Wind Energy Projects

Overview

Osler understands what is involved to get (and keep) your wind energy project up and running. We have an intimate knowledge of wind energy legislation and regulatory requirements, and have helped clients in the development, financing and operation of more than 2,000 MW of on-shore and off-shore wind farm projects in Canada and worldwide.

Our team members are trusted advisors who will support you at every step of your project, large or small, from the assessment phase through to operation. We have been in the trenches alongside clients in difficult negotiations on the terms of power purchase agreements (PPAs), including curtailment and market evolution discussions. We also have extensive experience in negotiating shared transmission line co-ownership arrangements and partnership agreements with joint venturers and Aboriginal groups, developing construction contracting structures and negotiating the underlying contracts with turbine suppliers and general contractors to work together. We also assist in securing equity and debt financing.

Our wind energy lawyers have worked in virtually every province in Canada and have reviewed, commented on or negotiated various provincial PPAs issued by the Independent Electricity System Operator (IESO), Hydro-Québec, Nova Scotia Power Inc., B.C. Hydro, Saskatchewan Hydro and Manitoba Hydro.

How we leverage our expertise to help you realize your wind energy project

 

 

Energy (Electrical Power)Energy and capacity markets

Back to the chart
   

Canadian power markets have been increasingly providing the private sector with opportunities to develop projects in the electricity sector, largely in generation and, more recently, transmission. However, the primary challenge has always been providing sufficient long-term regulatory and commercial certainty to foster investment, including through PPAs, capacity markets, carbon credits or other financeable mechanisms.

With our experience acting for public agencies in the electricity sector, we are well positioned to advise independent power producers and other private sector participants, especially U.S. and international investors looking for long-term contracted opportunities in Canada. Almost 15 years ago, we advised the Ontario Ministry of Energy in its development of the seminal 300 MW RFP and RES I contracts, and later advised the Ontario Power Authority (OPA) on its creation and later development of the Feed-in-Tariff (FIT) Program and form of FIT Contract. We currently advise the Ontario IESO on a number of current matters in the Ontario marketplace, including non-utility generators and greenhouse gas credits.

Attention is currently focused on the government of Alberta’s Climate Leadership Plan which includes a carbon tax and a target that entails approximately 5,000 MW of renewable energy sources to make up at least 30% of Alberta’s electricity production by 2030 (among other policies) through their Renewable Electricity Program, as part of Alberta’s initiative to phase-out coal production. We are bringing our experience to bear on understanding the commercial terms and dynamics of the upcoming auction process for the first round of contracts to be offered by the Alberta Electricity System Operator.

 

 

Real EstateDue diligence, documents and title insurance

Back to the chart
   

Given the large expanses of wind farms and ancillary infrastructure, such as switching stations and substations, it is absolutely critical for wind project developers to obtain the appropriate rights from all required parties. Unfortunately, we have seen developers having to go back to landowners to request a “re-do” on their land leases because they did not contain sufficient rights to support the normal development and operation of the wind farm. Generally, larger wind farms (e.g., 100 MW +) have greater risks of title and contiguity issues and will usually involve interfaces with municipalities for road and other land use, as well as additional utilities and services. The land rights may also include a combination of land lease agreements, easements and fee simple land ownership. In addition, these issues may necessitate utility crossing agreements and utility relocation agreements related to railways and other infrastructures with a variety of counterparties with differing interests.

We have excellent working relationships with title insurance companies and their underwriters, and can assist you in properly planning your project. We can also help you with your due diligence requirements to identify deficiencies and wrap property interests as a whole into a cohesive, comprehensive package.

 

 

Construction and InfrastructureConstruction, interconnection and equipment contracts

Back to the chart
   

The days of full-wrap construction contracts for large energy projects are largely gone in Canada. These days, the owner typically splits the scope of the work into two — the purchase of the turbine equipment from the turbine vendor and the contracting of the balance of plant work, including other key pieces of equipment such as transformers — and then needs to link those components as seamlessly as possible. The project then needs to be connected either to a transmission system, a distribution system or a private line that leads to the transmission or distribution system. Managing your project’s critical path and scope as well as potential risks can be a daunting task for both experienced wind energy developers as well as those entering the market.

We have significant experience and expertise in creating effective construction and equipment supply turbine contracts and identifying interface risks and issues, especially with shared transmission lines, and have worked with owners and lenders to deliver effective solutions. We also focus on making the key provisions of the documents consistent with the developer’s obligations under the PPA and the applicable connection agreement with the transmitter or the distributor. As well, our national Construction and Infrastructure Group has significant experience in dealing with international players entering the Canadian market, especially on the construction contracting side, and we know how risks and disputes can play out and should be managed.

Project proponents must be aware of the operation of builder/mechanic lien legislation, including Ontario’s Construction Lien Act, which is in the midst of being significantly reformed. Whether you are an owner or a lender, we can help you understand how wind energy legislation can have an impact on different types of land interests, including Crown lands and Aboriginal lands.

 

 

Aboriginal, Environmental and Regulatory LawApprovals, consultation and Aboriginal partnerships

Back to the chart
   

Aboriginal involvement

Aboriginal involvement in wind farm projects is continuing to grow, and Aboriginal issues are one of the most common sources of regulatory delay and uncertainty for new natural resource development projects in Canada. More importantly, we are seeing increasing numbers of partnerships with Aboriginal groups, and believe that it is crucial for experienced counsel to ensure that the parties enter into arrangements that are realistic and financeable. It’s critical for project proponents to understand the legal requirements and risks associated with Aboriginal and treaty rights and related consultation, and to develop strategies to manage these risks. Our Aboriginal law practitioners advise clients on the duty to consult and the preparation of Aboriginal consultation policies and reports, and negotiate and develop impact benefit agreements. We can help you create a successful Aboriginal strategy and stay up to date on major developments as Aboriginal law in Canada continues to evolve.

Environmental issues and guidelines

It’s important to anticipate and address environmental concerns early on in order to avoid potential setbacks that can threaten project completion. Our environmental experts can help you address environmental requirements during the siting, construction and operation of your project and obtain the appropriate approvals. We have experience with environmental issues relating to wind farm development and operation, including compliance with Renewable Energy Approvals and other permits, and on-going monitoring plans. Our team is also committed to keeping clients up to date on wind energy guidelines and directives as they are issued.

Evolving wind energy regulations

As the renewable energy industry continues to evolve, so do the legal and regulatory requirements associated with the development and financing of renewable energy projects. Our regulatory practitioners have the expertise to help you successfully navigate the complexities of this shifting landscape and address regulatory hurdles, including wind turbine regulations. We are a trusted advisor to organizations, including APPrO on electricity generator and related transmission regulatory issues and power trading and utility regulation, and have appeared in front of the Ontario Energy Board and the National Energy Board on leaves to construct and other regulatory matters.

 

 

Financial ServicesLenders

Back to the chart
   

The returns on your wind energy project revenue are affected by loan terms, making it vital to understand financing options and prepare due diligence documentation before approaching financing entities. Most of our 2,000 MW portfolio of experience has been financed on a project-finance basis, so we are very familiar with lender requirements, whether terms are considered consistent with market practice and what it takes to get your project successfully financed. This experience naturally supports our thinking on all of the material project documents as they are developed, from a PPA to a balance of plant construction contract. In addition, we can review or develop your term sheet in the context of bank or bond financings as needed. We also see around corners on the inevitable teething issues and events that occur in the operational life of the project and the times where lender consent may be needed, and build them in to the credit agreement from day one.

 

 

CorporateStructuring of project partnerships; M&A activity

Back to the chart
   

The structuring of wind farm project entities can be complex, particularly in multi-party joint venture projects. It is critical to establish clear rules between partners for project governance as well as to enable them to eventually exit the project. Further complexities can arise when additional partners such as municipal corporations and Aboriginal groups take an ownership stake in a wind farm project and have particular interests that need to be protected. We have successfully advised on many of these arrangements in the Ontario marketplace and elsewhere, with input from our corporate and tax colleagues.

As well, the pace of mergers and acquisitions in the Canadian renewable energy market is increasing, as many project sponsors eventually seek to exit or monetize their project interest after commercial operation is achieved. We are adept at structuring the project partnership documents to anticipate this and building in the necessary flexibility. We have acted for both sellers and acquirers of several wind farm projects, and are well positioned to assist by drawing on the expertise of our industry-leading M&A practice.

 


 

For more information about wind energy development and how we can assist you in realizing your wind energy project, contact Richard Wong (Toronto) or Paula Olexiuk (Calgary).

 

DownloadDownload

Related Expertise

Richard Wong

Partner, Commercial
Toronto

Paula Olexiuk

Partner, Energy
Calgary
  • TransAlta Renewables Inc.

    The underwriters in the $150 million bought deal offering of TransAlta Renewables Inc. common shares by way of a prospectus supplement filed on June 15, 2018.

  • Henvey Inlet Wind LP

    Henvey Inlet Wind LP in the $1 billion financing and construction of the Henvey Inlet Wind Farm

  • Pattern Energy Group and Samsung Renewable Energy

    Acting for the joint ventures of Pattern Energy Group and Samsung Renewable Energy in the development, equipment supply, and construction of wind power projects under the historic Green Energy Investment Act. These projects are among the largest in Ontario, and include the South Kent Wind Farm (270 MW), K2 Wind Farm with Capital Power (270 MW), Armow Wind Farm (180 MW) and the Grand Renewable Wind Farm and shared transmission line (150 MW).

  • Northland Power

    Acting for Northland Power on the development, equipment supply and construction of several of its wind power projects, including McLean’s Mountain (60 MW), Grand Bend (100 MW), and Frampton (24 MW) in Ontario and Québec, Project Gemini (a 600 MW off-shore wind farm located in the Dutch North Sea), and Project Nordsee (Phase One 332 MW, with additional early stage development projects) located in German territorial waters.

  • Greengate Power Corporation

    Acted for Greengate Power Corporation on the sale of its construction-ready 300 MW Blackspring Ridge wind power project in Alberta to EDF and Enbridge which, when operational, will be the largest wind power project in western Canada, and on the sale of its 150 MW Halkirk wind power project.

  • Deutsche Bank Securities

    Acted for Deutsche Bank Securities on the financing of the Kruger 101.2 MW Montérégie Wind Farm in Québec.

  • Hydro-Quebec

    Acting for various participants and partners in Hydro-Quebec Distribution’s A/O 2013-01 currently underway

  • Firelight Infrastructure Partners L.P.

    Firelight Infrastructure Partners L.P. on the equity financing for the 34 MW Amherst wind farm in Nova Scotia being developed in partnership with Sprott Power, on the equity financing for the 24 MW Ostrander Point wind farm in Ontario being developed in partnership with Gilead Power, on all development and operational aspects of the 51 MW Dalhousie Mountain wind farm project in Dalhousie, Nova Scotia and on all aspects of the acquisition and development by its affiliate,Firelight Solar L.P.

  • M.A. Mortenson Company 

    M.A. Mortenson Company on the EPC contract for Enbridge’s Leader Wind Project A and Project B in Kincardine, Ontario (100 MW and 99 MW wind power projects).

  • Enbridge Income Fund

    Enbridge Income Fund on the acquisition of three wind power projects (71 MW) in Western Canada: SunBridge, Magrath and Chin Chute.

  • Find More