Northland Power Income Fund
TSX : NPI.UN
TSX : NPI.DB

Northland Power Income Fund

September 24, 2009 16:38 ET

Northland Power to Build $145 Million Peaking Plant in Saskatchewan

TORONTO, ONTARIO--(Marketwire - Sept. 24, 2009) -

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Northland Power Income Fund (the "Fund") (TSX:NPI.UN)(TSX:NPI.DB) announced today that a wholly-owned subsidiary has entered into a 25-year Power Purchase Agreement (PPA) with the Saskatchewan Power Corporation to provide peaking power to the Saskatchewan energy system. The PPA was awarded to Northland Power Inc., the Fund's recently acquired subsidiary, following a successful bid in SaskPower's Request for Proposals to provide between 80 and 110 MW of peaking power.

The 86 megawatt natural-gas-fired peaking plant will be built near Spy Hill, Saskatchewan, about 200 km east of Regina. All power produced by the plant will be sold under the PPA to SaskPower. The plant will use two General Electric LM 6000 gas turbines to produce the electricity and will be situated on land leased from SaskPower. Construction is expected to begin in June 2010, and the plant is scheduled to begin commercial operations no later than December 1, 2011. The total cost of the project is approximately $145 million.

"We are very pleased that SaskPower has shown its confidence in Northland Power to enter into this important contract", said John Brace, CEO of the Fund. "We will meet SaskPower's requirements for a reliable peaking plant that will provide needed support and capacity for the province's electrical system. Saskatchewan's energy needs are growing rapidly, and we are excited by the opportunity to work with such a respected partner as SaskPower in responding to these needs."

Under the PPA, the project will receive monthly payments that are designed to cover all fixed costs and investment returns. The PPA also provides protection against changes in the market price of natural gas, as fuel costs are passed through to SaskPower. Northland Power will be responsible for operating the plant to achieve specified efficiency and reliability levels. The contractual structure of the project is designed to ensure predictable, stable and sustainable cash flows over the entire 25-year term of the PPA.

"The Trustees and management of the Fund are particularly pleased that this project has been selected by SaskPower. This win confirms the quality of Northland Power Inc.'s development pipeline acquired by the Fund in its merger with NPI in July of this year. We are confident this is only the first of many excellent opportunities to grow and strengthen the Fund through greenfield development of new, quality assets" said John Turner, Lead Trustee.

ABOUT THE FUND

Northland Power Income Fund is a Canadian income trust that indirectly has ownership or economic interests in 10 power projects totaling over 1,100 megawatts ("MWs") (net 872 MWs). The Fund's assets comprise natural-gas-fired plants which efficiently and cleanly produce electricity and steam as well as facilities generating renewable energy from wind and biomass. Sales are made almost entirely under long-term contracts with a current average duration of 14 years. The Fund's plants are located in Canada, the United States and Germany. The merger with NPI on July 16, 2009 internalized management and provided the Fund with the ability to grow organically by generating its own development opportunities, as well as bringing in NPI's 3,600 MW pipeline of high-quality development prospects.

The Fund's trust units and convertible debentures, which trade on the Toronto Stock Exchange under the symbols NPI.UN and NPI.DB respectively, are qualified investments for RRSPs and DPSPs under the Canadian Income Tax Act. The Fund has in place a distribution re-investment plan that allows Unitholders who are residents of Canada to automatically have their monthly cash distributions reinvested in additional units. Participants do not pay any costs associated with the plan, including brokerage commissions. For further information or to join the plan, contact your financial advisor or broker.

FORWARD LOOKING STATEMENTS

Certain statements in this news release, other than statements of historical fact, are forward looking statements based on certain assumptions and reflect the Fund's and its subsidiaries' current expectations. Forward-looking statements are provided for the purpose of presenting information about management's current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements may include, without limitation, statements regarding the operations, business, financial condition, priorities, ongoing objectives, strategies and outlook of the Fund's and its subsidiaries' for the current fiscal year and subsequent periods. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "plans", "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". This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including the perception of historical trends, current conditions and expected future developments, as well as other factors 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, including those set out in the management's discussion and analysis section of the Fund's 2008 annual report, the Fund's Annual Information Form dated March 13, 2009, the Fund's Management Information Circular dated May 1, 2009, and the Supplement to the Management Information Circular dated July 10, 2009 certain of which are beyond management's control. The Fund'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, or what benefits, including the amount of distributions, the Fund and Unitholders will derive therefrom.

Contact Information

  • Northland Power Income Fund
    John Brace
    President & Chief Executive Officer
    416-962-6262 x 115
    or
    Northland Power Income Fund
    Boris Balan
    Director, Communications & Business Development
    416-962-6262 x 116
    or
    Northland Power Income Fund
    Barb Bokla
    Manager, Investor Relations
    416-962-6262 x156
    416-962-6266 (FAX)
    info@NPIFund.com
    www.NPIFund.com