MDU Resources Announces Plans to Invest in Badger Wind Farm
MDU Resources Group (NYSE: MDU) has announced that its subsidiary, Montana-Dakota Utilities Co., will acquire a 49% ownership stake in the Badger Wind Farm, representing 122.5 MW of the project's total 250 MW generation capacity. The investment, valued at $294 million, is subject to regulatory approval from the North Dakota Public Service Commission.
The company previously secured a Power Purchase Agreement for 150 MW, which will be reduced to 27.5 MW upon closing of this ownership purchase. This strategic investment aligns with MDU's 2024 Integrated Resource Plan and was selected as the least-cost option for customers. The acquisition will significantly alter MDU's generation mix, increasing renewables from 29% to 39%, while reducing coal from 31% to 26% and gas from 40% to 35%.
MDU Resources Group (NYSE: MDU) ha annunciato che la sua sussidiaria, Montana-Dakota Utilities Co., acquisirà una partecipazione del 49% nel Badger Wind Farm, che rappresenta 122,5 MW della capacità totale di generazione del progetto di 250 MW. L'investimento, del valore di 294 milioni di dollari, è soggetto all'approvazione normativa della North Dakota Public Service Commission.
In precedenza, l'azienda aveva ottenuto un Accordo di Acquisto di Energia per 150 MW, che sarà ridotto a 27,5 MW al termine di questo acquisto di proprietà. Questo investimento strategico è in linea con il Piano Integrato delle Risorse 2024 di MDU ed è stato selezionato come l'opzione a costo più basso per i clienti. L'acquisizione cambierà significativamente il mix di generazione di MDU, aumentando le fonti rinnovabili dal 29% al 39%, mentre ridurrà il carbone dal 31% al 26% e il gas dal 40% al 35%.
MDU Resources Group (NYSE: MDU) ha anunciado que su subsidiaria, Montana-Dakota Utilities Co., adquirirá una participación del 49% en el Badger Wind Farm, que representa 122,5 MW de la capacidad total de generación del proyecto de 250 MW. La inversión, valorada en 294 millones de dólares, está sujeta a la aprobación regulatoria de la North Dakota Public Service Commission.
La compañía había asegurado previamente un Acuerdo de Compra de Energía por 150 MW, que se reducirá a 27,5 MW al cerrar esta compra de propiedad. Esta inversión estratégica está alineada con el Plan Integrado de Recursos 2024 de MDU y se seleccionó como la opción de menor costo para los clientes. La adquisición alterará significativamente la mezcla de generación de MDU, aumentando las energías renovables del 29% al 39%, mientras reduce el carbón del 31% al 26% y el gas del 40% al 35%.
MDU Resources Group (NYSE: MDU)는 자회사인 Montana-Dakota Utilities Co.가 Badger Wind Farm의 49% 지분을 인수할 것이라고 발표했습니다. 이는 프로젝트의 총 250 MW 발전 용량 중 122.5 MW에 해당합니다. 2억 9천4백만 달러로 평가된 이 투자는 노스다코타 공공 서비스 위원회의 규제 승인을 받아야 합니다.
회사는 이전에 150 MW의 전력 구매 계약을 확보했으며, 이 소유권 구매가 완료되면 27.5 MW로 축소될 것입니다. 이 전략적 투자는 MDU의 2024 통합 자원 계획과 일치하며 고객을 위한 최저 비용 옵션으로 선택되었습니다. 이 인수는 MDU의 발전 믹스를 크게 변화시켜 재생 가능 에너지를 29%에서 39%로 증가시키고 석탄을 31%에서 26%로, 가스를 40%에서 35%로 줄입니다.
MDU Resources Group (NYSE: MDU) a annoncé que sa filiale, Montana-Dakota Utilities Co., acquérera une participation de 49 % dans le Badger Wind Farm, représentant 122,5 MW de la capacité totale de génération du projet de 250 MW. L'investissement, d'une valeur de 294 millions de dollars, est soumis à l'approbation réglementaire de la North Dakota Public Service Commission.
L'entreprise avait précédemment obtenu un contrat d'achat d'électricité pour 150 MW, qui sera réduit à 27,5 MW lors de la clôture de cet achat de propriété. Cet investissement stratégique s'aligne sur le Plan Intégré des Ressources 2024 de MDU et a été sélectionné comme l'option à moindre coût pour les clients. L'acquisition modifiera considérablement le mélange de production d'énergie de MDU, augmentant la part des énergies renouvelables de 29 % à 39 %, tout en réduisant la part du charbon de 31 % à 26 % et du gaz de 40 % à 35 %.
MDU Resources Group (NYSE: MDU) hat bekannt gegeben, dass ihre Tochtergesellschaft, Montana-Dakota Utilities Co., eine 49%ige Beteiligung am Badger Wind Farm erwerben wird, die 122,5 MW der gesamten Projektleistung von 250 MW repräsentiert. Die Investition, die mit 294 Millionen Dollar bewertet wird, unterliegt der Genehmigung durch die North Dakota Public Service Commission.
Das Unternehmen hatte zuvor einen Stromabnahmevertrag über 150 MW gesichert, der beim Abschluss dieses Eigentumserwerbs auf 27,5 MW reduziert wird. Diese strategische Investition steht im Einklang mit MDUs integriertem Ressourcenplan 2024 und wurde als die kostengünstigste Option für die Kunden ausgewählt. Der Erwerb wird die Erzeugungsmischung von MDU erheblich verändern, indem der Anteil erneuerbarer Energien von 29% auf 39% erhöht wird, während der Anteil Kohle von 31% auf 26% und Gas von 40% auf 35% gesenkt wird.
- Strategic acquisition of 122.5 MW wind generation capacity for $294 million
- Increases renewable energy portfolio from 29% to 39%
- Selected as least-cost option for customers
- Aligns with company's Integrated Resource Plan for future energy demands
- Large capital expenditure of $294 million requiring regulatory approval
- Reduction in more reliable baseload generation sources (coal and gas)
Insights
The $294 million investment in Badger Wind Farm represents a strategic pivot in MDU Resources' generation portfolio, with several key implications for investors:
The transaction structure demonstrates sophisticated financial engineering by converting a portion of an existing PPA into ownership, effectively reducing future contracted obligations while securing long-term generation assets. This approach typically provides better long-term economics compared to pure PPA arrangements, particularly when considering available tax incentives for renewable energy investments.
The portfolio rebalancing - increasing renewables to
The regulatory strategy is particularly noteworthy. By filing an Advance Determination of Prudence with the NDPSC, MDU is proactively seeking regulatory support, which could streamline future rate case proceedings and reduce regulatory lag in cost recovery. This approach typically results in more predictable returns for regulated utilities.
The investment aligns with MDU's five-year capital expenditure plan, suggesting careful integration into their broader financial strategy. For a company with a
The timing of this investment, coinciding with MDU's centennial year, reflects a forward-looking approach to utility operations, transitioning from traditional generation sources to a more sustainable mix while maintaining reliability through natural gas peaking capacity. This balanced strategy should resonate well with both regulators and investors focused on ESG metrics while ensuring operational stability.
MDU's 2024 Integrated Resource Plan (IRP) identified the need for additional generation capacity to meet future energy demands. The investment in the Badger Wind Farm was selected as the least-cost option for MDU's customers, aligning with the company's commitment to providing reliable and affordable energy. Construction is currently underway near
This strategic investment is part of MDU Resources' five-year capital expenditure plan. The estimated cost for MDU to purchase this stake is
MDU previously executed a Power Purchase Agreement (PPA) for 150 MW of the Badger Wind Farm's output last November, which included the
"This investment enhances our diversified portfolio of assets, allowing MDU to meet customer demand with a mix of generation assets that includes coal as well as wind backed by natural gas peakers to effectively serve our customers' needs," said Nicole Kivisto, president and CEO of MDU Resources.
The addition of the Badger Wind Farm is estimated to have the following impact to MDU's nameplate generation mix:
Current | With Badger Wind | |
Renewables | 29 % | 39 % |
Coal | 31 % | 26 % |
Gas | 40 % | 35 % |
To ensure the prudence of this investment, MDU has filed an Advance Determination of Prudence (ADP) with the NDPSC. An ADP request asks the NDPSC to determine whether a generation project is reasonable and prudent for providing electric service to the public.
About MDU Resources Group, Inc.
MDU Resources Group, Inc., a member of the S&P SmallCap 600 index, provides essential products and services through its regulated electric and natural gas distribution and pipeline segments. Founded in 1924 as a small electric utility, MDU Resources has grown to serve more than 1.2 million customers across eight states and is celebrating its 100th anniversary. Learn more at www.mdu.com/100th-anniversary. The Company operates in the Pacific Northwest and Midwest, constructing and operating infrastructure that delivers natural gas and electricity that energizes homes and businesses. For more information about MDU Resources, visit www.mdu.com or contact the Investor Relations Department at investor@mduresources.com.
Investor Contact: Brent Miller, treasurer, 701-530-1730
Media Contact: Byron Pfordte, director of integrated communications, 208-377-6050
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SOURCE MDU Resources Group, Inc.
FAQ
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What regulatory approvals does MDU need for the Badger Wind Farm purchase?
How will MDU's Power Purchase Agreement change after the Badger Wind Farm acquisition?
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