Sian Crampsie
Engie has signed definitive agreements to sell its interests in 10 GW of power generating capacity in the US market.
The energy firm, formerly known as GDF Suez, says that the sales are a key part of its efforts to transform its business by reducing its exposure of commodity prices and lowering its carbon footprint.
It has also announced the acquisition of OpTerra, a California-based energy services firm.
Engie says it has sold 8.7 GW of merchant thermal power generating capacity to a joint venture formed by Dynegy and ECP, and 1.4 GW of hydropower capacity to Public Sector Pension Investment Board (PSP Investments), one of Canada's largest pension investment funds.
The two deals combined are valued at €4.5 billion and will result in a reduction of €4.1 billion in Engie's net debt.
Engie has also announced the sale of its interests in Paiton and Meenakshi, two coal-fired power plants in Indonesia and India, respectively, representing 3 GW of generating capacity.
The sale of these two power plants will reduce Engie's net debt by €1.4 billion. The firm's 40.5 per cent stake in the 2 GW Paiton power plant will be sold to Nebras Power and a combination of some of the existing Paiton shareholders. Its shareholding in Meenakshi will be sold to India Power Corporation.
Overall, the asset sales will cut Engie's coal-fired capacity by 20 per cent and realise over one-third of the company's three-year, €15 billion portfolio rotation programme, CEO Gerard Mestrallet said.
Engie said in a statement that the acquisition of OpTerra would strengthen's Engie's role in the energy services market.
OpTerra offers a range of energy and sustainability management services to thousands of customers across the USA, including schools, universities, and commercial and industrial firms.
"These transactions perfectly illustrate the implementation of our transformation plan, to reduce Engie's carbon footprint and its exposure to commodity prices and to focus on two of our priorities: developing a low CO2 energy mix and innovative and integrated solutions for our clients," said Mestrallet. "Through the acquisition of OpTerra, Engie thus becomes the third US leader in energy services."
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