The agreement will remain in force for 20 years and guarantees the long-term profitability of the 99MW wind farm, which is currently under construction. It is expected that Star Point, the construction of which has already generated close to 150 jobs to date, will start operating commercially towards the end of 2010.

Iberdola Renovables, through its subsidiary Iberdrola Renewables, has invested $1 billion in Sherman County alone, where it already has 600MW of installed power.

This type of contracts, entitled Power Purchase Agreements (PPAs), ensure the company long-term returns from its US-based energy installations. Although they may extend solely to the purchase of energy, these agreements can also include Renewable Energy Certificates (RECs), which can be traded in certain US States.

The company said that through this agreement, Modesto Irrigation District will witness a 12% to 16% surge in its production from renewable energy sources, having set itself a target of 20% for 2017.