What a difference three years can make. In 2010, First Wind tried to do an initial public offering, but never made it out of the gate. Last Friday, in a sign of wind power’s now-entrenched place on the U.S. energy landscape, Pattern Energy Group had a successful IPO, raising $352 million.

Of course, there was more that was different about this IPO than the date it took place; as Reuters pointed out, “Pattern has solid cash flow and has been largely profitable, factors that may have helped the company get a better pricing and drive the stock up on debut.”

Still, the success of the Pattern IPO does say something about the state of the larger industry.

Utilities like wind because it’s a reliable way to meet renewable portfolio standards, and it is becoming more and more economically attractive, with the levelized cost of energy falling by half in the past four years. That led the financial firm Lazard to write recently that “while many had anticipated significant declines in the cost of utility-scale solar PV, few anticipated these sorts of cost declines for wind technology.”

To be sure, federal support has been very helpful in keeping the price of wind within shouting distance of very cheap natural gas. Yet earlier this year, the Berkeley Lab reported that “even within today’s low gas price environment … wind power can still provide a cost-effective long-term hedge against many of the higher-priced future natural gas scenarios being contemplated.”

Pattern isn’t just dependent on the U.S. market – it owns interests in four wind farms in the United States and one in Canada, has a partial interest in another in the U.S., and has two under construction – in Ontario and Chile. Those wind farms add up to 1,041 megawatts of rated capacity. The projects generally have long-term power purchase agreements, giving Pattern a very good expectation of continued, predictable cash flow.

The company (PEGI) priced its offering at $22 and closed its first day of trading Friday at $23.27, up about 6 percent. Shares Monday closed at $23.40.

—Pete Danko

This post originally appeared at EarthTechling and was republished with permission.

Comments

  1. Noneof yourbusiness
    Where I'm standing
    October 4, 2013, 2:22 pm

    Go ahead…invest in wind power…you will eventually lose your shirts. This “fad” will end within 10 years after it’s proven to be not practical on a national scale. I only hope they will have enough money left to dismantle these monuments to mankind’s folly.

  2. New Yorker
    New York, USA
    October 1, 2013, 3:36 pm

    Is wind power as environmentally-friendly and productive as it could be? Tall buildings near each other can cause a wind increase in wind speed (some scientists say as much as 30%) during a hurricane. So would not wind power utilize tall pylons to be more efficient–many wind/physicists scientists could easily figure this out on a computer? Does wind power have harmful EMG’s due to no casing–birds and other wildlife get EMG zapped each time they fly near the wind power? Further, wind power could utilize tiny mesh to help keep wildlife out–not directly around the wind power but at a set parameter (many meters around) as to not affect wind? How okay is the green technology? Is most green technology another cheap gimmick that also causes environmental damage–IPOs or not…