Posted on 26 March 2010.
OTTAWA, March 25 (UPI) — Wind energy projects run by Wind Works Power Corp. received a boost with a $10 million credit facility that will go toward developing capacity in Canada, the United States and Europe.
Wind Works Power Corp. said it was pledged the line of credit after an investment agreement signed with Kodiak Capital Group LLC of New York. The agreement covers a
a $10 million equity line of credit that Wind Works will use to expand projects in its portfolio.
Wind energy received a major boost worldwide amid controversy over the impact of hydrocarbons use on climate change and also the volatile conditions in the crude oil market.
In the poorer countries hit by oil price spikes through 2009 renewable energy generation, including wind power, became an urgent priority. U.N. cash helped poorer countries start renewable energy projects in Africa and the Caribbean, though on a small scale compared to those countries’ energy needs.
However, the less-developed countries still lag behind industrial nations in optimum use of renewable energy because the technologies they apply in harnessing wind power and other renewable sources are often primitive. Lack of cash resources has come in the way of developing nations adopting renewable energies as efficiently as in the industrial world.
In North America and Europe, wind energy, wave energy and geothermal power have caught on with impressive results, attracting new investment.
Wind power development in North America received an unexpected setback as security authorities found that wind energy farms obstructed proper functioning of radar.
The most publicized obstacles to wind power expansion have been complaints over their visual impact and the potential for bird and bat deaths. Less known is the conflict with radar systems, highlighted by military authorities.
More than 9,000 megawatts worth of wind capacity, nearly as much as was installed in the United States in 2009, had to be canceled because of those security concerns.
Wind farms create “cones of silence,” making it difficult for primary radar systems to detect airplanes as they fly over them. Planes with transponders can communicate with air traffic control but many smaller planes don’t have transponders.
Analysts said the conflict over radar would need to be addressed for wind farms to thrive and attract more investment. The latest credit accord indicated that investment climate for wind farms could be improving.
Following the agreement signing, Wind Works filed a registration statement with the U.S. Securities and Exchange Commission to register 10 million shares of common stock. Wind Works will draw down on the credit facility, in amounts and timing at its sole discretion, and will issue common stock to Kodiak as the facility is utilized. The company won’t be able to draw down the equity line of credit with Kodiak until the registration statement is declared effective by the SEC.
Wind Works plans to use the funding from the equity line of credit to further develop its project portfolio. The company’s holding consists of equity interests in 23 wind energy projects in Canada, the United States and Europe for a total capacity of 367 megawatts.
Wind Works President and Chief Executive Officer Ingo Stuckmann said the credit facility facility “offers us access to the capital markets that we believe provides more flexibility, and ultimately less dilution, than traditional financing vehicles.”
The funds will enable the company to expand its operations and advance its project portfolio “to the point we can generate revenue in the near term, thereby adding value to the company and increasing shareholder value,” Stuckmann said.
Kodiak Capital Group, LLC, which was founded in 2009 and has headquarters in New York, assists growth companies in their long-term strategy by providing capital and business solutions.
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