Developer Eyes California to Buy Canadian Wind Energy

Jan 22, 2007 California Energy Markets

Katabatic Corp. is hoping California will have an interest in buying power generated from the 3,000 MW Banks Island wind project slated for a 120-mile parcel of land along the northwest coast of British Columbia.

Under terms of the deal announced Jan. 12, Katabatic will develop the first 700 MW of the project in the next two years, with an eye to starting construction in early 2009. When fully built, the project could cost roughly $5 billion. The amount of the initial financing, supplied by Deutsche Bank AG, was not disclosed.

Katabatic, which has offices in B.C. and San Francisco, plans to apply for a power-purchase agreement with BC Hydro in the utility's call for tenders, expected later this year.

But a large chunk of the power could find its way to the U.S., and specifically to utilities in California that need to acquire 20 percent of their power from renewables by 2010, Jonathan Raymond, chief operating officer of Katabatic, told California Energy Markets.

"With 3,000 MW, we more than likely will not sell it all to BC Hydro," Raymond said. "So we are looking at other purchase agreements with utilities in Washington, Oregon and California. But we have to solve some transmission issues first."

Pacific Gas & Electric is already exploring building a transmission line into B.C. to import renewable energy from the province and has asked the California Public Utilities Commission for money to cover a feasibility study. The utility did not return calls for comment on the project or the status on transmission line development [A06-08-011].

Raymond said the company would develop as much of the project as possible for BC Hydro, and would keep a close eye on several transmission projects that could link British Columbia with the U.S.

Specifically, Katabatic is pulling for PG&E to build its proposed transmission line from British Columbia to Northern California. "I think it's inevitable that PG&E will build some large-scale transmission project to bring in renewables from outside of California," Raymond said.

Part of the first phase of construction of the Banks Island project will be an 80-mile transmission line linking the project to the Canadian mainland and BC Hydro's transmission system.

Katabatic is developing one of the three wind farms selected in BC Hydro's 2006 call for tenders. The company's 25 MW Mount Hays wind farm is expected to be operational in 2008.

Winds at the Banks Island site peak in the winter, Raymond said. "They are pretty consistent throughout the year, but are strongest from October to April," he said.

The company will focus on project design and permitting, acquiring turbines and inking a power-purchase deal over the next two years, Raymond said. He declined to say when the company would ask the provincial government to begin its environmental review of the project.

"We have a world-class wind resource that's typically only found offshore, but here we get to work onshore, with good topography and straightforward logistics for construction and turbine delivery-it's a wonderful opportunity," said Anthony Duggleby, chief executive officer of Katabatic, in a prepared statement [Steve Ernst].