said E.ON spokesman Matt Tullis.
“We don’t have enough of a tax liability,” he said. “This is a way for us to gain some extra capital.”
The turbines in phase one, which straddles the county line between Madison and Tipton, were commercially operational by Dec. 8.
E.ON expects them to generate more than $31 million in local taxes, $11 million in local salaries and earn landowners more than $73 million. At the height of construction, the project brought more than 200 jobs to the area.
In other news, there’s a chance E.ON might move forward with two more phases of the Wildcat project, although nothing’s set in stone yet.
Phase two would involve building 40 to 60 turbines, producing at least 100 megawatts of electricity per year — enough to power around 40,000 homes. Phase three would see 40 to 75 new turbines, producing somewhere between 100 to 130 megawatts.
The new turbines would be located in Howard and Grant counties and could be operating by 2014, said development manager Andy Melka. They would pump power into the grid through substations southwest of Swayzee or in Greentown.
Before the project can move forward, there are still a lot of moving targets, Melka said.
“There’s still a lot of work to be done,” he said, including environmental studies, choosing a turbine model, engineering and speaking with landowners.
He said E.ON also needs to decide whether it will see enough profit from its investment, which could be as much as $200 million for each additional phase. Phase one cost about $400 million.
Both counties have approved road and economic development, decommissioning, tax abatement and other agreements that would help the project move on.
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