Hydro Ottawa was already the largest municipally-owned producer of green energy in Ontario with a generation capacity of 48 megawatts enough to power 40,000 homes a year. The acquisition aligns with Hydro Ottawas 2012-2016 Strategic Direction to increase the utilitys supply of clean energy to customers, and by pursuing low risk opportunities with stable long-term returns. Prior to the acquisition, extensive due diligence was conducted by Hydro Ottawa and BMO Capital Markets was retained as its exclusive financial advisor for the transaction.
Hydro Ottawas renewable energy generation business proved a significant source of revenue for the company in 2014, generating nearly $20 million in revenue.
In the span of three years, Hydro Ottawa has tripled its green generating capacity and diversified its revenue streams. This acquisition comes after the companys 2014 announcement of a 40-year contract with the former Ontario Power Authority now merged with the Independent Electricity System Operator to expand its Chaudière Falls site with a new 29 megawatt facility.
The newly-acquired Ontario assets are connected to the provincial electricity grid, while the assets in New York State provide synergies with Hydro Ottawas existing generation operations due to their close proximity to Ottawa.
This acquisition will have no impact on electricity rates for Hydro Ottawa customers. Hydro Ottawas existing portfolio includes six run-of-the-river hydroelectric generation plants at Chaudière Falls, and majority shares in landfill gas-to-energy facilities at the Trail Road landfill site in Ottawa and the Laflèche landfill site in Moose Creek, Ontario.
The New York State assets have a combined operating capacity of 22.6 megawatts and are located in Lyons Falls, Dolgeville, Philadelphia and Diana.
The Ontario assets have a combined operating capacity of 8.3 megawatts and are located in Ottawa, Rideau Lakes, Kingston 2, Gananoque and South Crosby.
Run-of-the-river hydroelectric facilities have minimal impact on the environment because they dont produce pollution or greenhouse gases. Instead they rely on the natural flow of their water source, and can generate power 24 hours a day, seven days a week, all year long.
We want to increase renewable generation capacity and provide earnings that benefit our shareholder, the City of Ottawa, in an environmentally responsible way. After significant due diligence, risk evaluation, and a thorough technical assessment of all assets, we concluded that this was an excellent business opportunity that wisely builds upon our existing generation assets portfolio," said Bryce Conrad, President and Chief Executive Officer, of Hydro Ottawa.