Northland Power Income Fund

Northland Power Income Fund

September 20, 2007 14:30 ET

Northland Power Income Fund and Northland Power Inc. Submit Six Bids for 750 Megawatts in Response to Hydro-Quebec Wind-Power Request for Proposals

TORONTO, ONTARIO--(Marketwire - Sept. 20, 2007) -


Northland Power Income Fund (the "Fund") (TSX:NPI.UN) (TSX:NPI.DB) announced today that it and Northland Power Inc. have jointly submitted five non-binding bids totaling approximately 450 megawatts ("MW") and a sixth for a 300 MW project in association with Energie Eolienne Pessamit SEC (owned by the Pessamit First Nation) in response to Hydro-Quebec's RFP for wind power projects in the province of Quebec. Northland Power Inc. is the parent company of the Fund's manager. Hydro-Quebec has announced that it received bids for 66 projects totaling some 7,700 MW.

Northland Power Inc. will assume the lead role and bear all the costs required to confirm the viability of any projects selected by Hydro-Quebec. Northland Power Inc. will obtain the environmental and other required permits, and negotiate the project agreements, notably the long-term power purchase agreement(s) with Hydro-Quebec, and will offer the Fund the opportunity to acquire an equity interest once the successful projects have completed pre-construction development. Any investment by the Fund will be subject to the project(s) meeting the Fund's investment criteria and the approval of the Board of Trustees of NPIF Commercial Trust.

The Fund and Northland Power Inc.'s bids provide for project start dates as soon as December 2011 and as late as December 2015, depending on Hydro-Quebec's needs. The notification of successful bidders by Hydro-Quebec is scheduled for February 2008 and the execution of long-term power purchase agreements for May 2008. Any investment by the Fund, if approved by the trustees, is not likely to occur until 2010 at the earliest.

"We believe that wind power makes sense in Quebec, and can be a good investment for the Fund," stated John Brace, the CEO of Northland Power Inc. and of the Fund. "Wind power can be competitive with other electricity sources in areas that combine a good wind resource with a flexible power system, such as Hydro-Quebec's, that has alternative sources of electricity when the wind is not blowing." Northland Power Inc. executed two power purchase agreements with Hydro-Quebec in 2005 totaling 250 MW for projects that it expects to construct and achieve commercial operation in 2009 (150 MW - Jardin d'Eole) and 2010 (100 MW - Mont-Louis.)

The Fund currently owns the 54 MW Mont Miller wind farm in the Gaspesie region of Quebec that has supplied electricity to Hydro-Quebec since it went commercial in 2005 under the terms of a 21-year power purchase agreement. The Fund also owns two wind farms in Germany with a total capacity of 21.5 MW that sell electricity to regional power utilities under the provisions of German renewable energy legislation.

In addition to its wind power investments, Northland Power Income Fund indirectly owns interests in three natural gas-fired combined-cycle cogeneration power plants that efficiently and cleanly produce electricity and steam for sale. Two cogeneration plants are located in Ontario - the 120 MW Iroquois Falls facility and the 110 MW Kingston facility - and are owned 100% by the Fund. Through its 19% equity interest in Panda Energy Corp. (PEC) and loan to a PEC subsidiary, the Fund has an interest in the 230 MW Panda-Brandywine cogeneration plant located outside Washington, D.C. Electricity produced from the cogeneration plants is sold under long-term power purchase agreements (PPAs) with creditworthy entities to ensure revenue stability, and long-term contracts assure the supply and price of natural gas, which is the Fund's largest cost. The Fund has committed to provide $30 million as subordinated debt to Northland Power Inc.'s 265 MW Thorold Cogeneration Project that is under construction near the Town of Thorold, Ontario.

The Fund's units trade on the Toronto Stock Exchange under the symbol NPI.UN. The units are qualified investments, and are not considered foreign property for RRSPs and DPSPs under the Canadian Income Tax Act.

Forward-looking Statements

The disclosure above contains certain forward-looking statements. Although these forward-looking statements are based upon Northland Power Income Fund's Manager'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 2006 annual report and in the Fund's Annual Information Form dated March 30, 2007, certain of which are beyond the Manager's control. For this purpose, any statements that are contained herein that are not statements of historical fact may be forward-looking statements. 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 Management Inc.
    Barb Bokla
    Manager, Investor Relations
    (416) 962-6262 x156
    (416) 962-6266 (FAX)
    Northland Power Income Fund Management Inc.
    Boris Balan
    Director of Communications
    (416) 962-6262 x116
    (416) 962-6266 (FAX)