In November 2012, SFS EF AM committed $10 million to the Borrower’s $25 million, senior, secured term loan (the “Term Loan”). The 17-year Term Loan will fully amortize by 2030 with a 3-year PPA tail. The SFS EF AM’s share of the Term Loan balance, at the end of February 2016, was about $9.02 million. SFS EF AM did not participate in the Operating Company’s senior secured operating company loan (the “OpCo Term Loan”). The Term Loan is subordinated to the OpCo Term Loan. The OpCo Term Loan is a 10-year $129.1 million institutional note. The operating performance, since the last rating review (completed on March 18, 2015), was adversely affected by the low wind speed. The actual wind speed factor in 2015 was lower than the wind speed noted in the last rating review as well as the forecasted wind speed in the SFS EF AM Base Case. The main reason for the decline in the wind speed was the “Wake Effect” – the construction of additional wind farms adjacent to the Project or in the Project’s wind path adversely affecting the wind velocity for the Project’s WTGs. The average wind speed of 5.52 m/s was recorded in 2015- a 15.5% decline from the SFS EF AM forecast (6.53 m/s) and about 9.7% lower than the 2014 (6.11 m/s) wind speed. This phenomenon has materially affected the Project’s energy production capability.
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The total energy output in 2015 was 292.5 GWhs, about 16.4% lower than the SFS EF AM Base Case forecast of 350 GWhs. The 2015 plant availability factor was strong, 98.2%. The SFS EF AM Base Case availability factor was 94.2%. Since the commercially operating date (“COD”), the project availability factor has been higher than the SFS EF AM Base Case forecast. Decline in the energy output lowered 2015 revenues by about 16% over the SFS EF AM Base Case. The 2015 maintenance expenses were slightly higher than the SFS EF AM forecast (~4.1%), due to the higher WTGs and the balance-of-plant maintenance related costs. The 2015 increase in the maintenance costs was offset by the lower insurance premiums, land lease costs, and the property taxes. The net change was about a 3% positive variance over the SFS EF AM Base Case operating costs. Total revenues for 2015 were about $20.1 million and the total O&M costs were $5.2 million. The 2015 net operating revenues were down by about 20% over the SFS EF AM Base Case forecast. At the end of 2015, the Project’s risk profile was raised to yellow by the SFS Portfolio Management due to the ongoing problem with the WTG foundations. At the end of 2013, the Borrower noticed cracks in the WTG foundations. The Borrower hired Aero Solutions, LLC (“AERO”) to undertake a supplementary root cause analysis (the “RCA”) after the initial RCA prepared by its contractor, Aubrey Silvey (the Contractor”), was rejected by the Borrower. Aero concluded that Collar Cracks, Grout Cracks and Slurry Cracks represent the risk of deterioration in the foundation due to the water ingress. In addition, the analysis further revealed that some WTG foundations had inadequate stiffness. The RCA was reviewed by the Independent Engineer (“the IE” or “Leidos”) and the IE noted potential risks to the Project during operations. The potential risks include, increased maintenance costs for
The total energy output in 2015 was 292.5 GWhs, about 16.4% lower than the SFS EF AM Base Case forecast of 350 GWhs. The 2015 plant availability factor was strong, 98.2%. The SFS EF AM Base Case availability factor was 94.2%. Since the commercially operating date (“COD”), the project availability factor has been higher than the SFS EF AM Base Case forecast. Decline in the energy output lowered 2015 revenues by about 16% over the SFS EF AM Base Case. The 2015 maintenance expenses were slightly higher than the SFS EF AM forecast (~4.1%), due to the higher WTGs and the balance-of-plant maintenance related costs. The 2015 increase in the maintenance costs was offset by the lower insurance premiums, land lease costs, and the property taxes. The net change was about a 3% positive variance over the SFS EF AM Base Case operating costs. Total revenues for 2015 were about $20.1 million and the total O&M costs were $5.2 million. The 2015 net operating revenues were down by about 20% over the SFS EF AM Base Case forecast. At the end of 2015, the Project’s risk profile was raised to yellow by the SFS Portfolio Management due to the ongoing problem with the WTG foundations. At the end of 2013, the Borrower noticed cracks in the WTG foundations. The Borrower hired Aero Solutions, LLC (“AERO”) to undertake a supplementary root cause analysis (the “RCA”) after the initial RCA prepared by its contractor, Aubrey Silvey (the Contractor”), was rejected by the Borrower. Aero concluded that Collar Cracks, Grout Cracks and Slurry Cracks represent the risk of deterioration in the foundation due to the water ingress. In addition, the analysis further revealed that some WTG foundations had inadequate stiffness. The RCA was reviewed by the Independent Engineer (“the IE” or “Leidos”) and the IE noted potential risks to the Project during operations. The potential risks include, increased maintenance costs for