TORONTO, ONTARIO--(Marketwired - March 13, 2015) - Capstone Infrastructure Corporation (TSX:CSE)(TSX:CSE.DB.A)(TSX:CSE.PR.A)(TSX:CPW.DB) announced today that the Ontario Superior Court of Justice has determined that the Ontario Electricity Financial Corporation (OEFC) has not properly calculated the price paid for electricity produced under its power purchase agreements (PPAs) with Capstone and a number of other power producers in Ontario. In a decision dated March 12, 2015, the Court ruled that the methodology that the OEFC used from January 1, 2011 onward to calculate payments under Capstone's PPAs, and those of other producers, did not comply with the terms of those PPAs. The decision further requires the OEFC to revert to its pre-2011 methodology for calculating payments and to pay producers the difference between the payments calculated by the OEFC since 2011 and the amount of the payments they would have received using the pre-2011 methodology, plus interest and costs.
The OEFC has until April 13, 2015 to appeal this decision. If the decision is not appealed, or if it is upheld following any appeal, Capstone estimates that this will result in a receipt of approximately $25 million representing retroactive adjustments for revenue claimed from the OEFC. It is also expected that the future price paid for electricity at Capstone's Wawatay and Dryden hydro facilities will be calculated in accordance with the original pre-2011 methodology in their respective PPAs.
About Capstone Infrastructure Corporation
Capstone's mission is to provide investors with an attractive total return from responsibly managed long-term investments in core infrastructure in Canada and internationally. The company's strategy is to develop, acquire and manage a portfolio of high quality utilities, power and transportation businesses, and public-private partnerships that operate in a regulated or contractually-defined environment and generate stable cash flow. Capstone currently has investments in utilities businesses in Europe and owns, operates and develops thermal and renewable power generation facilities in Canada with a total installed capacity of net 461 megawatts. Please visit www.capstoneinfrastructure.com for more information.
Notice to Readers
Certain information presented in this news release contains "forward-looking information" within the meaning of Canadian securities legislation (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this news release. Forward-looking statements are provided for the purpose of presenting information about Capstone's management's current expectations relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements use forward-looking words, such as "anticipate", "continue", "could", "expect", "may", "will", "estimate", "plan", "believe" or other similar words, and include, among other things, statements concerning the amount of the one-time gain that Capstone will realize if the decision of the Ontario Superior Court of Justice is not appealed or is upheld following any appeal and the future prices that will be paid for electricity at the Wawatay and Dryden hydro facilities . These statements are subject to known and unknown risks and uncertainties that may cause actual results or events to differ materially from those expressed or implied by such statements and, accordingly, should not be read as guarantees of future performance or results. The forward-looking statements within this document are based on information currently available and what Capstone currently believe are reasonable assumptions.
Although Capstone believes that it has a reasonable basis for the expectations reflected in these forward-looking statements, actual results may differ from those suggested by the forward-looking statements for various reasons, including if the decision of the Ontario Superior Court of Justice is successfully appealed by the OEFC.
The assumptions, risks and uncertainties described above are not exhaustive and other events and risk factors could cause actual results to differ materially from the results and events discussed in the forward-looking statements. The forward-looking statements within this news release reflect current expectations of Capstone as at the date of this document and speak only as at the date of this document. Except as may be required by applicable law, Capstone does not undertake any obligation to publicly update or revise any forward-looking statements.