Innergex and MMBC Sign a 30-year power purchase agreement with Hydro-Québec
- Signature of a 30-year “take-or-pay” power purchase agreement indexed to 30% inflation with Hydro-Québec for the electricity to be produced by the Mesgi’g Ugju’s’n 2 wind project
- Marks a significant milestone in the progression of the project
- Second project led by a 50-50 partnership between the three Mi’gmaq communities in Quebec and Innergex, following the success of the 150 MW Mesgi’g Ugju’s’n wind facility commissioned in 2016
LONGUEUIL, Quebec, May 31, 2023 – Innergex Renewable Energy Inc. (TSX: INE) (“Innergex” or the “Corporation”) and Mi’gmawei Mawiomi Business Corporation (“MMBC”) are pleased to announce the signature of a 30-year “take-or-pay” power purchase agreement indexed to 30% inflation with Hydro-Québec for the electricity to be produced by Mesgi’g Ugju’s’n 2 (“MU2”).
Mesgi’g Ugju’s’n 2 is a 102 MW wind project to be located in the MRC d’Avignon and an extension to the existing 150 MW Mesgi’g Ugju’s’n wind facility commissioned in 2016. MU2 is the result of a 50-50 renewed partnership between Innergex and the three Mi’gmaq communities in Quebec – Gesgapegiag, Gespeg and Listuguj – represented by MMBC. Its commissioning is scheduled in 2026.
“The signing of this long-term power purchase agreement with Hydro-Québec enables the project to move ahead by guaranteeing revenues over the span of 30 years,” said Michel Letellier, President and Chief Executive Officer of Innergex. “With the new financial initiatives announced by the Government of Canada to foster a clean economy, we expect the Canadian market to continue to bloom with exciting new opportunities for renewable energy. With projects like Mesgi’g Ugju’s’n 2, local communities, and especially Indigenous communities, are bound to benefit from this incredible future growth, as renewable energy projects are known to bring direct social and economic benefits to the region in which they are developed.”
“This milestone in the development of Mesgi’g Ugju’s’n 2 guarantees sustainability by securing recurrent revenues and jobs for our communities for the next 30 years,” said Frédéric Vicaire, Chief Executive Officer of MMBC. “Through job creation or self-generated income, our partnership with Innergex aims to produce wealth. It demonstrates our determination to follow a clear path in the sustainable exploitation of our natural resources and the production of renewable energies, thus being a leader in the fight against climate change. Our three communities are proud of this achievement, and hope to inspire other First Nations across Canada to develop similar initiatives.”
On March 15, 2023, the MU2 wind project was selected in Hydro-Québec’s request for proposals. The project will contribute to support the wind industry supply chain in the Gaspé Peninsula and Quebec. MU2 should also provide an annual financial contribution and set up a social commitment fund to support development initiatives with local municipalities.
The construction of the MU2 wind farm will involve the participation of local and regional businesses. The construction alone will require the creation of approximately 200 jobs during its peak period, while long-term, permanent and qualified jobs will also be created during operations.
Interconnection costs and collector system will be reimbursed by Hydro-Québec at the commissioning of the facility. Project costs are estimated at approximately $277.4 million which are expected to be financed with approximately 75% to 80% of long-term, non-recourse project debt and the remaining will be funded by sponsor equity to be shared equally among the partners.
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