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NextEra Energy to sell Canadian wind and solar assets to CPPIB for $582m

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NextEra Energy Partners has signed an agreement to divest 396MW of fully contracted wind and solar generation assets in Canada, to Canada Pension Plan Investment Board for $741m.

Developed and operated by the affiliates of NextEra Energy Partners, the projects include four wind and two solar farms located in Ontario, Canada. They have an average contract life of approximately 16 years.

As per the deal, CPPIB will purchase the 59.9MW Bluewater wind farm , 22.9MW Conestogo wind farm; 149MW Jericho wind farm; 124.4MW Summerhaven wind farm; 20MW Moore solar project; and 20MW Sombra solar farm.

CPPIB managing director and power and renewables head Bruce Hogg said: “This opportunity to acquire a sizeable portfolio of operating renewables projects provides immediate scale and exposure to a core sector for CPPIB’s broader North American and global power and renewables strategy.

“NextEra Energy Partners is an industry-leading renewables developer and operator. We look forward to working together with them to support continued strong performance from these projects.”

The projects, however, will continue to be operated by the affiliate of NextEra Energy Resources, under a long-term services agreement with CPPIB.

NextEra Energy Partners chairman and CEO Jim Robo said: "The sale of these assets, at a very attractive 10-year average CAFD yield of 6.6%, including the present value of the O&M origination fee, highlights the underlying strength of the partnership's renewable portfolio."

Subject to regulatory approval, the deal is expected to be closed in the second quarter of this year.

The transaction represents CPPIB’s third significant investment in the global renewables sector.

In December last year, Canada Pension Plan Investment Board and Votorantim Energia had agreed to form a joint venture to acquire two operational wind farms in Brazil, totaling 565MW.

For this joint venture, CPPIB has committed an initial investment of R$ 690m.