The Challenge: Acquisition of a Wind Energy Power Plant

To take advantage of an acquisition opportunity, our client, a power generation investment firm, contacted ScottMadden to support the diligence of an in-development utility-scale wind energy power plant. The asset had run into permitting issues and was at risk of being discontinued. Our client, who had extensive power generation permitting experience, hoped to buy the plant at a discount, resolve the issues, and divest the asset for a multiple of the original
cost. Our consultants were brought in to validate the bid price and guide the purchasing strategy.

The Consulting Process

• Engagement of our network at leading electric power, utility, and renewable energy firms to benchmark various utility-scale wind energy project costs in the market
• Performance of financial sensitivity analysis for the project’s return on investment and yield metrics
• Identification of a variety of bidding strategies that offered different “win-win” scenarios for both our client and the developer offering the asset

The Results Achieved

• We evaluated the bid and made the recommendation to expand the current bid to include both the power plant and the 10,000+ acres of land on which the asset was being developed
• This enabled our client to create additional revenue streams by owning both the wind asset and land through avenues such as lease payments and
  mineral mining
• Ultimately, with the support of our consultants, the proposed bid was accepted by the developer