Sempra Infrastructure Launches Cimarron Wind Project

Rhea-AI Summary

Sempra Infrastructure, a subsidiary of Sempra (NYSE: SRE), has made a positive final investment decision for the Cimarron wind project, part of the Energía Sierra Juarez wind complex. The project will have 320 MW of wind capacity and is fully contracted under a 20-year agreement with Silicon Valley Power. With an estimated cost of $550 million, the project is set to start generating energy in late 2025, aiming to support clean renewable energy needs. The project is expected to create over 2,000 jobs and reduce greenhouse gas emissions by 210,000 metric tons annually.

Positive

• Positive final investment decision for the Cimarron wind project by Sempra Infrastructure.
• Fully contracted under a 20-year power purchase agreement with Silicon Valley Power.
• Estimated 320 MW of wind capacity with a fixed-price turbine supply agreement with Vestas.
• Total capital expenditures for the project estimated at $550 million.
• Expected to commence generating energy in late 2025, supporting clean renewable energy needs.
• Expected to create over 2,000 direct and indirect jobs and reduce greenhouse gas emissions by 210,000 metric tons annually.

Negative

• None.

HOUSTON, March 14, 2024 /PRNewswire/ -- Sempra Infrastructure, a subsidiary of Sempra (NYSE: SRE) (BMV: SRE), announced today that it reached a positive final investment decision for the development, construction and operation of the Cimarron wind project, the third phase of the Energía Sierra Juarez (ESJ) wind complex.

The Cimarron wind project will total approximately 320 megawatts (MW) of wind capacity, and the project is fully contracted under a 20-year power purchase agreement to Silicon Valley Power for the long-term supply of renewable energy to the City of Santa Clara, California.  The project has a fixed-price turbine supply agreement with Vestas for the supply and installation of 64 wind turbines and a similar fixed-price agreement with Elecnor for the construction of the balance of plant.  The Cimarron project will utilize Sempra Infrastructure's existing cross-border, high-voltage transmission line interconnecting the ESJ wind complex directly into the California Independent System Operator system.

Total capital expenditures for the project are estimated at $550 million, and the project is expected to commence generating energy in late 2025.

"We are excited to cost-effectively expand the ESJ wind complex to support Silicon Valley Power's needs for clean renewable energy," said Justin Bird, CEO of Sempra Infrastructure. "Cimarron wind is expected to provide strong financial returns and represents another important step toward our mission of becoming North America's leading energy infrastructure company."

Cimarron will produce energy equivalent to the annual energy consumption of more than 84,000 homes and is expected to reduce greenhouse gas emissions by around 210,000 metric tons of carbon dioxide equivalent (CO2e) per year.¹ The construction of the new facility is expected to create more than 2,000 direct and indirect jobs with additional local community investment under Sempra Infrastructure's framework for corporate giving as part of the company's commitment to the communities where it operates.

The first two phases of the ESJ wind complex, totaling 263 MW, are under long-term power purchase agreements with San Diego Gas & Electric. Once the Cimarron project is in operation, the ESJ wind complex will have total installed capacity of more than 580 MW and will represent one of the largest commercial wind projects in all of Mexico.

Sempra Infrastructure has submitted an interconnection request for an additional 300 MW of capacity at the site, which has a potential expansion opportunity of more than 650 MW, which if developed could result in Sempra Infrastructure owning over 1,200 MW of installed wind capacity in the Baja California region.

The Cimarron wind project is being developed by Sempra Infrastructure's low carbon solutions business line which is focused on commercializing and deploying low carbon solutions in order to meet the growing demand for cleaner energy in the form of electrons and molecules. Sempra Infrastructure's existing portfolio of renewable resources includes more than 1,000 MW of clean energy infrastructure, as well as hydrogen fuel production and advanced carbon capture, usage and storage technologies that are under development.

About Sempra Infrastructure
Sempra Infrastructure, headquartered in Houston, is focused on delivering energy for a better world by developing, building and operating low carbon solutions, energy networks, and LNG infrastructure that are expected to play a crucial role in the energy systems of the future. Through the combined strength of its assets in North America, Sempra Infrastructure is connecting customers across the globe to modern energy infrastructure to source and transport renewables and natural gas, while advancing carbon sequestration and clean hydrogen. For more information about Sempra Infrastructure, please visit www.SempraInfrastructure.com and social media.

¹ Based upon "Emission Factors for Greenhouse Gas Inventories" calculation methodology from the EPA Center for Corporate Climate Leadership.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions about the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed or implied in any forward-looking statement. These forward-looking statements represent our estimates and assumptions only as of the date of this press release. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise.

In this press release, forward-looking statements can be identified by words such as "believe," "expect," "intend," "anticipate," "contemplate," "plan," "estimate," "project," "forecast," "envision," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "construct," "develop," "opportunity," "preliminary," "initiative," "target," "outlook," "optimistic," "poised," "maintain," "continue," "progress," "advance," "goal," "aim," "commit," or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.

Factors, among others, that could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement include: decisions, investigations, inquiries, regulations, denials or revocations of permits, consents, approvals or other authorizations, and other actions, including the failure to honor contracts and commitments, by the (i) U.S. Department of Energy, Comisión Reguladora de Energía, U.S. Federal Energy Regulatory Commission, U.S. Internal Revenue Service and other regulatory bodies and (ii) U.S., Mexico and states, counties, cities and other jurisdictions therein and in other countries where we do business; the success of business development efforts, construction projects, acquisitions, divestitures and other significant transactions, including risks related to (i) being able to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) realizing anticipated benefits from any of these efforts if completed, (iv) obtaining third-party consents and approvals, and (v) third parties honoring their contracts and commitments; macroeconomic trends or other factors that could change our capital expenditure plans and their potential impact on growth; litigation, arbitrations, property disputes and other proceedings, and changes to laws and regulations, including those related to tax and trade policy and the energy industry in Mexico; cybersecurity threats, including by state and state-sponsored actors, of ransomware or other attacks on our systems or the systems of third parties with which we conduct business, including the energy grid or other energy infrastructure; the availability, uses, sufficiency, and cost of capital resources and our ability to borrow money or otherwise raise capital on favorable terms and meet our obligations, including due to (i) actions by credit rating agencies to downgrade our credit ratings or place those ratings on negative outlook, (ii) instability in the capital markets, or (iii) rising interest rates and inflation; the impact on our ability to pass through higher costs to customers due to volatility in inflation, interest and foreign currency exchange rates and commodity prices; the impact of climate and sustainability policies, laws, rules, regulations, disclosures and trends, including actions to reduce or eliminate reliance on natural gas, the risk of nonrecovery for stranded assets, and uncertainty related to relevant emerging and early-stage technologies; weather, natural disasters, pandemics, accidents, equipment failures, explosions, terrorism, information system outages or other events, such as work stoppages, that disrupt our operations, damage our facilities or systems, cause the release of harmful materials or fires or subject us to liability for damages, fines and penalties, some of which may not be recoverable through insurance or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of natural gas, including disruptions caused by failures in the pipeline system or limitations on the withdrawal of natural gas from storage facilities; and other uncertainties, some of which are difficult to predict and beyond our control.

These risks and uncertainties are further discussed in the reports that Sempra has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov, and on Sempra's website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.

Sempra Infrastructure and Sempra Infrastructure Partners are not the same company as San Diego Gas & Electric Company or Southern California Gas Company, and none of Sempra Infrastructure, Sempra Infrastructure Partners nor any of its subsidiaries is regulated by the California Public Utilities Commission.

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SOURCE Sempra Infrastructure

FAQ

What is the total wind capacity of the Cimarron wind project?

The Cimarron wind project will have approximately 320 megawatts (MW) of wind capacity.

What is the duration of the power purchase agreement for the project?

The project is fully contracted under a 20-year power purchase agreement with Silicon Valley Power.

What is the estimated total capital expenditures for the project?

Total capital expenditures for the project are estimated at $550 million.

When is the project expected to start generating energy?

The project is expected to commence generating energy in late 2025.

How many jobs are expected to be created by the project?

The construction of the new facility is expected to create more than 2,000 direct and indirect jobs.

What is the expected annual reduction in greenhouse gas emissions from the project?

The project is expected to reduce greenhouse gas emissions by around 210,000 metric tons of carbon dioxide equivalent (CO2e) per year.