JPMAM invests in two First Wind projects

JPMorgan Asset Management has acquired majority stakes in Palouse and Route 66, two First Wind projects in Washington and Texas.

Institutional investors advised by JPMorgan Asset Management (JPMAM) have acquired majority stakes in Palouse and Route 66, two wind projects developed and operated by renewable energy company First Wind, the two entities said in a joint statement.

Filings with the Federal Energy Regulatory Commission show that JPMAM-managed infrastructure fund IIF and its subsidiaries will buy a 90 percent stake in the two projects, with First Wind owning the remaining 10 percent.

Neither JPMAM nor First Wind disclosed the percentage acquired in each project nor financial details of the transaction. JPMorgan declined to comment.

The Palouse Wind project, which achieved commercial operation in December 2012, is the largest renewable energy facility in Washington State’s Whitman County. Its 105 megawatts (MW) of capacity, which can power up to 30,000 homes, is sold to and distributed by energy company Avista.

Route 66, near Amarillo, Texas, is currently under construction. Once completed, the project will produce 150MW of clean energy that will be delivered to the ERCOT (Electric Reliability Council of Texas) power markets through the new Competitive Renewable Energy Zone (CREZ) transmission system. Route 66, which is slated for completion in 2015, will power about 49,000 homes annually, according to the statement.

“We are very excited to add the Palouse and Route 66 wind projects to the list of assets we advise and establish a partnership with First Wind on behalf of our clients,” said Matt LeBlanc, chief investment officer of OECD Infrastructure at JPMorgan Asset Management – Global Real Assets.

“These are high quality projects, exhibiting solid financial and operating fundamentals, that we anticipate will produce stable and growing yields and total returns for our investors over the long term,” he added.

Boston-based First Wind, which focuses exclusively on the development, financing, construction, ownership and operation of utility-scale renewable energy projects in the US, will operate and manage both projects.

The independent wind and solar developer, which was equally owned by investment firm D.E. Shaw and mid-market private equity investor Madison Dearborn Partners, was recently sold to SunEdison and its yieldco platform TerraForm Power for $2.4 billion.

“This transaction […] provides First Wind capital to continue our efforts to develop and build new clean energy projects,” First Wind chief executive Paul Gaynor said. According to the statement, First Wind is operating or building projects in the US Northeast, West and Hawaii, with combined capacity of nearly 1,300MW.

Based in New York, JPMorgan Asset Management – Global Real Assets is part of JPMorgan Asset Management’s Alternatives Investments business, which collectively manages over $120 billion in client assets across real assets, hedge funds, credit and private equity.

Its IIF infrastructure platform holds 49.5 percent of Southwest Generation Operating Company, which owns several natural gas-fired generating facilities across the US, as well as a passive, non-controlling interest in Coastal States Wind Holdings, which indirectly owns some 72 megawatts of wind power, according to regulatory filings.

As of September 30, 2014, the Global Real Assets team, which focuses on real estate, maritime/transport and energy in addition to infrastructure, had more than $82 billion in assets under management.

*Bruno Alves contributed to this story.