Cielo Wind Power

Cielo Wind Power LP, an Austin-based wind energy company, along with the U.S. Renewable Energy Group, has forged a joint venture agreement with China’s Shenyang Power Group to build a 600-megawatt wind farm on about 36,000 acres in Texas. The project is estimated at $1.5 billion.

According to Cielo executives, the agreement is one of the first between Chinese and U.S. entities to jointly develop a utility-scale wind power project. The new wind farm is projected to produce enough electricity to power 180,000 homes, and to create hundreds of jobs in the U.S.

Cielo CEO Walt Hornaday said most of those jobs will likely be at the project site in West Texas. He said Cielo’s staff is well-equipped to handle the new work, although the company may add a few technical positions.

According the the joint venture agreement, commercial banks in China are expected to finance the $1.5 billion for the project through Shenyang Power Group. A-Power Energy Generation Systems Ltd. (Nasdaq: APWR), a shareholder of Shenyang Power Group in China, will supply 240 units of the 2.5-megawatt wind turbines manufactured at A-Power’s facilities in Shenyang, China. Subject to securing the financing, A-Power is expected to start shipping the wind turbines in March 2010 and delivery all units by March 2011.

“A $1.5 billion, 600-megawatt renewable energy project will be one of the largest undertakings of its kind anywhere in the world,” Cielo CEO Walt Hornaday said. “Cielo is excited to be part of this historic partnership that will not only generate clean, homegrown, renewable energy, but also create a robust economy with new jobs and revenue.”

Cielo will likely see some return on the investment it’s made in the joint venture, Hornaday said, although he declined to say how much the company had invested or what kind of financial gain it expects.

According to its Web site, Cielo Wind Power is among the largest privately held wind power project development companies in the Southwest. As of 2009, Cielo Wind Power has developed and installed 1 percent of the world’s wind-generated energy, and has developed 16 percent of all installed wind power capacity in Texas, according to the Web site.

“Without the American Recovery and Reinvestment Act of 2009, this joint venture with SPG would not be possible,” said Joe Stark, vice president of finance and business development with Cielo. “Thanks to the strong policy push and a recovering financing environment, wind projects in the U.S. are attracting developers and investors alike once again. … We are very encouraged by all the new opportunities in the wind power sector.”