Allianz Risk Transfer and Apex Clean Energy close proxy revenue swap for Old Settler Wind Farm

Old Settler Wind, jointly owned by Apex Clean Energy and Northleaf Capital Partners, has executed a 10-year proxy revenue swap with Allianz Risk Transfer that will secure long-term predictable revenues and mitigate the energy generation volume uncertainty related to the weather as a fuel resource.

The proxy revenue swap, an innovative new risk management tool for the wind power industry, was created and commercialized through a collaboration among ART Bermuda, Nephila Capital Limited, REsurety, and Altenex This transaction represents the second 10-year proxy revenue swap to be sold, and the first to rely on the hedge to secure third-party commercial financing.

Old Settler Wind is a 151.2 MW facility in Floyd County, Texas, that will generate enough clean electricity to power 51,000 average U.S. homes. The project is part of a 217 MW portfolio that also includes Cotton Plains Wind and Phantom Solar, the debt financing and tax equity commitments for which were announced on July 14, 2016. The portfolio of projects is expected to achieve commercial operation in the first quarter of 2017.

As we reported in late July, Apex Clean Energy (APEX) sold a majority ownership stake in the 217 MW renewable energy portfolio to Northleaf Capital Partners.

In a deal announced in January,  Defense Logistics Agency (DLA) Energy, in coordination with the U.S. Army Office of Energy Initiatives (OEI) and Fort Hood, signed a Renewable Energy Supply Agreement (RESA) with Apex for 65.8 MW of electricity from from Cotton Plains Wind and Phantom Solar to supply energy to Fort Hood. The Army is expected to pay about $168 million less than what it would pay for power from the traditional electricity grid over the course of the 28-year agreement.

Mark Goodwin, president of Apex, said:

“Apex is pleased to have successfully closed the financing on this innovative revenue product, providing a new resource to further accelerate our nation’s shift to clean energy.”

Karsten Berlage, managing director of Allianz Risk Transfer, said:

“This transaction validates our thesis behind the proxy revenue swap—that it enables best-in-class financing options for wind projects through a unique and holistic approach to managing revenue risks.”