Northland Power Inc. ("Northland Power") announces the successful execution of an Energy Storage Facility Agreement (ESFA) with the Independent Electricity System Operator ("IESO") for the Oneida Energy Storage Project ("the Project"). The Project will benefit from a 20-year fixed price contract for revenue payments with the IESO in Ontario for the majority of the capacity from the project. The remaining capacity will earn market revenues through sales into the wholesale market. Execution of the ESFA follows the issuance of a Ministerial Directive to enable the Project to proceed, granted by the Government of Ontario.
The news builds on last week's announcement confirming Northland's investment in the Project and marks a significant milestone for advancing its development in partnership with NRStor Inc. (NRStor) and the Six Nations of the Grand River Development Corporation (SNGRDC). Northland is a majority owner in the Project and will lead its construction, financing, and operation.
The Project has finalized a Battery Supply Agreement and a long-term Service Agreement with Tesla Inc. for the supply of key components and services, as well as an EPC agreement with Aecon Group Inc. for designing, engineering and constructing the facility.
The Canada Infrastructure Bank (CIB) has played a key role supporting project development and is collaborating with the Oneida Energy Storage Project on an investment agreement. In addition to the CIB, Northland and its partners are also working with commercial banks to complete financing of the project. Furthermore, Natural Resources Canada has provided $50 million in funding from the Smart Renewables and Electrification Pathways program, recognizing that the Project will reduce greenhouse gas emissions by enabling increased renewable energy capacity and providing essential grid services. The Project will contribute to Canada's ongoing transition to a net-zero economy by 2050 as well as Canada's commitment to achieving a 100-percent net-zero-emitting electricity system by 2035.
The Project is the largest battery energy storage project in Canada and amongst the largest in the world. It will deliver critical capacity and improved efficiency to Ontario's energy grid and will double the amount of energy storage resources on Ontario's clean electricity grid from approximately 225 MW today to approximately 475 MW when the Project is completed in 2025.
"The Oneida Energy Storage Project is a milestone for Ontario's burgeoning energy storage sector. For Northland, this project marks our first storage investment. As trusted and experienced operators in Canada, the opportunity to construct and operate Canada's largest battery energy storage project holds special significance," said Mike Crawley, President and CEO of Northland Power. "We recognize the Government of Canada and the Government of Ontario for their continued support of Oneida as part of their broader vision to ensure reliable and affordable clean energy for Canadians. We're excited to be a part of this growth and look forward to continuing to work in partnership with NRStor and the Six Nations of the Grand River Development Corporation."
About Northland Power
Northland Power is a global power producer dedicated to helping the clean energy transition by producing electricity from clean renewable resources. Founded in 1987, Northland has a long history of developing, building, owning and operating clean and green power infrastructure assets and is a global leader in offshore wind. In addition, Northland owns and manages a diversified generation mix including onshore renewables, efficient natural gas energy, as well as supplying energy through a regulated utility.
Headquartered in Toronto, Canada, with global offices in eight countries, Northland owns or has an economic interest in 3.0 GW (net 2.6 GW) of operating capacity. The Company also has a significant inventory of projects in construction and in various stages of development encompassing over 20 GW of potential capacity.
Publicly traded since 1997, Northland's common shares, Series 1 and Series 2 preferred shares trade on the Toronto Stock Exchange under the symbols NPI, NPI.PR.A and NPI.PR.B respectively.
FORWARD-LOOKING STATEMENTS
This press release contains statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements") that are provided for the purpose of presenting information about management's current expectations and plans. Readers are cautioned that such statements may not be appropriate for other purposes. Northland's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, the events anticipated by the forward-looking statements may or may not transpire or occur. Forward-looking statements include statements that are not historical facts and are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects," "anticipates," "plans," "predicts," "believes," "estimates," "intends," "targets," "projects," "forecasts" or negative versions thereof and other similar expressions or future or conditional verbs such as "may," "will," "should," "would" and "could." These statements may include, without limitation, statements regarding future Adjusted EBITDA, Adjusted Free Cash Flow and Free Cash Flow, respective per share amounts, dividend payments and dividend payout ratios, guidance, the timing for the completion of construction, acquisitions, dispositions, investments or financings, attainment of commercial operations, the potential for future production from project pipelines, cost and output of development projects, litigation claims, plans for raising capital, and the future operations, business, financial condition, financial results, priorities, ongoing objectives, strategies and the outlook of Northland and its subsidiaries. These statements are based upon certain material factors or assumptions that were applied in developing the forward-looking statements, including the design specifications of development projects, the provisions of contracts to which Northland or a subsidiary is a party, management's current plans and its perception of historical trends, current conditions and expected future developments, as well as other factors, estimates and assumptions that are believed to be appropriate in the circumstances. Although these forward-looking statements are based upon management's current reasonable expectations and assumptions, they are subject to numerous risks and uncertainties. Some of the factors include, but are not limited to, risks associated with sales contracts, Northland's reliance on the performance of its offshore wind facilities at Gemini, Nordsee One and Deutsche Bucht for approximately 50% of its Adjusted EBITDA, counterparty risks, contractual operating performance, variability of sales from generating facilities powered by intermittent renewable resources, offshore wind concentration, natural gas and power market risks, operational risks, recovery of utility operating costs, Northland's ability to resolve issues/delays with the relevant regulatory and/or government authorities, permitting, construction risks, project development risks, acquisition risks, financing risks, disposition and joint-venture risks, interest rate and refinancing risks, liquidity risk, inflation risks, impact of regional or global conflicts, credit rating risk, currency fluctuation risk, variability of cash flow and potential impact on dividends, taxation, natural events, environmental risks, health and worker safety risks, market compliance risk, government regulations and policy risks, utility rate regulation risks, international activities, reliance on information technology, labour relations, reputational risk, insurance risk, risks relating to co-ownership, bribery and corruption risk, legal contingencies, and the other factors described in the "Risks Factors" section of Northland's Management's Discussion and Analysis and Annual Information Form for the year ended December 31, 2021, which can be found at www.sedar.com under Northland's profile and on Northland's website at northlandpower.com. Northland has attempted to identify important factors that could cause actual results to materially differ from current expectations, however, there may be other factors that cause actual results to differ materially from such expectations. Northland's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur and Northland cautions you not to place undue reliance upon any such forward-looking statements.
The forward-looking statements contained in this release are, unless otherwise indicated, stated as of the date hereof and are based on assumptions that were considered reasonable as of the date hereof. Other than as specifically required by law, Northland undertakes no obligation to update any forward-looking statements to reflect events or circumstances after such date or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.
For further information, please contact:
Investor Relations
Wassem Khalil, Senior Director, Investor Relations
647-288-1019
investorrelations@northlandpower.com
Corporate Communications
Jessica Kitchen, Manager, Global Communications
905-302-2714
jessica.kitchen@northlandpower.com
