HONOLULU, HI--(Marketwire - December 29, 2008) - Hoku Solar, Inc., a wholly owned subsidiary of Hoku Scientific, Inc. (
Hoku had previously announced its selection by the Hawaii Department of Transportation (DOT) to design, engineer and install PV power systems at airports across the state. Under the terms of its agreement with UFA, Hoku will assign its power purchase agreements to the special purpose entity, Hoku Solar Power I, LLC, that has been created to own and operate each system, and that will sell the electricity generated by the PV power systems to DOT at a predetermined rate over a contract period of 20 years.
Hoku and UFA confirmed that the financing is expected to be sufficient for Hoku to complete all seven planned PV installations at DOT facilities on Kauai, Maui and Hawaii Island, a total of nearly 1 megawatt of clean solar power. These projects are the first major PV installations on Hawaii government-owned facilities, and among the largest third-party financed PV projects in the state.
UFA reported that it planned to invest in Hoku Solar Power I, LLC through its renewable energy fund, UFA Renewable Energy Fund which is being financed by U.S. Bancorp Community Development Corporation. Sennet Capital, a Hawaii-based merchant bank, arranged the financing and played a key role in structuring the deal.
"Hoku is pleased to have established this partnership with UFA," said Dustin Shindo, chairman and chief executive officer of Hoku Scientific. "Power purchase agreements offer a way to bring the benefits of clean solar energy to governments, municipalities and businesses with no upfront cost, while allowing investors to take full advantage of the associated investment tax credits. It really is a win-win for all involved. We are pleased that a Hawai'i-based firm like Sennet Capital was able to use the expertise and relationships it has created in financing solar PV transactions to help bring this relationship into existence, and look forward to working with them on other projects in the future."
"This is an excellent example of the widespread available benefits of deploying clean technology to public users through a private partnership," said Chris Hasle, Senior Vice President of UFA. "These types of PPA deals are increasingly common on the mainland U.S., and we believe that these projects could serve as an excellent model for many similar clean energy opportunities in Hawaii. Hoku is an important new partner for UFA and U.S. Bank and we hope this will be the first of many PPA projects we finance with them going forward."
Hoku Solar reported it had completed the engineering, design and procurement phases for the projects, and that it commenced system installation earlier this month at two DOT project sites on the island of Kauai. Hoku expects to complete the installation of all seven systems by the end of the first calendar quarter of 2009.
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