Chatham-Kent council is hoping for a big return, after approving a nearly $8 million investment into the North Kent 1 Wind Turbine Project.
Municipal council authorized the Municipality to invest $7.74 million into Entegrus Inc. – which is 90% owned by the Municipality – as a common share investment for a 15% equity interest stake into the project.
“It is anticipated that the Municipality will receive incremental dividends of $900,000 to $1 million per annum for the first seven years,” Mike Turner, chief financial officer and treasurer for Chatham-Kent, said in a report.
“The dividend amounts in subsequent years will be lower due to the timing of tax payments on project cash flows. Over the life of the project, total dividends to the Municipality are expected to exceed $17 million.”
The items was passed by council by a vote of 9-5.
Councillors Carmen McGregor, Darrin Caniff, Bryon Fluker, Leon Leclair, Bob Myers, Derek Robertson. Trevor Thompson, Frank Vercouteren and Mayor Randy Hope voted in favour on the motion.
Meanwhile, Councillors Mark Authier, Michael Bondy, David Vandamme, Steve Pinsonneault and Jeff Wesley were opposed. Councillors Brock McGregor, Doug Sulman, Karen Herman and Joe Faas were absent.
Bondy was the only member of council to discuss his opposition during the open council meeting.
“I’m not going to support this based on the principle that I think we have enough wind turbines in our Municipality,” he said.
“Obviously it hasn’t helped out electricity bills.”
Staff says in a report the Province and the Independent Electricity System Operator (IESO) announced the North Kent 1 project was successful in its bid in the large renewable projects initiative back in March 2015.
In April of 2015 the Province and IESO announced a new 20-year contract was executed with North Kent Wind 1 LP.
The 100-MW wind farm is is now scheduled to have financial close by the end of this month, with construction beginning shortly after that date.
With construction being approved by the Province and the IESO, the Municipality negotiated a set of
terms to benefit the citizens of Chatham-Kent.
Council also approved on Monday for Entegrus and the Municipality to complete a detailed financing agreement for ongoing investments, dividend payouts and intercompany debt amounts.
