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Boralex closes $608M financing for 200MW Quebec wind farm

Project will produce enough power for 40,000 homes

Renewable project developer Boralex Inc. (BLX-T) and Parc éolien Apuiat S.E.C. have closed on $608 million in financing led by Desjardins Group for the 200-megawatt Apuiat wind farm on Quebec’s North Shore.

Boralex, based in Kingsey Falls, Que., formed Apuiat S.E.C. with its Innu Nation community partners to develop and operate the Apuiat wind farm and share an equal stake.

The wind energy project will supply enough clean electricity to power 40,000 homes in Québec.

“The financing announced today shows the strength of our company, as well as attesting to the quality of the Apuiat project,” Bruno Guilmette, executive vice president and CFO of Boralex, said in a release.

“The construction of the Apuiat project marks the beginning of a period of strong growth for Quebec’s wind power, in which Boralex intends to strongly contribute by leveraging its vast experience as an energy asset developer and operator."

Financing the Apuiat wind farm

Long-term financing for the wind farm was secured by the Desjardins Group, the coordinating lead arranger and agent for a banking syndicate consisting of Spain's CaixaBank, Germany's DZ Bank AG and South Korea's Korea Development Bank.

Vancouver-based Selkirk Advisory Group served as financial advisor.

The $608 million in financing is broken down into:

  • a $465.3 million construction loan to be converted to a term loan with a 25-year term after the start of commercial operation, scheduled for the second half of 2024, with an “advantageous interest rate”; and
  • short-term facilities totalling $142.7 million, including a bridge loan and a letter of credit facility to finance costs incurred during construction that are reimbursable by Hydro-Québec and issuing various letters of credit.

Boralex said a “significant” portion of the long-term financing component holds interest at a rate fixed under an interest rate hedging arrangement.

The debt’s interest rate risk is covered by an ESG swap which includes a cash-back designed by Desjardins. This will reward achievement of ESG performance indicators with cash paid back to the project partners.

The bridge loan in the short-term facilities will “reduce the amount of equity attributed to the project in the short term, thereby optimizing the overall capital structure of Boralex and the Innu,” the Boralex release states.

A federal government news release from March said the Apuiat project will create almost 300 jobs during construction and 10 permanent jobs for the wind farm’s operations.

Boralex said the Apuiat wind farm will be the first wind farm on the North Shore.

Commissioning is expected in December 2024, and the wind farm will be held under a 30-year term contract.

About the companies involved

Boralex is a wind, solar, hydroelectric and energy storage project developer with an installed capacity of three gigawatts developed over the past five years. Its development portfolio totals 6.2 gigawatts in wind, solar and storage projects.

Its finished wind projects in Quebec include the 135.7-megawatt Des Moulins 1, the 138.6-megawatt Le Plateau I and Seigneurie de Beaupré Wind Farms with a total contracted capacity of 365 megawatts.

Parc éolien Apuiat brings together the Innu communities of Ekuanitshit, Essipit, Pessamit, the Pekuakamiulnuatsh First Nation, Pakua Shipi, Uashat mak Mani-utenam, Matimekush-Lac John, Nutashkuan, and Unamen Shipu to develop the wind farm with Boralex.

The Apuiat project is located on public land of the traditional territory of the Uashat mak Mani-utenam First Nation, according to the Canadian government.

"With the closing of this financing and the progress of the construction work, we've taken another important step towards the realization of the Apuiat wind farm, which is a first for our Innu communities, and I'm very proud of it," Marc Genest, president of the Apuiat S.E.C., said in the release. "I'd like to thank our financial partners for their trust and support in bringing this project to fruition."

Quebec’s wind energy ambitions

The province has set a goal of quadrupling its wind capacity over the next 15 years, and renewables developers have taken up the call.

In March, Hydro-Quebec approved 1,303 megawatts of installed renewables capacity over seven wind energy projects, followed up with a tender call for 1,500 megawatts of wind power later in the month.

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