NRG Yield to Buy Wind and Fuel-Cell Projects, Restructure Stock

(Bloomberg) — NRG Yield Inc., a business created to hold
power-generating assets developed by NRG Energy Inc. and other
companies, agreed to spend about $41 million acquiring a fuel-cell project in Connecticut and majority stakes in two Colorado
wind farms.

NRG Yield is buying the University of Bridgeport Fuel Cell
Project from Danbury, Connecticut-based FuelCell Energy Inc., as
well as positions in Invenergy LLC’s Spring Canyon II and III
wind farms, according to a statement today.

The fuel-cell project has 1.4 megawatts of capacity and has
a 12-year contract to sell power, with an option for a seven-year extension. The two wind farms have a combined capacity of
63 megawatts and are selling electricity to the Platte River
Power Authority under a 25-year contract. Invenergy will
continue to maintain the turbines.

The company, which raised $495 million in its July 2013
initial public offering, “continues to fulfill its promise of a
consistent, predictable and steadily growing stream of cash
flows paid out to our shareholders,” David Crane, NRG Yield’s
chairman and chief executive officer, said in the statement.
Crane is also NRG Energy’s CEO.

NRG Yield, a so-called yieldco, also is planning to
restructure its stock. NRG Yield is proposing to split its Class
A stock into one Class A and one Class C share, and its Class B
into one Class B and one Class D share. The company said the
move would make it easier to raise capital while maintaining
ties to NRG Energy. The shift must be approved by shareholders
in a May 5 vote.

Yieldcos are an increasingly popular business model in the
renewable-energy industry. Under the model, developers create
separate units, the yieldcos, to own and operate power plants.
They usually retain a controlling stake in the new entity, which
uses revenue from selling electricity to pay dividends and help
purchase additional projects.

To contact the reporter on this story:
Justin Doom in New York at
jdoom1@bloomberg.net

To contact the editors responsible for this story:
Reed Landberg at
landberg@bloomberg.net
Will Wade, Steven Frank

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