Innergex cuts 2022 output outlook, meets US wind PPA conditions

Innergex Renewable Energy Inc (TSE:INE) has lowered its 2022 projections for free cash flow per share and output and made an update related to the PPA for its 320-MW Boswell Springs wind project in Wyoming.

The Canadian power producer said on Wednesday it has met all necessary conditions to make the power purchase agreement (PPA) for Boswell Springs come into force. The 30-year contract with PacifiCorp, a subsidiary of Berkshire Hathaway Inc (NYSE:BRK.A), was signed in August 2022.

Innergex is currently working to secure debt and tax equity financing for the USD-544-million project and is gearing up to commence on-site construction works in the second quarter. The wind farm, to be powered by GE hardware, is scheduled to go live in the closing quarter of 2024.

The Canadian firm anticipates the operating cash flows from Boswell Springs will be around USD 22.6 million a year. The project will receive Production Tax Credits, which will bring some USD 39.2 million annually.

FINANCIAL OUTLOOK

Innergex revised downwards its projections for power generation in 2022, expecting an increase of 13% as compared to 2021 levels, rather than by 22%. Free cash flow per share, meanwhile, is seen to be around 10% less than the guidance of CAD 0.75 (USD 0.55/EUR 0.51) provided last August, according to preliminary calculations.

The adjustments had to be made due to the extremely low hydropower resources in British Columbia and the revenue-sharing mechanism for certain PPAs in France. No other metrics in the 2022 forecast have been revised.

Innergex’s 2022 financial report is due to be released on February 22.

(CAD 1.0 = USD 0.740/EUR 0.686)

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