EverPower is a US wind energy development and management company
EverPower is a top 20 US wind energy development and generation company with a significant portfolio of assets in the Northeast and West Coast power markets. The business was acquired by Terra Firma in November 2009.
Asset-Backed: EverPower has seven operating wind farms with a total of 752 MW of generating capacity. Wind farms are an infrastructure-type asset class, with established channels of project financing and the possibility of long-term power contracts.
Requiring Fundamental Change: The financial crisis was a difficult period for the wind power sector, leaving many companies under-capitalised and unable to finance their development plans. This offered an opportunity to enter the market at a low point in the cycle, bring a disciplined approach to construction and development costs and to take advantage of the distressed market to pursue further acquisitions to generate scale.
- Since acquisition, EverPower has been transformed from a development-focused business into a growth-oriented, high quality developer, and utility-scale owner and operator of wind generation assets.
- The commercial side of the business has been positioned to maximise value through a combination of long-term power purchase agreements and merchant trading positions. In this way, the business is well-positioned to benefit from potential rises in the price of power and Renewable Energy Certificates while also managing any potential downside risks.
- EverPower’s organisation reflects the current priorities and activity level of the business, with capabilities across all the critical operational functions – development, procurement, construction, maintenance, commercial and finance. This has been achieved by supplementing the original management with selective hires to broaden and deepen the team, and by putting in place an appropriate incentive scheme to ensure alignment.
- The company has also been professionalised through the establishment of an appropriate board, governance, and organisational structure. New senior level appointments have included a Chairman, Non-Executive Directors and a Commercial Director.
Developing through capital expenditure
- Since the original acquisition, more than $500 million has been invested in the construction of pipeline assets. This has allowed EverPower, through both a targeted procurement programme and well-established relationships with all major suppliers, to build out the portfolio quickly and at low cost. EverPower has seven best-in-class operating wind farms, of which four were built and put in operation under Terra Firma’s ownership, and two were acquired.
Building through mergers and acquisitions
- Terra Firma has built EverPower into a renewable energy generator of significant scale with a generating capacity of 752 MW. Along with building out four sites from the development pipeline, Terra Firma has focused on growing the business through acquisitions. In 2012, EverPower purchased the 150 MW Mustang Hills wind farm in California. In 2014, it acquired the 240 MW Big Sky wind farm in Illinois.
Lowering the cost of capital to create extra upside
- Through rapidly and efficiently building out the portfolio, EverPower has received US Government cash grants on all the projects it has constructed, which effectively lowers the cost of capital. Working with Terra Firma and leveraging the team’s relationships and expertise, the business has put in place low-cost, competitive construction and project financings at attractive levels. The team has also successfully led the execution of privately placed long-term debt and will continue to seek to optimise the balance sheet.
Status of Investment: The EverPower investment is unrealised.