Algonquin Power Signs Share Purchase Agreement with EffiSolar Energy

US- based Algonquin Power and Utilities’ subsidiary for generation of power, Algonquin Power has signed a share purchase agreement with EffiSolar Energy. Under this agreement, Algonquin Power will buy all the current and outstanding shares of Cornwall Solar based on approval from Ontario Power Authority and upon the completion of certain stages.

Cornwall Solar presently owns the rights for the development of a solar project with a capacity of 10 MWac at Cornwall, Ontario. The solar project has been awarded an Ontario-based 20 year Feed-in-Tariff by the Ontario Power Authority at the rate of $443/MWhr. This is likely to create initial yearly revenues of $6.2 million. The project is also expected to generate 13,400 MWh of electricity annually using the ground mounted PV array system. Construction of the project is likely to start by the second half of 2012 and the project is expected to be operational by the beginning of 2013. The project will occupy a total land area of 138 acres. The project involves total capital costs of $45 million including the amount required for the acquisition of the project. Financing of the project will be completed upon fulfilment of the terms and conditions.

Apart from this project, Algonquin Power also has the option to buy 10 other solar based projects in Ontario. The total Feed-in Tariff applications for all these projects put together amount to 100MWac. The acquisition is expected to be completed by the end of this year based on meeting the terms and conditions of the transaction.