Google and Citi commit $110m to GIP-backed wind farm

The California wind farm is being developed by Terra-Gen Power, an energy developer owned by ArcLight Capital and Global Infrastructure Partners. The project currently has 720 megawatts of installed capacity, and aims to generate a total of 1550 megawatts of power.

Google and Citi have committed $110 million to a large-scale California wind farm being built by Terra-Gen Power, a renewable energy developer backed by Global Infrastructure Partners (GIP).

Citi and Google have each committed $55 million to the wind farm, called the Alta Wind Energy Centre. The financing is structured as a leveraged lease, meaning that Citi and Google will purchase projects at the start of their commercial operations and then lease them back to Terra-Gen under long-term agreements, according to a statement.

The Alta Wind Energy Centre aims to have enough capacity to power 450,000 US homes. The project currently has installed capacity of 720 megawatts and Terra-Gen plans to add another 300 megawatts by the end of the year.  All of the farm’s projected 1,550 megawatt capacity will be supplied to utility Southern California Edison under a power purchase agreement signed in 2006.

GIP is a co-owner of Terra-Gen with  Boston-based energy investor ArcLight Capital Partners. GIP acquired a 40 percent stake in Terra-Gen from ArcLight in 2009. GIP's bought its stake in Terra-Gen in the form of convertible preferred shares with possibility of converting them to equity when the wind energy projects became fully operational.

In addition to wind power, Terra-Gen develops solar and geothermal energy projects in the Western US.  The company has projects with capacity of 5,000 megawatts  under development, according to a statement.

Google said that, following this investment, it will have committed $400 million to clean energy. The Mountain View, California-based internet and technology giant recently made a $168 million commitment to the Ivanpah Solar Project in California, which is being built by BrightSource Energy, a developer backed by the California State Teachers’ Retirement System, Morgan Stanley, Chevron and others. 

Google also recently made its first investment in European clean energy, committing €3.5 million to acquire a 49 percent stake in a solar energy project in Brandenburg, Germany from Hamburg-based private equity firm Capital Stage.

The investments are part of Google’s “going green” initiative, a set of steps the company is taking to “build a more sustainable future”, according to its official blog.